Social norms stopping digital gift cards from reaching full potential

By our News Team | 2023

Many recipients prefer receiving digital gift cards, but givers worry that these cards won’t be perceived as ‘being thoughtful’.

Gift cards are a well-established business and marketing tool and, with the world going increasingly digital, it’s not unreasonable to expect physical gift cards to be making way for digital versions.

But you’d be wrong. Research coming out of the US finds that most gift givers likely won’t choose a digital gift card over a physical gift card, even though many recipients would prefer the digital option.

Gift Cards

Photo credit: Pmsyyz via Wikimedia Commons

The study by West Virginia University has been published in the peer-reviewed academic journal, Psychology and Marketing.

“These studies looked at the psychology involved in giving and receiving gift cards. Across the board, they showed that givers are less likely to choose digital – as opposed to physical – gift cards than recipients are to prefer to receive them. This asymmetry occurs partly because givers overestimate the extent to which recipients see digital gift cards as violating the social norms of gift-giving,” explains gifting expert Julian Givi, an Assistant Professor of Marketing at the university.

“Givers may worry that digital gift cards won’t be seen as thoughtful. Whereas physical gift cards require a giver to go to a store and purchase the gift card, digital gift cards require only a minimal amount of time and effort, as the giver can quickly obtain one online.”

He continues: “And a digital gift card is more likely to imply that the giver waited until the last minute to purchase a gift. This is all inconsistent with what we think about when it comes to gift-giving norms.”

Easy to use and hard to lose

However, while givers often feel that “physical gift cards are superior in terms of desirability,” recipients are likely to see digital gift cards as “superior in terms of feasibility,” Givi said. “They’re easier to use and harder to lose.”

Indeed, his data demonstrate that when givers consider how they themselves would feel about receiving a digital gift card as a present, they’re more likely to give a digital gift card to someone else.

One study that moved the needle on givers’ openness to considering digital gift cards involved participants imagining giving a digital gift card as a gift for a birthday that was identified as happening during ‘National Digital Gifting Month’.

The researchers invented that event as an analogue to Cyber Monday, but Givi said the results showed that “givers were more likely to opt for digital gift cards when there was an occasion that altered their perceptions of gifting norms”.

That discovery offers retailers options for pushing digital gift card sales through occasion-based promotions, and Givi said he’d advise marketers “to promote their digital gift cards in ways that reduce givers’ concerns about norm violations – for example, by indicating that digital gift cards are becoming more popular and thus more in line with gifting conventions”.

Despite giver anxieties, digital gift cards are increasing in popularity – the global market grew approximately 15% from 2015 to 2020, when it reached US$258-billion. With similar growth expected over the next decade, the digital gift card market is projected to reach more than a trillion dollars by 2030.

You can find out more about the research here.

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    Dr Kin Kariisa

    Group CEO - Next Media

    Dr. Kin Kariisa is an extraordinary force at the helm of Next Media Services, a conglomerate encompassing NBS TV, Nile Post, Sanyuka TV, Next Radio, Salam TV, Next Communication, Next Productions, and an array of other influential enterprises. His dynamic role as Chief Executive Officer exemplifies his unwavering commitment to shaping media, business, and community landscapes.
    With an esteemed academic journey, Dr. Kariisa’s accolades include an Honorary PhD in exemplary community service from the United Graduate College inTexas, an MBA from United States International University in Nairobi, Kenya, a Master’s degree in Computer Engineering from Huazong University in China, and a Bachelor’s degree in Statistics from Makerere University.
    Dr. Kariisa pursued PhD research in Computer Security and Identity Management at Security of Systems Group, Radboud University in Nijmegen, Netherlands. As a dynamic educator, he has shared his expertise as a lecturer of e-Government and Information Security at both Makerere University and Radboud University.

    Dr Kin did his PhD research in Computer Security and Identity Management at Security of Systems Group, Radbond University in Nigmegen, Netherlands. He previously served as a lecturer of e-Government and Information Security at Makerere University in Kampala, Uganda and Radbond University in Netherlands.

    Dr Kin did his postgraduate courses in Strategic Business Management, Strategic Leadership Communication and Strategies for Leading Successful Change Initiatives at Harvard University, Boston USA.

    • Other current and previous roles played by Dr Kin Kariisa:
    • Lecturer of e-Government and Information Security to graduate students at Makerere University, Kampala and Radbond University in the Netherlands
    • Director of Eco Bank Uganda Limited, one of the largest banks in Africa
    • Chairman of the National Association of Broadcasters, an umbrella industry association for all Television, Radio and online broadcasters in Uganda.
    • Chairman of Board of Directors of Nile Hotel International, that owns the leading hotel in Uganda, Kampala Serena Hotel.
    • Chairman of Board of Directors of Soliton Telmec Uganda, the leading telecom company in Optic fibre business managing over 80% of optic fibre in Uganda.