© 2012 FuzeBuy

E-Gift Card Report

March 2, 2012

E-Gift Card Holiday Results

Gift Card Market

E-Gifts in Mobile & Loyalty Programs

The Truth about E-Gift Cards

© 2012 FuzeBuy

E-Gift Card Holiday Results

FuzeBuy’s recent study on online gift card sales reveals amazing growth in e-Gifting for

the 2011 holiday season and beyond.

With the growing popularity of e-Gift cards among consumers, a number of brands have

added e-Gift cards to their existing physical card shopping cart in the past year.

The study shows that during the holiday season (October 1st

through December 31st

) an

average of 33% of sales moved to e-Gift cards this year; one fortunate brand experienced

a sales move to e-Gifts of nearly 55%!

Not only are e-Gifts becoming more prevalent in online gifting, but by adding the

solution, brands realized an increase in the total dollars in overall gift card sales. The

results show that brands have seen as much as a 99.93% increase in their gift card sales,

nearly doubling overall sales year over year. Even on the lower end the results are

impressive, with the minimum gift card sales growth of over 19%.

2010 2011

Overall Gift Card Sales

66%

34%

Gift Card Sales by Category

Physical Gift Cards

E-Gift Cards

© 2012 FuzeBuy

Randy Fox, Managing Director at FuzeBuy, commented, “It was a

great season. We are so happy to see our client’s growing their

revenues with our solutions … and the consumer demand and

success of e-Gift cards last year resulted in new opportunities for

2012.”

“I believe what also helps revenue growth is when clients take advantage of the wide

range of promotions we can implement,” Fox explained.

A total of 84% of FuzeBuy’s clients offered shoppers at least one promotion during the

2011 holiday. Deals ranged from free shipping on physical gift items, promotion codes,

discounts, a bonus gift card or merchandise with purchase, and specially priced gift sets.

“We are so happy that we added the e-Gift card option to our online

store,” remarked Angela Reed from Morton’s The Steakhouse. “We are

very pleased with the increase in revenue that it generated. E-Gifts

brought $500,000 in the first three months, which was much more

than we anticipated!”

© 2012 FuzeBuy

Gift Card Market

These findings are right on par with the growing gift card market. E-Gifts are estimated at

4% of entire industry sales and at least 8 million consumers are purchasing e-Gift cards

now.3 However, only 59 of out of 100 largest online merchants allow customers to buy e-

gift cards from online or mobile sites.2 FuzeBuy expects this number to grow even more

as, overall, gift cards have ranked as the number 1 requested gift item for several years.

In fact, the gift card business has been steadily increasing as a sound revenue strategy for

a decade.

Not only are gift card sales increasing, but the average value of a purchased gift card is

on the rise with a lift of over 23% from 2010 to 2011.1

Sales of Gift Cards by Year

• $19 billion in 1999

• $32 billion in 2001 — 68% increase

• $38 billion in 2002 — 19% increase

• $45 billion in 2003 — 18% increase

• $55 billion in 2004 – 22% increase

• $83 billion in 2006 — 66% increase

• $97 billion in 2007 — 17% increase

• $91 billion in 2008 – 6% decrease

• $87 billion in 2009 – 4% decrease

• $97 billion in 2010 – 12% increase3

© 2012 FuzeBuy

E-Gifts in Mobile & Loyalty Programs

Consumers want e-Gift cards in every available channel they can access. Solutions now

give brands the ability to offer loyalty members the choice to receive their rewards

virtually (as an E-Gift) or as a traditionally mailed reward.

Although the numbers vary by program, one

retailer has 70% of their consumers

requesting their reward virtually.

This delivers the reward to the consumer

faster, saves the brand money and also allows

multiple marketing touches to maintain

engagement.

With virtual delivery, mobile is the obvious new frontier. In fact, when asked in a recent

survey, ¼ of respondents claimed that they would purchase an e-Gift if they could store it

in a mobile app.1

By offering a well comprised mobile engagement app, consumers

can add e-Gifts, loyalty cards and coupons by selecting to deliver

from the retailer’s shopping cart, manually entering a code, or

scanning a QR code that brings the offer straight to their personal

app. Merchants can also push loyalty rewards, offers and banner

advertisements straight to the app based on location.

This creates a two way relationship with their consumers on a

virtual and mobile level which is easy to track and analyze.

In addition to marketing campaigns, a mobile app (versus a mobile card

wallet) lets the brand offer coupons and discounts via Facebook and

Twitter, SMS or email to truly engage consumers. This ultimately drives

results of higher spend and frequency.

70%

30%

Reward Preference

Virtual Reward

Physical

Reward

© 2012 FuzeBuy

The Truth about E-Gift Cards

From the numbers above, it’s obvious that a number of retailers are still weary of

implementing e-Gifts. However, FuzeBuy’s report proves that e-Gifts are gaining in

popularity and increasing overall gift card revenue. There are truths about e-Gifts that

can’t be ignored:

Brands

- E-Gifts are cost-effective to implement

- Increase overall gift card revenue

- E-Gifts can be used for customer service

- Brands reward loyal shoppers with e-Gifts

- Use for giveaways for promotions / prizes

- E-Gifts are easily delivered and shared through Facebook and

Twitter

- Integrate to the brand’s mobile app

Consumers

- Allow sending an instant gift for any occasion

- E-Gifts can be personalized for the recipient

- Know they are safe and secure to send

- E-Gifts are easily stored and accessed for redemption

This white paper was sponsored by FuzeBuy, an organization that develops proprietary marketing platforms that

engage consumers and make buying an exciting and rewarding experience. They offer gift card shopping carts that

include e-Gift cards, physical gift cards and merchandise. They also specialize in developing loyalty programs and

mobile engagement apps for retailers and restaurants. Contact FuzeBuy today at powernow@fuzebuy.com or at

855.FUZEBUY.

Sources: 1. First Data. “Consumers Insights into the U.S. Gift Card Market: 2011,” www.firstdata.com, January 23 2012 2. Airoldi, Donna M. “Digital Gift Cards on the

Move.” Incentive Magazine, January 13th 2012. 3. Bankrate, “Gift Cards Go Virtual,” www.foxbusiness.com/personal-finance/2011, November 7th 2011, January 24,

2012