retailnewsalert.com » Will virtual gift cards increase sales?

Will virtual gift cards increase sales?

October 15, 2010 by Penelope Miller
Posted in: In this week's e-newletter, Latest News & Views, News, Online, Retail companies, Sales/Marketing, Technology

Will that be digital or plastic?

Nope, we’re not talking about grocery bags — we’re talking about gift cards. More and more retailers are turning to virtual/digital gift cards in hopes of boosting sales and cutting costs.

So how do they work? Shoppers buy the digital gift cards online and they’re e-mailed to friends or family.

Retailers tried out the technology last holiday season and the results were positive, with digital cards outselling their traditional plastic counterparts by about 50%.

Even better? Digital gift cards cut down on shipping and handling costs, so retailers love them.

Now, more major retailers are hopping on board. The latest: Applebee’s and American Apparel, among others.

Experts predict that digital gift cards will make up 30% of the U.S. gift card market in the next five years.

Do you think digital gift cards are the wave of the future? Can they help retailers increase sales? Share your thoughts in the comments below.

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