e-gift cards

How Do E-Gift Cards Work for Small Businesses: A Simplified Guide



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E-gift cards have changed the way people give and receive gifts. They offer a digital alternative to the traditional physical gift card, allowing customers to conveniently purchase and send gifts online. 

As a small business owner, incorporating e-gift cards into your offerings can provide many benefits, including increased revenue streams and improved customer satisfaction.

With the right e-gift card software, managing and tracking these digital assets becomes easy. 

In this article, we will cover the basics of e-gift cards, explain how they enhance the shopping experience, and why they should be an essential feature for businesses.

We will also guide you on creating, distributing, and managing e-gift cards with PassKit, our customer loyalty software suitable for non-tech-savvy users. 

Whether you’re new to the concept of e-gift cards or looking to optimize your existing gift card program, this guide will provide you with all the information you need.

Understanding e-gift cards

understanding e-gift cards

Image source: Canva

What are e-gift cards?

E-gift or electronic gift cards are a digital alternative to traditional physical gift cards. They include a unique e-gift card code that customers can redeem online or in-store.

When customers purchase an e-gift card, they typically receive it via email or a mobile app, providing a convenient and instant gift-giving option.

Digital gift card vs. physical gift card: What’s the difference?

The key difference between a digital gift card and a physical gift card is the format. While physical cards are tangible items that you can hold, digital versions exist in an electronic format.

They’re often more convenient for both the giver and the recipient since they can be bought and delivered instantly, reducing the need for shipping or physical handling.

The advantages of e-gift cards for small businesses

For small businesses, incorporating e-gift cards can be a method of contactless shopping which aligns with modern consumer preferences. 

These digital cards are also beneficial as they:

  • Expand your customer reach: By offering e-gift cards, you can attract customers who prefer digital solutions.
  • Increase revenue opportunities: E-gift cards can be sold and used as an alternative payment method.
  • Enhance customer convenience: Customers appreciate the ease of purchase and use, especially for last-minute gifts.
  • Promote brand awareness: E-gift cards serve as a marketing tool that promotes your business each time they are shared or gifted.

Implementing e-gift cards in your business

implementing e-gift cards

Image source: Greek Superherbs

Select an e-gift card provider

Choosing the right e-gift card provider is essential for the smooth operation of your service. Your chosen provider should offer a robust platform for creating and managing e-gift cards.

Prioritize a system that supports online purchases and multichannel distribution to maximize your reach and customer convenience.

Integrate e-gift cards with your existing systems

Ensuring a seamless integration of e-gift cards with your Point-of-Sale (POS) systems is critical. Your stores and online platforms need to accept e-gift cards without issues.

Compatibility with mobile wallets can improve this experience, eliminating the need for a physical card and catering to a digital-savvy customer base.

  • Train your staff: Educate your team on handling e-gift cards at physical and online locations.
  • Software updates: Keep all systems up-to-date to support e-gift card transactions.

Legal and regulatory considerations for e-gift cards

Adhering to legal and regulatory guidelines is imperative when implementing e-gift cards. It includes understanding expiration dates, fees, and redemption conditions that affect your customers:

  • Clear terms: Communicate gift card terms clearly to avoid any misunderstandings.
  • Compliance: Stay updated on legal requirements pertaining to gift cards in your region.

Designing your e-gift card campaign

e-gift card campaign

Image source: Freepik

Craft the design of your digital gift cards

When creating your digital gift cards, the design should be eye-catching and reflective of your brand’s identity. Incorporate your logo and use colors that resonate with your branding.

The design is not merely aesthetic but also functional. Each gift card should have a unique gift card code, which is integral for tracking and redemption purposes.

Determine the value and policies for your e-gift cards

As you decide on the value of your e-gift cards, consider offering various options so buyers can choose the one that best suits their needs, receiving a personalized customer experience.

Be transparent with your customers by providing all necessary information upfront. Clearly outline the policies, including expiration dates or any restrictions. 

It will ensure a seamless experience for the giver and the gift recipient.

Strategies for marketing your e-gift cards

Your marketing strategy must communicate the benefits and convenience of e-gift cards. In-store advertising tactics, like display stands or cashier prompts, can remind customers about the option for a digital gift.

Engage your target audience through creative POP marketing efforts highlighting the ease of sending e-gift cards.

A great way to build a loyal customer base is to offer a connected customer experience. You can leverage technology like digital wallets to keep your digital cards at the forefront of the customer’s mind.

Managing and tracking e-gift card sales

e-gift card sales

Image source: Unsplash

Monitor e-gift card sales and redemptions

To effectively monitor e-gift card sales and redemptions, you should use a system that keeps a real-time log of transactions.

When a customer purchases an e-gift card, the system records the sale instantly, marking the inflow of funds. 

Upon redeeming, the software recognizes it as a sale of your goods or services, decreasing the e-gift card balance accordingly.

Manage customer inquiries and support for e-gift cards

Customer support is crucial for handling inquiries regarding e-gift card balances or issues. Empower your customer service team with access to customers’ records and transaction histories to enable them to assist customers with their digital gift cards. 

Use sales data for business insights

Analyzing sales data from your e-gift cards can unlock valuable business insights. You’ll be able to:

  • Understand purchasing patterns
  • Assess the effectiveness of your e-gift card marketing campaigns
  • Determine the frequency and amount of e-gift card redemptions

This information helps you tailor your products and services to meet customer needs better and drive future sales strategies. Use e-gift card software with analytics tools to simplify data interpretation and inform your business decisions.

Promoting your e-gift cards

e-gift card promotion

Image source: Freepik

Build promotions around digital gift cards

For small businesses, digital gift cards can be a powerful promotional tool. By integrating e-gift cards into your marketing strategy, you directly benefit from increased brand visibility.

