InComm Research Proves Digital Gift Cards Rising in Popularity for this Holiday Season and Beyond

PORTLAND, Ore., Dec. 4, 2013 /PRNewswire/ -- InComm, a leading prepaid product and transaction services company, today released research highlighting consumer shopping trends for purchasing digital and physical gift cards from websites and mobile devices. Of the consumers surveyed, 67% have previously bought a gift card from an online website or mobile website/app, while 33% have not. Respondents answered questions about their purchasing habits and their intentions for purchasing gift cards from websites and mobile devices – as well as digital cards specifically – this holiday season and beyond. Highlights include:

• 88% agree they're likely to purchase at least one gift card from an online website or mobile website/app this holiday season, with 77% likely to purchase at least one digital gift card 
• Of those who intend to purchase gift cards from online websites or mobile websites/apps this holiday season, 20% plan to purchase more than 5 gift cards
• 40% prefer to have a digital gift card scanned from their phone rather than carry an email printout
• Nearly 70% strongly agree that they are more interested in purchasing digital gift cards now than they were two to three years ago
• Nearly 20% of those who have purchased gift cards from online websites or mobile websites/apps purchase 5-7 cards annually

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"We believe it's important for retailers and brands to augment their in-store gift card selection by enabling consumers to easily purchase both physical and digital gift cards from their desktops and mobile devices," said Mike Fletcher, SVP Sales & Marketing, Digital Solutions, InComm. "Brands can dramatically improve sales throughout the year – especially at the holidays – by opening up gift card sales through all channels. This research shows that consumers want more options for buying and sending gift cards, giving retailers even more reason to expand their offering and ensure an optimal shopping experience for the gift giver and receiver."

Purchasing Physical vs. Digital Gift Cards

Of those who have bought a gift card from an online website or a mobile website/app, 36% have purchased a physical gift card, while 33% have purchased a digital gift card and 31% have purchased both. A digital gift card was defined as a card that is emailed to the recipient, and a physical gift card defined as a traditional gift card that is shipped to the recipient. When asked how many gift cards they purchase from online websites or mobile websites/apps annually, respondents answered:

• 29% purchase 1
• 36% purchase 2-4
• 19% purchase 5-7
• 9% purchase 8-10
• 8% purchase more than 10

When deciding whether to purchase a digital gift card or a physical gift card, nearly 40% state that it depends on who they're buying the card for. In fact, 87% prefer to have the option to purchase either a physical gift card or a digital gift card when purchasing gift cards from online websites or mobile websites/apps.

2013 Holiday Intentions

Eighty-eight percent of respondents strongly agree or agree that they're likely to purchase at least one gift card from an online website or mobile website/app this holiday season, while 77% strongly agree or agree that they are likely to purchase at least one digital gift card. 

Participants were asked how many gift cards they intend to purchase from online websites or mobile websites/apps this holiday season:

• 9% are likely to buy 1    
• 48% are likely to buy 2-3                             
• 23% are likely to buy 4-5
• 21% are likely to buy more than 5                           

2014: Digital and Mobile are on the Rise

Beyond the holidays, 82% of respondents 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 about 75% agree that they are likely to buy at least one digital gift card.

Nearly 70% strongly agree or agree that they are more interested in purchasing digital gift cards now than they were two to three years ago. Also, 46% are interested in storing digital gift cards on their phones, and 40% 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.

Respondents answered the reasons that they have purchased digital gift cards:

• 62% said instant delivery            
• 42% said easier to send               
• 32% said easier and quicker for me to purchase
• 28% said are a cool gift to give  
• 26% said easier to redeem                         
• 21% said environmentally friendly                         
• 21% said harder to lose
• 18% said the recipient prefers digital gift cards

Gift Card Shopping Behavior

Respondents were asked when they purchase gift cards from online websites or mobile websites/apps, which types of merchants do they purchase from/for: 

• 54% answered restaurants/casual dining
• 44% answered department stores
• 35% answered online-only retailers
• 32% answered entertainment (music, movies)
• 31% answered electronics
• 30% answered coffee shops
• 24% answered fast food
• 21% answered grocery
• 18% answered home improvement

Also, 54% of respondents place between $25-49 on a gift card that they purchase from an online website or mobile website/app, while 20% place between $50-74. Further, when asked who they purchase the gift cards for that they buy from online websites or mobile websites/apps, 83% said relatives, 50% said friends, 42% said themselves and 15% said co-workers.

Respondents stated which features/capabilities are important to the purchasing experience when buying gift cards from online websites or mobile websites/apps:

• 69% said security                            
• 40% said the ability to personalize the message                              
• 40% said a variety of designs to choose from (birthday, holiday, etc.)                   
• 57% said a variety of denominations available 

All respondents were surveyed online in November 2013.

About InComm
InComm is a leading provider of cutting-edge prepaid products, services and transaction technologies to retailers, brands and consumers. InComm supports more than 400,000 points of distribution and helps retailers build prepaid card destinations, connects brands with new markets and gives consumers a simple, secure shopping experience. InComm stays ahead of emerging trends by analyzing market needs and leveraging its global, innovative commerce platform, go-to-market expertise and extensive partner relationships. With 123 global patents, InComm is headquartered in Atlanta and has offices in North and South America, Europe and the Asia-Pacific region. For more information, visit www.incomm.com or follow us on Twitter at www.twitter.com/incomm.

SOURCE InComm