Gifting a Growing Opportunity for Travel, Entertainment Brands as Consumers Value Experiences

As part of the 2018 Merchant Gift Card E-Commerce Evaluation, a comprehensive report produced by digital gift card solutions provider CashStar, in partnership with NAPCO Research (NAPCO Research and Total Retail both are brands of parent company NAPCO Media), a cross-platform evaluation was done to assess 100 leading brands on more than 100 unique criteria, including the online consumer purchase and recipient experience of both digital and physical cards (e.g., payment and delivery options, ease of discoverability); business-to-business (B-to-B) e-commerce offerings; personalization options; and the use of gift cards for marketing initiatives. As part of that assessment, the brands were segmented and ranked by product category. This article analyzes the performance of the brands in the travel (airlines and hotels) and digital entertainment (e.g., iTunes) categories.

Consumers have not traditionally associated gifting and gift cards with the travel and entertainment categories, and that's reflected in the performance of the brands in these segments. The brands in the travel categories achieved, on average, 36 percent of the total points possible across all criteria, significantly lower than the overall average of 44 percent for the 100 brands evaluated. And the brands in digital entertainment category fared even worse. They achieved an average score of 24 percent, the lowest among all product categories assessed in the report. The brands in these categories haven't viewed gift cards as a consistent revenue channel for their businesses, and therefore haven't invested the time and resources necessary to optimize their e-commerce gift card programs.

However, consumers’ increasing preference for experiences over things, particularly among millennials and younger generations of shoppers, should be reason for brands in the travel and digital entertainment spaces to rethink their approaches to gifting and the value an optimized e-commerce gift card program can provide their businesses. Consider that more than three in four millennials (78 percent) would choose to spend money on an experience or event over buying something desirable, according to a recent Harris study. That statistic should be music to the ears of brand marketers in the travel and entertainment sectors.

So what areas of the e-commerce gift card programs for travel and digital entertainment brands need the most work? According to the report, the brands in these categories should be focused on ease of discoverability (including within site search results); offering alternative payment options; B-to-B programs; and optimizing the customer experience, including for self-purchase.

A positive trend to emerge from the report is that of the five brands that showed the biggest year-over-year improvement in points achieved, three of them were in the travel and digital entertainment categories. Delta Air Lines posted a 26 percent year-over-year improvement in total points captured, good for the second largest increase for all of the 100 brands assessed. Air Canada was able to improve its score 21 percent year-over-year, while iTunes saw its score increase by 19 percent.

The top three performers in the travel category were Delta Air Lines (56 percent of the total possible points achieved), Marriott (52 percent), and Hyatt (42 percent). For the digital entertainment category, the top performers were Fandango (44 percent), iTunes (43 percent), and Xbox (26 percent).

Make sure to access the full report, 2018 Merchant Gift Card E-Commerce Evaluation, which includes all of the rankings (including by product category) as well as more valuable trends and insights gleaned from the data (including real-world examples), as well as tips for brands on how to improve their e-commerce gift card programs.