Digital Gift Cards Rising in Popularity

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Digital Gift Cards Rising in Popularity


PORTLAND, Ore. -- The gift that keeps on giving is a gift card that consumers can purchase and redeem online, according to new research by InComm. Survey results show digital gift cards are rising in popularity, with 77 percent of surveyed consumers likely to purchase at least one this holiday season.

InComm, a provider of prepaid products, defines a digital gift card as a card that is emailed to the recipient.

Beyond the holiday season, 82 percent of respondents said they "strongly agree" or "agree" that they are likely to buy at least one gift card from an online website or mobile website/app in 2014, while approximately 75 percent agree that they are likely to buy at least one digital gift card.

Respondents provided these reasons for why they've purchased digital gift cards:

  • Instant delivery, 62 percent
  • Easier to send, 42 percent
  • Easier and quicker to purchase, 32 percent
  • "Cool gift" to give, 28 percent
  • Easier to redeem, 26 percent
  • Environmentally friendly, 21 percent
  • Harder to lose, 21 percent
  • Recipient prefers digital gift cards, 18 percent

Additionally, 70 percent of respondents strongly agree or agree that they are more interested in purchasing digital gift cards now than they were two or three years ago. There is also interest in going paperless. Forty-six percent said they are interested in storing digital gift cards on their phones, and 40 percent said they would prefer to have a digital gift card scanned from their phone rather than carry an email printout if they were to receive a digital gift card.

When purchasing gift cards from online websites or mobile websites/apps, 40 percent of respondents indicated that the decision to purchase a digital gift card vs. a physical gift card depends on for whom they're buying the card. An overwhelming majority, 87 percent, like to have the option to purchase either a physical or digital gift card.

As for where their money is spent, respondents said they prefer to purchase gift cards online from the following merchants:

  • Restaurants/casual dining, 54 percent
  • Department stores, 44 percent
  • Online-only retailers, 35 percent
  • Entertainment (music, movies), 32 percent
  • Electronics, 31 percent
  • Coffee shops, 30 percent
  • Fast food, 24 percent
  • Grocery, 21 percent
  • Home improvement, 18 percent

The InComm survey also found that 54 percent of respondents place $25 to $49 on a gift card purchased from an online website or mobile website/app, while 20 percent place $50 to $74. Eight-three percent said they purchase these gift cards for relatives, 50 percent purchase them for friends, 42 percent treat themselves and 15 percent purchase them for co-workers.