How Merchants Can Benefit From Gift Card Support On Mobile Payment Platforms | EJ Gift Cards

Mobile payment platforms like Apple Pay, Android Pay, and Samsung Pay are quickly growing in popularity, and they already represent the future of payment systems.

Though the specifics of each specific platform differ, their overall goal is the same – provide smartphone users with a simple, intuitive method of payment that allows them to streamline the use of credit, debit, gift, and loyalty cards.

Using advanced NFC technology, mobile payment platforms offer a simple and highly secure method of payment – especially because most major platforms require fingerprint identification or a PIN number to complete a transaction.

And though the adoption of mobile payment platforms by consumers has been somewhat slowonly 37% of consumers report using a mobile wallet like Samsung Pay, Apple Pay, and Android Pay – most merchants are already able to accept debit, credit, and gift cards that are stored in virtual wallets.

These mobile wallets offer quite a few benefits to merchants, especially as gift cards gain increased support on Apple Pay and Android Pay. Merchants love selling gift cards, and mobile wallets offer yet another sales channel where gift cards can be sold, and customer satisfaction can be increased – especially due to simple loyalty card integration.

In this article, we’ll take a look at 7 of the ways that gift card support on mobile payment platforms can benefit merchants, and can increase gift card sales – and profits!

1. Unlimited Loyalty Card Capacity Means More Signups

Loyalty programs are fantastic for driving consumer loyalty, and offering rewards to customers who make use of your products or services. But many people are already members of quite a few loyalty programs – and that can make it difficult to convince new customers to join your loyalty program.

This is especially true when you consider the physical nature of most loyalty cards – they can take up a huge amount of space in a wallet or purse, making it pretty much impossible for most people to carry more than a few loyalty cards to their favorite stores.

However, all major mobile payment platforms now support loyalty card integration. Instead of carrying around a half-dozen loyalty cards, customers can simply scan individual loyalty cards, upload them to their mobile wallet application, and have them on-demand immediately.

Because of this, customers who use mobile payment platforms are far more likely to sign up for a loyalty program. The discounts, free gift cards, and other benefits offered by loyalty programs are very tempting for customers – especially when they know that they don’t have to carry their loyalty card with them wherever they go.

2. Gift Cards Are Less Likely To Be Forgotten – Or Lost

Losing a gift card can be extremely frustrating for consumers – and there is often no good way for them to get the balance of their gift card back when they lose it, unless they have a proof of purchase or can furnish some other information about the sale.

And though merchants do make money when gift cards are sold – not when they’re used – this “breakage” can be a big problem for merchants, because unredeemed gift cards are still counted as liabilities in retail accounting. This means that companies must maintain assets to counteract the liability load of all outstanding gift card balances – leading to some tricky accounting situations.

Losing or misplacing a gift card can also lead to a poor retail experience, and reduce consumer trust in a merchant if the balance is not reissued.

However, mobile payment platforms offer a very simple solution to this. Recipients of gift cards can simply scan the gift card that they receive, creating a backup that can’t be lost, stolen, or misplaced. This allows consumers to have more flexibility, and use their gift cards both physically and digitally.

Digital wallets can also encourage impulse purchases. Many people don’t keep their gift cards with them at all times – instead preferring to save wallet space, and take gift cards with them only when they’re planning to make a purchase.

Digital wallets ensure that customers always have their gift cards with them – so they’re much more likely to stop by a store when they pass by, and are encouraged to spend their gift card balances. This is extremely beneficial for retailers, because up to 65% of consumers spend more the balance of their gift cards!

3. Makes E-Gift Cards Easier To Use

E-gift cards are a rapidly-growing sector of the gift card market. These all-digital gift cards are easy to buy, redeem, and use online – but they can often be confusing when used in person.

Some digital e-gift cards provide barcodes that can be scanned by POS systems to redeem their balance in-person, while others require users to print out a physical bar code to be used in person. There is no standard in place for e-gift card redemption – so this can lead to some confusing situations for customers.

Mobile payment platforms offer a great way to standardize e-gift card redemption. Instead of dealing with confusing emails, printouts, and non-standardized redemption methods, customers can simply add the information on their e-gift card to their chosen mobile payment platform.

Merchants who support this feature could enjoy dramatically increased sales of e-gift cards. In a recent survey by CardCash, 50% of respondents said that they would prefer a digital e-gift card solution to an e-mail printout, and 53% of all surveyed respondents said that they were “highly interested” in storing gift cards on their phones.

