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Conversion Optimization

eCommerce Gift Card Marketing: 8 Creative Ways to Drive Max ROI

Want to increase lifetime value and customer retention using gift card marketing? Here are 8 proven strategies you might want to know.

eCommerce Gift Card Marketing: 8 Creative Ways to Drive Max ROI

For eCommerce, Gift cards are like the local. They have monetary value but are limited to their particular store.

They are used for customer participation like surveys, sign-ups, referrals, and improving other important KPIs.

But the value of Gift card marketing is hidden in the pure brilliance of a marketing strategy.

To put it in perspective, Gift Card Marketing motivates customers to act now while also 

encouraging them to purchase in the future.

As of the recent 2023 report, 64% of US e-commerce use Gift card marketing. And even if we talk about customers' point-of-view, gift cards have continued to be the preferred gift choice for 16 years.

It means both eCommerce and customers are happy with Gift Cards.

But let's not forget the challenges. To use Gift Card Marketing effectively, you must understand

  • What Is Gift Card Marketing?
  • Why Is Gift Card Marketing Still Working?
  • 8 Effective Gift Card Marketing Strategies For Ecommerce
  • And Ecommerce Gift Card Marketing Ideas

Here, we are going to go through each one of them. So, let's get started right away.

What is Gift Card Marketing?

Gift Card Marketing is a persuasive marketing style where businesses give gift cards to customers or potential customers to motivate them to carry out an action.

This action can vary depending on the goals of each campaign, like completing a survey, sharing a post, referring a friend, increasing cart value, etc.

Some common examples of Gift card marketing are offering $10 gift cards for customers who purchase over $100—similarly, giving $5 gift cards to your loyal customers for completing a customer survey.

In both cases, customers receive a Gift card after completing a set action. Also, in most cases, customers can only redeem their Gift during their next purchase with eCommerce.

Overall, This helps increase the customer lifetime value and reduces the cost of customer retention.

8 Effective Gift Card Marketing Strategies For Ecommerce

1. Make shoppers work for it

To make Gift Card Marketing effective, your first goal should be engaging your customer.

Today when anyone can create a Gift card and send it to the customers, engaging customers is competitive.

That is why you must make your customers work for your Gift card.

But to use Gift card marketing effectively, you need customer engagement. You need people to know about the offer, the steps they need to take, and even share it with their peers.

According to a survey done by RetailMeNot, about two-thirds of people are likely to purchase if they have a discount code.

But simply giving away an offer will only hurt your engagement. There are various ways to boost your Gift card marketing engagement.

You can ask customers to

  • Sign up today and get a free Gift card
  • Refer to a friend's $20 Gift Card to earn a $20 Gift Card.
  • Complete this survey and get a $10 Gift Card
  • Share this post and tag it to get a chance to win a $50 Gift Card

Whatever the offer may be; ideally, the goal of Gift card marketing should be to engage and ethically boost your important KPIs.

2. Encourage referral & spending

Referral is a powerful marketing tool. 92% of consumers are likely to buy a product referred to by their friends and family.

That said, motivating your customers to refer to your products is not a piece of cake.

  • Firstly, it’s not always the first instinct to share what they purchased.
  • Second, what’s in it for them?

In these scenarios, the reward for action—referral—is unclear.

And to overcome this unknown, one can easily use Gift card marketing to their advantage.

Gillette offers $5 for every referral that makes a first-time purchase over $15.

Gift Card Marketing: Referral and spending

The intent of this offer is clearly to increase new customers.

You can create a similar referral program with a Gift card marketing strategy based on your targeted KPIs. Keep the offer simple to understand, and tell what shoppers have to do to get a Gift Card.

3. Build your brand voice

Do you know that almost 80% of consumers are likely to try a new brand if they have a discount code?

If you are using Gift card marketing and reaching a new audience—their first interaction with your brand will be your Gift Card itself.

Needless to say, it is a great opportunity to build a long-term connection with your potential customers. And hence, it is important to focus on building your brand voice with Gift Card Marketing.

Building a unique brand voice means standing out from the crowd every single time you reach your customers. Using an engaging copy, product photo editing service for eCommerce products, and an overall design of the gift card.

All this plays a vital role in building a brand voice for your new and recurring customers.

Gift Card Marketing essentially helps you cultivate connection and give your brand an opportunity to engage with the customers on a one-to-one basis.

A good example here would be creating celebration-based cards. 

Gift Marketing strategy using brand voice

This is a Gift Card that Dunkin Donuts used to celebrate mothers Day. Customers can send e-gift cards to their mothers, which can be used on the store purchase of their favorite donuts.

This is an experience for both customers and the mothers. And as a brand, you can curate that and make it easy to celebrate special days.

Additionally, it is an opportunity to make your loyal customers feel valuable as well. This could be through:

  • Birthday Gift Cards
  • Loyalty Gift Cards
  • Anniversary Gift Cards
  • Father's Day Gift Card

Based on your target audience, you can build a brand voice to celebrate different occasions with your brand.

4. Capture holiday season

Taking the spirit of warm wishes ahead, you can drastically improve your ROIs with Gift Card Marketing during holidays.

As per Rise.ai, 48.28% of Gift cards sold in 2020 were during December. That is almost half of the Gift card sales.

People are on shopping sprints and eager to find the best gift for friends and colleagues. But when they don’t know the best gift, Gift cards are a lifesaver.

As an eCommerce, it is an opportunity for you to capture the special moment and reach a new wider audience.

