Consumer Awareness of Mobile And E-Gift Cards Spikes Significantly in Just One Year

Plastic gift cards remain king, but consumer awareness of mobile and electronic gift cards is increasing. That’s one result from the Retail Gift Card Association’s survey about gift card use. The survey canvassed more than 1,000 consumers.

In the survey, fully 49.7% said they understand how to redeem a mobile or e-gift card, up significantly from 4% a year ago.

Additionally, 33.4% said they were very comfortable using mobile and e-gift cards, with 24.6% being somewhat comfortable, 12.6% not very comfortable, and 29.4% not having used one yet.

But that could change, especially as consumer reliance on smart phones for commerce increases, suggests Timm Walsh, chairman of the association’s board, and vice president of corporate sales at Regal Entertainment Group, a Knoxville, Tenn.-based movie-theater chain.

Smart-phone usage is still developing among consumers, especially for mobile wallets. Walsh says gift cards are on par with credit and debit cards for what consumers want to use with their mobile wallets. “If you can store a credit card on a smart phone, then there’s no difference with a gift card,” Walsh tells Digital Transactions News. “Consumers are going to drive that request.”

Mobile and e-gift cards typically are used when there is not a face-to-face exchange, Walsh says. Consumers still prefer to provide plastic gift cards in a traditional gift exchange.

Walsh says mobile and e-gift card use is growing at Regal, but remains a “pretty small aspect of overall business.” Regal has offered mobile gift cards for a couple of years.

A preference for plastic appears enshrined this holiday season. Most consumers—46.1%—prefer providing cashiers with a physical card, the survey said, with 43.4% indicating no preference and 10.6% preferring a mobile or e-gift card.

Many consumers—64.5%—would be willing to switch from a plastic gift card to a mobile or electronic one if a promotion was attached to its purchase. Such measures may be essential for merchants. “It’s an extremely competitive marketplace between retailers,” Walsh says. “Just like anything else, people are looking for deals.”

That’s the opposite of consumer notions about promotions for plastic gift cards. Most—58.3%—do not wait for a promotion to buy a plastic gift card.

This holiday season, most consumers, 68%, plan to choose plastic gift cards, compared with 5.9% selecting a mobile gift card, and 14.7% an e-gift card. A portion—24.6%—chose none of three options. Still, 62.4% of consumers want the option of giving either plastic, mobile, or e-gift cards. Only 37.6% said that flexibility was not important to them.