As with the rest of our society, gift giving has moved online. Over the past few years, it has become possible to deliver, and even redeem, gift cards via e-mail and mobile devices. Until recently, however, this gift card channel was slow to take off though there are signs that 2011 may be the year when virtual and mobile cards see wide adoption.
In a press release, Transaction Wireless, an e-gift card provider, reported that some of its merchants saw virtual and mobile card sales for Valentine’s Day increase three to five times what they were before. While this is characteristic of a new market, it also points to the variety of options that consumers have when they choose to buy a gift card online.
Gift givers can express themselves by customizing mobile gift cards with personal messages, video and pictures and can time the arrival of the card for just the right moment. The cards are safely stored on the mobile device, helping to ensure gifts will be used rather than lost or forgotten. Gift cards can be redeemed online or in retail outlets.
TW’s digital gifting platform enables the simple, safe purchase of gift cards directly from any mobile or digital device and it also allows social gifting on retailers’ Facebook Pages, creating a viral effect that gift cards were lacking until now.
Transaction Wireless counts Applebee’s, American Eagle Outfitters, AMC Theaters, Blockbuster, and SpaFinder among its clients.
Of course, Transaction Wireless is not alone in this space. Other virtual card providers include Giftango (which works with J.C. Penney & Co., Fandango, and Cabela’s), Dimpledough (which works with First Data and Moneris) and Cash Star (which works with Home Depot, Best Buy, and Starbucks).
Mercator plans to track the growth of this delivery channel and include questions about it in future surveys. Electronic prepaid cards will lead the way in a variety of new technologies, including group gifting social media applications and mobile spending. We expect this market to begin to grow very quickly, and 2011 may be the year that it begins to take off.