4. Location-Based Offers Can Help Drive Sales

Smartphones offer a fantastic way to connect with customers when they’re near your store. Location-based marketing technology is becoming more common as retailers develop first-party apps that can utilize the power of GPS and location services to drive sales, and provide special promotions. When combined with the power of digitally-stored gift cards, location-based offers can be extremely powerful marketing tools.

Starbucks is a great example of the power of location-based offers. Recently, Starbucks began offering an “order ahead” option on their MyStarbucks app, which provided users with the ability to check into a nearby Starbucks and place their order ahead of time.

This doesn’t just make things more convenient for busy customers – it provides Starbucks with yet another opportunity to connect with customers, and market their products. A customer who may have simply had a coffee at the office might be tempted to buy Starbucks instead!

Other retailers should take notice of this innovation. First-party mobile application, smart targeted mobile advertisements, and location-based promotions and special offers are a fantastic way to drive more sales to businesses.

Here’s a hypothetical example. A customer has a $15 Target gift card uploaded to their Apple Pay account, and is walking through an outdoor mall, heading towards a sporting goods store.

They may have forgotten all about that Target gift card – but as they walk past Target, a notification pops up on their smartphone! “Come into Target now to spend your gift card balance – and take 10% off of your order!”

Not only is the customer reminded of their gift card, they’re encouraged to make an impulse buy in an unobtrusive manner – and they’re given a special promotion that makes them even more likely to make a purchase!

5. Increased Omnichannel Gift Card Sales


While digital gift cards and physical gift cards are both common, there are still few merchants who offer truly consistent omnichannel gift cards.

Omnichannel gift cards are a growing trend in the world of retail. They can be purchased either online or in-person, and then used at both brick-and-mortar retail establishments and for online orders.

Retailers like Target have adopted this strategy – customers can purchase either digital or physical gift cards, and then register them with their online accounts. This allows them to be used either physically or digitally.

Mobile wallets offer a fantastic way to help increase omnichannel gift card sales, because they allow digital gift cards to be stored on mobile devices, and used more easily in-person. As mentioned in the E-gift cards section, ease-of-use is a huge limiting factor in the adoption of digital gift cards – including omnichannel offerings.

Because mobile wallets offer a central, all-in-one location where digital, physical, and omnichannel gift cards can be stored, consumers don’t have to worry about differentiating between the different types of gift cards they have. They can quickly and easily spend gift card balances – whether they’re online or in a store.

6. Low-Value Gift Cards Become More Convenient To Use

Many customers who don’t spend the full value of their gift cards are left with low-balance gift cards that are a bit difficult to spend. Nobody wants to carry around a gift card that only has a balance of $5, so these gift cards often linger unused in junk drawers, collecting dust until they expire.

Mobile wallets offer a perfect solution to this issue. Just like loyalty cards, gift cards can easily be stored in mobile wallets – no matter what their balance may be. This ensures that customers are always able to spend the balance that remains on their gift cards.

This doesn’t just benefit customers, either – it benefits retailers. When customers use up small remaining balances on their gift cards, they’re highly likely to augment the price of purchase with cash – and that means increased sales, and more profits for merchants.

Customers will also be more aware of the gift card balances that they have remaining. Whenever they open up their digital wallet app, they’ll see a full list of the gift cards, loyalty cards, and other cards that are registered to their device. This awareness is a powerful marketing tool – a customer is much more likely to visit your store if they have a gift card that can be spent there, even if the remaining balance on the card is quite low.

7. Mobile Payment Platforms Are Highly Secure

Mobile payments and digital wallets are highly secure. Android Pay, Apple Pay, and Samsung Pay all conform to US standards for data security, and are encrypted to protect the personal information of customers.

This is true both for credit and debit transactions, as well as gift card transactions. Even if a smartphone is lost or stolen, the information held within mobile wallets like Android Pay, Apple Pay, and Samsung Pay is encrypted, and can’t be accessed without a password, PIN code, or fingerprint scan.

In addition, all major smartphone manufacturers now provide users with remote backup, data wiping, and phone tracking tools – if a phone is lost or stolen, it can simply be wiped, and any sensitive data contained on the phone will be destroyed.

This is a good thing for retailers – high-profile data breaches like those suffered by Target and Home Depot can be very expensive, and seriously damage consumer trust. By supporting mobile payment platforms, retailers can help protect themselves and their customers – and that’s a win-win!

Got Gift Cards You Don’t Need? Sell Them With EJ Gift Cards Now!

Mobile payment platforms are a huge step forward in the world of gift cards, offering a wide variety of benefits to retailers and customers alike. As time goes on, it will certainly be interesting to see which merchants begin adopting mobile payment platform support for gift cards, and see the effects this shift has on the industry.

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