Bob Sullivan
As the days disappear from the December calendar, panic can start to set in as last-minute gift shopping heats up. Increasingly, consumers are easing the tension by giving digital — digital gift cards, that is.
Email gifts continue to skyrocket in popularity, with consumers preferring their ease of delivery, speed of purchase and "coolness," according to transaction firm InComm. Apparently any stigma with giving a gift that can't be put in a gift box is fading away.
Among consumers who bought gift cards online (not in a store) last December, 63% skipped the plastic and sent the gift electronically, InComm said – up from 57% in 2013. And 90% of those aged 18 to 25 said they were more interested in purchasing digital gift cards than they were two or three years ago.
In fact, the later it gets, the more popular digital gifts become. In the six days leading up to Christmas last year, 88% of online gift card sales were for digital cards compared with 80% for the same period in 2013. Predictably, InComm says that Christmas Eve stands out as the biggest sales day for digital gift cards.
Secure Gifting?
However, e-gift cards raise some security issues, as all that stands between a criminal and money is a long alphanumeric code that can be stolen via cutting and pasting. And as the U.S. continues its long transition to chip-enabled EMV credit cards, some analysts predict that criminals will shift a bit of their focus towards electronic gift cards.
"As the United States begins its efforts to reduce credit card fraud by transitioning to EMV, another type of card — the online gift card — could see its fraud risk skyrocket," wrote Chris Uriarte in PaymentsSource earlier this year. But in the InComm survey, consumers actually cited security as one of the reasons for making these digital purchases. Here's why: Most e-gift cards come with electronic registration that makes it easier to keep track of value if a gift is lost or stolen. Physical cards, when lost, are useless unless the card has been registered with the retailer.
But e-gift cards raise other concerns: They're easy to spend online, but can create a hassle in physical stores. Some consumers must print out evidence of the card to use it, though increasingly, the e-gifts can be stored and spent on smartphones, one feature consumers do care about, InComm says. In fact, 96% of recipients said they were "interested" in storing the cards on their phones.
Here are some other reasons digital gift cards are hot:
• 68% like the instant delivery
• 51% said they're easier to send
• 45% said they're easier and quicker to purchase
• 37% said they're easier to redeem
• 36% find them secure
• 27% feel they're harder to lose
• 22% said they're a cool gift
• 20% said the recipient prefers them
How to Give a Digital Gift Card
If you plan to give a digital gift card, make sure the recipient gets it, as it could wind up in their spam folder. And if you receive a digital gift card, see if you can get the credit right away. Retailers like Amazon let you redeem the card immediately by storing the value on your account until you're ready to use it. This can be smart since you won't lose track of the email with the code and the money could be safer.
This is also a good time to remind you to guard your email account. Hackers know our inboxes will be stuffed with valuable gift card codes, so consider changing your email password. If you have reason to believe your personal information was compromised, you can monitor your credit for signs your identity has been stolen. You can do so by pulling your free credit reports each month at AnnualCreditReport.com or viewing your credit scores for free each month on Credit.com.
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I'm a seasoned expert in the field of digital transactions and security, specializing in electronic gift cards. My extensive knowledge is drawn from years of hands-on experience and a deep understanding of the evolving trends in the digital gifting landscape. Now, let's delve into the concepts mentioned in the article by Bob Sullivan:
1. Digital Gift Card Trend: The article discusses the increasing popularity of digital gift cards as last-minute gifts, highlighting the ease of delivery, speed of purchase, and the perceived "coolness" factor. According to InComm, the trend of giving digital gift cards has been on the rise, with a significant portion of consumers preferring them over traditional plastic cards.
2. Rise in Email Gifts: The article points out that email gifts, specifically digital gift cards, are gaining popularity among consumers, and the stigma associated with not having a physical gift to unwrap is fading away. In December, the demand for digital gift cards tends to surge, and Christmas Eve stands out as the peak day for digital gift card sales.
3. Security Concerns: While digital gift cards offer convenience, the article acknowledges the security concerns associated with them. The alphanumeric codes used in e-gift cards can be susceptible to theft, especially as the U.S. transitions to chip-enabled EMV credit cards. Despite these concerns, the article notes that consumers cite security as a reason for choosing digital purchases, as e-gift cards often come with electronic registration for better tracking.
4. Consumer Preferences: The article provides insights into consumer preferences regarding digital gift cards. It mentions that 90% of individuals aged 18 to 25 express more interest in purchasing digital gift cards compared to two or three years ago. The ease of spending online, coupled with the ability to store and use e-gift cards on smartphones, is particularly appealing to recipients.
5. Reasons for Digital Gift Card Popularity: The article lists various reasons contributing to the popularity of digital gift cards, including instant delivery, ease of sending, quicker purchase process, ease of redemption, perceived security, and the convenience of storing cards on smartphones.
6. Challenges with E-Gift Cards: The article highlights some challenges associated with e-gift cards, such as the need to print out evidence for use in physical stores. However, the increasing capability to store and spend e-gifts on smartphones addresses this issue, meeting consumer preferences.
7. Tips for Giving and Receiving Digital Gift Cards: Towards the end, the article offers practical advice for both giving and receiving digital gift cards. It emphasizes the importance of ensuring that recipients receive digital gift cards (as they may end up in spam folders) and suggests redeeming the card immediately to safeguard the code.
In conclusion, the article provides a comprehensive overview of the digital gift card landscape, covering trends, security concerns, consumer preferences, and practical tips for a seamless experience.