Create exclusive offers that encourage customers to purchase gift cards, such as offering a $10 card for every $50 spent. This approach incentivizes gifting and entices new customers to explore your products or services.

Encourage repeat business through e-gift cards

E-gift cards can be a key element in fostering customer loyalty. Use strategies like SMS marketing to promptly inform your customers of gift card deals, increasing the likelihood of repeat purchases.

Integrating e-gift cards into a broader loyalty program can further benefit the customer-retailer relationship by offering rewards for continued engagement.

Collect valuable customer data via e-gift card usage

Every e-gift card purchase can become an opportunity to gain insights into customer preferences.

Tracking which promotions lead to gift card sales and usage can refine your advertising strategies. Leverage the digital transformation benefits of e-gift card software to analyze the data gained through these transactions.

It will enable you to tailor future offers and communications to the distinct needs of your customer base, improving your overall marketing effectiveness.

Introducing PassKit e-gift card software

PassKit is the leading mobile wallet service provider offering small businesses an all-in-one platform to create, manage and distribute various digital cards using online and offline marketing channels. 

With PassKit, you can eliminate the need for custom app building. Our software also does not require coding or design skills, thanks to its intuitive user interface.

Leveraging the convenience of mobile wallets, PassKit simplifies and enhances how you can provide value to your customers through digital passes, including gift cards, loyalty reward cards, digital membership cards, digital tickets and more.

You can test all features during a 45-day free trial. Sign up now.

Create digital gift cards

digital gift cards

PassKit offers an easy and intuitive way to design digital gift cards for mobile wallets tailored to your brand. With our visual editor, the Pass Designer, you can create visually appealing e-gift cards perfect for today’s contactless transactions. 

Our loyalty card design complies with Google and Apple Wallet guidelines.

You can start from scratch or modify loyalty card templates to create the perfect card that resonates with your customers. You can infuse your brand’s identity into every card by adding your logo, selecting colors, and incorporating a hero image.

PassKit also lets you add custom fields to digital gift cards, personalizing each card. You can include the recipient’s details, such as the email, phone number, first and last name, date of birth, and expiration date.

You can also incorporate a QR code on the digital gift card, streamlining the redemption process and enhancing the user experience. 

For merchants, the PassReader app, available for iOS and Android, enables quick scanning of these codes, ensuring a seamless and efficient transaction process for the business and the customer.

Manage digital gift cards

digital gift cards

Managing your gift cards becomes seamless with PassKit’s user-friendly dashboard. You can update card details, modify designs, and manage distribution all from one central location, saving you time while maintaining full control over your digital assets.

You can also use no code automation and no code integration to connect PassKit with your tech stack and further optimize your workflow. It eliminates the need for manual management and reduces the possibility of human error.

Some examples include:

  1. Mailchimp integration
  2. Salesforce CRM integration
  3. Zoho CRM integration
  4. Marketo integration
  5. WooCommerce integrations
  6. ActiveCampaign integrations
  7. Emarsys integrations

Distribute digital gift cards

digital gift cards distribution

PassKit provides various options for sharing digital gift cards, allowing you to reach your target audience through different online and offline channels such as email, social media, or QR codes on printed materials. 

This flexibility increases brand visibility and customer engagement, ensuring customers can access your gift cards wherever they are.

For instance, you can print the QR code on the receipt with a link to the gift card or use location-based marketing to prompt users near your business to come to your store and use their gift cards. 

PassKit operates on permission-based marketing, meaning that customers have given their consent when signing up. Therefore, it’s safe to send them your updates, deals, promotions, and alerts.

Analyze digital gift card performance

e-gift card analytics

Finally, assess the impact of your gift card campaigns by analyzing performance with PassKit’s analytics tools.

You can track the usage of your digital gift cards, measure customer retention, monitor redemption rates, and adjust your marketing strategies based on accurate data to improve your customer relationships and drive sales continuously.

By integrating with your existing systems, PassKit opens new possibilities for engaging with your shoppers and streamlines how you deliver incentives through the mobile wallet revolution.

Start a 45-day free trial now.

Conclusion on e-gift cards

Integrating e-gift cards into your business is a strategic move that aligns with current consumer behaviors. These cards offer an alternative payment method that can boost revenue by facilitating transactions.

Customers can enjoy the convenience and flexibility of purchasing and sending gifts digitally, which is excellent for nurturing customer loyalty.

By tapping into the growing preference for digital solutions, you can attract new customers who value electronic transactions. Additionally, using e-gift cards can give you valuable insights into buying patterns and customer preferences, which can inform your marketing strategies.

To optimize the process and meet modern consumers’ needs, you can use PassKit as an all-in-one solution to create, manage, and distribute your gift cards seamlessly. 

Start a 45-day free trial now.

FAQs about digital gift cards

Let’s answer the most common questions about e-gift cards.

How do you use an eGift card?

To use an eGift card, you typically:

  1. Select the item you want to purchase
  2. Proceed to the checkout screen
  3. Enter the eGift card number in the payment section or upload it to your account
  4. If prompted, also include the associated PIN or security code

Can eGift cards be used in-store?

Yes, eGift cards can often be used in-store. To redeem:

  • Show the eGift card on your digital device to the cashier
  • If it has a barcode or QR code, they will scan it directly from your screen

What happens when you buy an e-gift card?

When purchasing an eGift card:

  1. You choose the card value and recipient
  2. You pay for the card via the merchant’s online platform
  3. The eGift card is then emailed or texted to the recipient, usually with a unique code or link.

Do you have to print an eGift card?

Printing an eGift card is not mandatory. You can display it on a smartphone or tablet. If preferred or required by the retailer, print out the eGift card and present the paper copy.

Remember to check with the issuing retailer for instructions or restrictions on gift card use.

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