That is why letting people learn about your Gift Cards during this critical time would be the right step. Additionally, do you know that 61% of shoppers are more likely to try new brands during the holiday season?

On top of that, what do you think will happen if they have a gift card from their friends and colleagues? At least, say, an eCommerce can see a rise in new customer acquisitions and sales.

5. Build your email list

While the holiday season might last only a few days of the year, building an email list can be valuable for years.

Even today, email has the highest conversion rate. But to use this tool effectively, creating an email list is crucial.

If an eCommerce is struggling to create an email list—Gift card marketing can boost the subscription rate.

That is why using Gift Card Marketing to build an email list and convert them is surely a profitable way to grow ahead.

6. Gift cards for survey

Gift Marketing: Gift card for completing survey

Credit - Voucherify

Understanding your customers is critical. At any stage of business, the more you know about your customers, the better it is.

Analytics can only share so much about the customers; sometimes, we need better insights.

The best way to understand customers is through primary research, that is, asking customers directly.

And for that, you need to motivate your customers to participate in a survey. Gift card marketing is at your rescue again.

You reach out to your loyal customers, who have experience with you, and request their participation. As a reward for completing the survey, they can earn a gift card from eCommerce.

7. Increase customer retention

We know customer acquisition costs are rising year on year. On the other hand, loyal customers are spending 5 to 10 times more with the brand they trust.

Needless to say, this makes customer retention an important part of any eCommerce. And here, Gift card marketing can play a critical role.

Brands all over the world—including Amazon, Walmart, Sephora, Stylebop, etc.—use it to reconnect with customers and motivate a return purchase.

Let’s have a look at an email from Parkmobile that they sent to remind a customer about the Gift Card they were offered.

Gift card marketing to boost retention

The email shares $30 with that customer, tells them how to use it, and mentions the expiry date. Overall, the email reflects its use case—customer retention.

8. Keep up with Analytics

Campaigns, messaging, ROIs, and conversion of your Gift Card Marketing strategies will vary. Some campaigns might outperform expectations, while others might not even still need to dart.

Whatever the case, your analytics will help you learn the scope of improvement.

Additionally, running A/B tests and learning which offer works and what copy engages your customer the most will be a process that needs to be documented and shared.

This process of continued analysis will not just be beneficial for gift card marketing but will even help you in other campaigns as well.

Ecommerce Gift Card Marketing Ideas

While we have gone through some effective Gift card marketing strategies above, it is equally important to know what other brands and eCommerce are doing with it.

Here are a few eCommerce Gift card marketing ideas that stand out. You can be inspired and use them for your brands. Let’s have a look.

1. Sephora - Customer Retention

Sephora Gift Card Marketing for retention

Sephora is a skincare and beauty brand that uses the following Gift Card Marketing strategy for customer retention. You’ll notice that the card is valid for the holiday season–when customers are actively buying.

The whole design and copy of the brands align with what a customer would expect from the brand—making it a solid piece of inspiration if one wants to get started with a customer retention strategy with Gift cards.

2. Outdoor Voice - Referral

Gift Card for referrals

Another use case of Gift card marketing we discussed was referral marketing. Outdoor Voice, a fashion eCommerce, uses this quite admirably.

The camping #DoingThings offers $20 for referring a friend—where even that friend will get the $20 off on the next $100 purchase.

Also, if you notice, Outdoor Voice must ask for the friend's email first. They are asking for "your email." The referral link is then shared on the email, which can be shared with the friend.

3. Nordstrom

Personalized gift card marketing

Nordstrom is a leading fashion eCommerce that also has the option to buy Nordstrom Gift Cards. But to take one step further, one can even personalize the cards based on the special days.

This additional step makes the Nordstrom Gift card stand out, especially when sent out from a known person. One can pick the designs, upload their photo and add a message which will be delivered to the receiver.

Why is Gift Card Marketing Still Working?

We know gift cards are popular among customers. Its market is projected to grow at 9% compound annual growth from 2021 to 2027. The question is, why?

It’s 2023, and customers are bombarded with emails and coupons whenever they are ready to buy something. 

Then why is Gift Card Marketing still working effectively? Let’s have a look here:

  • Convenience and flexibility: Gift Cards bring a lot of comfort for the customers and eCommerce. Customers can easily send a gift card to a person and let them choose what they want. E-commerce can use Gift marketing in various effective ways to boost conversion.
  • Increased Brand Awareness: Gift Card Marketing is a highly interactive marketing method where a brand has the potential to reach new and old customers with a network method. This is because Gift cards go directly to the target audience and can be personalized for everyone.
  • Incentives and promotions: Many businesses use gift cards as incentives or promotional tools to attract customers. They offer gift cards as rewards for loyalty programs, referrals, or other marketing campaigns. Such promotions encourage customer engagement and can lead to repeat business.

Impersonal gifting: In some situations, selecting a personalized gift, such as when giving to acquaintances or business associates, may be challenging. Gift cards provide a practical solution that allows recipients to choose something they desire.

Final Words

Getting started with Gift card marketing might be easy, but its effectiveness will only depend on how you use it.

If used correctly, Gift cards are a huge marketing asset that has the potential to reach new audiences, increase cart value, build customer engagement, and improve every essential KPI of eCommerce.

It is a tool that can be used with social media, email, SEO, referral, and more. After all, it is a tool—its effectiveness is how you use it for your eCommerce.

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