How gift vouchers are the gift of choice for today's consumers.
Christmas is almost upon us, and director general of the UK Gift Card & Voucher Association, Andrew Johnson, is on a mission to support indecisive shoppers, fussy recipients and reactive retailers with his gift card insights. Here, Johnson explains why all retailers should offer the ‘gift of choice’ for cash-conscious customers this Christmas.
Gift cards and vouchers are a great way to give a personal gift like jewellery without running the risk of the recipient not liking your choice. For example, you may have chosen the wrong colour, the wrong size, type, brand, shape, stone and so on.
There is nothing worse than seeing a close friend or family member open a gift, only to find out that it is something they already have, don’t need, or dislike. Gift cards and vouchers are growing in popularity for this very reason, with more and more shoppers starting to see the appeal of this flexible gifting option.
RISE OF ONLINE VOUCHERS
Online shopping has now crept into our Christmas traditions, along with sitting down to a turkey and watching the Queen’s Speech. Research by the UK Gift Card & Voucher Association (UGCVA) revealed that half of consumers are likely to give vouchers at Christmas time and more and more recipients are using their vouchers to buy gifts of their choosing as early as Boxing Day — and sometimes on Christmas Day itself.
It’s easy to see the appeal for customers who seek convenience above all. For shoppers, online vouchers can provide a whole extra day to make purchases, since eGift vouchers can be purchased online and delivered instantaneously via email or SMS. Consumers can therefore buy last-minute presents on Christmas day morning and still give them before lunchtime.
Of course, many people are also going online on December 25 to spend the vouchers they received in their Christmas stockings, as many high street chains now start their Boxing Day sales early online. Although this practice may seem unorthodox, online shopping on Christmas Day is fast becoming a new holiday tradition for many people.
Multi-channel shopping currently represents a major opportunity not only for professional jewellers, but for all retailers. E-tail and business performance analysts Interactive Media in Retail Group (IMRG) and Capgemini revealed that more than a third of all online retail sales are now made on a mobile device. Visits to e-tail websites via mobile devices are also increasing, with around half (48%) of consumers visiting sites now using a smartphone or tablet device.
To capitalise on this impressive growth across all channels, professional jewellers should think about bringing their online proposition in-line with their store offering when it comes to promoting gift-giving at Christmas. For example, retailers in this sector may want to consider offering digital gift cards as part of their online and in-store promotions, so that consumers have the flexibility to redeem their vouchers both online and in-store.
Along with the flexibility that they provide for the recipient, gift cards and vouchers are also becoming a popular way for shoppers to budget for expensive gifts like jewellery. The ease of purchasing gift cards and vouchers at various points during the year can help ensure that Christmas spending is distributed over a longer period of time, rather than relying solely on December’s pay packet to cover all the costs.
The gift cards and vouchers that have been accumulated over the course of the year can then be used for payment when buying Christmas presents. Using gift cards and vouchers as a savings tool can also help to make sure that shoppers don’t build up any unwanted debt.
At the beginning of the year, figures from the British Retail Consortium (BRC) showed overall UK retail sales growth of 2.8% in the three months from December 2013 to February 2014. By comparison, data published by the UKGCVA, taken from a report compiled by consultants at business advisory firm BDO, revealed that consumer gift card and voucher sales soared in the first quarter of 2014, growing by 17%, an increase that was far above expectations.
Growth of 17% in consumer gift card and voucher sales was a very positive start to the year and a sure sign that the gift card industry is gaining momentum, especially as the first period of any given year is often seen as a litmus test for what retailers can expect for the rest of the year ahead.
Last year, the UKGCVA predicted that £2 billion will be spent on gift cards and vouchers in the run up to Christmas; given the results of the start of the year, this figure is likely to be met. The industry has already seen the popularity of gift cards and vouchers, both online and physical, grow immensely in recent years; as a result Christmas 2014 is on track to be one of the strongest for the gift card industry to date.
SO THIS IS CHRISTMAS…
Gift cards and vouchers enable consumers to give a personal gift to a loved one without worrying about finding the 100% perfect item every time. With jewellery especially, it is hard to get it completely right, so gift cards and vouchers offer the perfect way to make a loved one’s Christmas dreams come true by giving them the best gift of all – the gift of choice.
This Ask the Expert was taken from the September issue of Professional Jeweller. To read the issue in full online, click here.