The gifting economy is booming. Merchants who capitalize on it stand to win big, so it’s no surprise that CFOs and their teams are interested in capturing more of the gifting market share.
The gifting economy is booming. In the U.S. alone, the gift cards market is projected to cross $221 billion by 2024*, and the global personalized gifts market is expected to reach $43.3 billion by 2027**. Merchants who capitalize on it stand to win big, so it’s no surprise that CFOs and their teams are interested in capturing more of the gifting market share. Motivated shoppers, new revenue opportunities, and billions of dollars on the table—what’s not to love?
The bad news first: The tools most merchants and retailers have at their disposal to convert gift shoppers are limited at best. Worse, these tools can create new problems for finance teams—from minor annoyances to significant monetary losses.
Take gift cards, for instance. Yes, they’re a powerful way to convert gift-shoppers who (like most of us) have no idea what to buy for someone else. But time-to-redemption can take ages, and that means finance teams are often stuck carrying liability on the books. And while gifting surges, such as holidays, lead merchants to offer expedited shipping—a useful tool to convert last-minute gift shoppers before a big holiday—that can lead to lower profit margins from subsidizing shipping costs. There’s also the cost of returns that comes from unwanted gifts—a necessary evil of gift-buying that finance leaders would happily do without.
Now the good news. As we designed our Gift Experience Management (GXM) platform, we realized that we could do more than just solve a few headaches for finance leaders—we could help unlock big revenue and profitability opportunities in the process.
Here’s how CFOs and their teams can leverage GXM to tap into the gifting economy.
Driving Revenue with GXM
When potential gift-buyers show up to your e-commerce site, their path to purchase is often riddled with barriers because buying a gift means answering all sorts of difficult questions. What size do they wear? What color would they like? What if they already have this? Do I have their current address? And the answer to those questions—or the lack thereof—ultimately can lead to cart abandonment. But e-commerce sites equipped with GiftNow’s product gifting capability give these customers a way around all those barriers, to help enable conversion. GiftNow can also help streamline and personalize the giving of gift cards.
What’s more, by offering a shopping journey tailored for gift buyers, your marketing team can tell new kinds of stories and attract new demographics. For example, a man who usually steers clear of buying jewelry for his wife might feel empowered to purchase it via GiftNow, knowing she will still have a chance to modify or exchange her gift before it ships.
Speaking of marketing teams—our GXM platform comes with some really interesting promotional capabilities for merchants with gift card programs or those that are looking to start them, so they can actually run campaigns (such as BOGO/GOGO) that incentivize buyers with gift cards. Now, instead of discounting products and lowering your profitability, you can drive purchases with a gift card that acts as a cart starter for further shopping.
Our GXM platform offers a robust and expanding network of corporate gifting clients who use brand-name retailer merchandise for gifts for everything from HR campaigns to sales and marketing to events. Merchants and retailers who use GiftNow suddenly open themselves up to this new, growing market of corporate gifting—for a chance at untapped revenue opportunities.
Boosting Profitability with GXM
It’s no secret that return shipping costs eat away at profits, but for many retailers that’s just the cost of converting gift shoppers. On the other hand, when customers send gifts via GiftNow, recipients have a chance to modify or exchange items—before they ship. That means we can greatly reduce (or totally eliminate) the high costs of returns that gift-giving often creates.
Because gifts are delivered digitally, even last-minute gifts can ship at the most economical rate. That means there’s no need to offer expedited shipping for the gift to arrive on time— big win for buyers, recipients, and your bottom line.
Finally, let’s talk about gift cards. GiftNow can help you improve gift card programs by letting you leverage our expertise to optimize and manage your programs for you. Beyond promotions and improved personalized gifting experiences, GiftNow can help address fraud as, for many merchants and retailers, fraudulent charges eat away at profits. Our proprietary fraud scoring system helps make sure that most every transaction is legitimate; it can approve up to 99% of gift card orders instantly. We’re confident enough in it that we cover any fraudulent credit card transactions—so you can worry less about losing money on a fraudulent gift card order.
Summing It Up
For finance leaders who are ready to turn the minor nuisances gifts sometimes create into a powerful weapon to help boost profits and revenue, connecting the GXM platform couldn’t be easier. It only takes as little as four weeks, and requires minimal IT resources.
Jenn Muller is the Chief Marketing Officer for GiftNow
*Research and Markets – U.S. Gift and Incentive Cards Market to Cross $221 Billion by 2024, Despite COVID-19 Related Challenges – June 8, 2020
**Research and Markets – Personalized Gifts – Global Market Trajectory & Analytics – July 2020