Who’s Your Audience: Father’s Day
by Melissa Yap
2 Min Read
Amid supply chain woes, gift cards are bigger than ever – here’s how to maximize the opportunity
5 Min Read
Over the last decade, gift cards have become big business for retailers, restaurants, and everyone in between. They’re easier and cheaper to ship, can be sent directly to an email inbox, and remove the guesswork for hard-to-shop-for family and friends. No longer relegated to last-minute gift ideas or acts of desperation, 59% of Americans had gift cards on their wish list in 2019.
Then COVID-19 happened. With the pandemic putting a temporary halt to traveling and in-person gatherings, consumers embraced gift cards more than ever – a 19% increase, with 49% of gift-givers intending to buy them. Just like how the pandemic has changed how we think about remote work or television watching habits, COVID-19 forever changed shopping habits and how consumers think about gift cards. And with a holiday season that is already projected to break sales records, there’s no doubt that millions more will be opening up gift cards this year – and it’s opening up some exciting alternative advertising ideas for marketers.
While the last few years made gift cards hotter than ever, this year is already taking them to new heights. While some people are resuming holiday travel and in-person gatherings, physical gift-giving might still be off the table thanks to one major complication: supply chain tensions. Complications tied to the COVID-19 pandemic, including lockdowns and labor shortages, are causing global supply chains to slow down or even seize up, for everything from furniture to toys.
The result has been increasingly long delays on shipments and hard-to-find hot electronics like TVs, video game consoles, computers, and more – the latter of which frequently result in long lines for retailers even when it isn’t the holiday season. Shoppers are so concerned that 52% are reporting to have started holiday shopping early to avoid supply chain concerns.
As a result of the supply chain breakdowns, 34% of shoppers plan to buy more gift cards – with 60% of Baby Boomers and 44% of women saying they’d prefer to receive gift cards over anything else. Considering the jump in gift cards last year, this is a significant number of gift cards that will be purchased and received in 2021.
But it’s not just consumers using gift cards to protect themselves against supply chain issues; brands are doing the same. As more advertisers worry about the looming holiday supply chain crisis, they find themselves in a tricky position – do you capitalize on the hot holiday season (and vital post-holiday period) with increased advertising spend, or do you dial it back significantly because your inventory may be unable to meet demand? Gift cards provide a safe escape hatch. By advertising gift cards, brands can take the focus away from promoting specific items while still providing a chance to generate revenue – regardless of current inventory levels.
So more gift cards are being exchanged than ever before – and this leads to big post-holiday purchases for brands. 33% of consumers plan to spend $20-30 per gift card, and 22% will spend more than $50. That leaves a lot of potential for additional revenue to be generated through higher-ticket items, additional purchases, impulse buys – and a chance to turn a one-time gift card user into a lifelong customer.
This lucrative venture has driven brands to find new and exciting ways to advertise gift cards throughout the holiday season. But what happens after the holidays are over? Nearly 20% of gift cards go unspent for over a year, and 3% may never be redeemed at all – totaling at least $3 billion in unspent cards. How do you reach those customers in January and beyond?
CTV takes the engaging storytelling methods of linear TV and enables brands to target their ideal customers with them – delivering the ad directly to them. Savvy brands are using CTV to drive sales and gift card purchases during the holiday with campaigns that are specifically targeted to gift-givers using criteria such as location-based targeting, gender, interests, shopping history, and more.
But once the holidays are over, these same targeting and retargeting campaigns can be applied to a new audience – the gift card recipients themselves. Thanks to the rise of digital gift cards, you already sit on a list of email addresses of people who received gift cards. With capabilities like MNTN’s Performance TV CRM targeting, you can easily upload these addresses to deliver CTV ads directly to that audience. This gives you a direct line to these valuable shoppers, and offers the opportunity to upsell and generate more dollars per sale. It’s a major reason why you should consider integrating CRM targeting into your CTV strategy. Granted, not all CTV advertising solutions offer this as an option, which is why we recommend Performance TV (along with a few other additional reasons below).
For brands, gift cards are a golden opportunity to continue driving sales, preventing the infamous Q4/Q1 drop-off – and Connected TV helps to ensure that these valuable gifts are spent. Thanks to its unique targeting and television retargeting capabilities, there has never been an easier way to get customers to buy your products and services. Who knows – next year they might be buying your gift cards for people on their wish list too.