Many Restaurants, Hotels Missing the Mark on Gift Cards

Gift cards are forecast to be a $160 billion market in 2018, and for the past 11 years have been the most requested holiday gift by consumers.

To assess the state of merchant gift card e-commerce landscape, NAPCO Research and CashStar, a provider of merchant solutions for gift card ecommerce, undertook a comprehensive review of the state of merchant gift card e-commerce offerings. The cross-platform assessment evaluated brands on nearly 100 criteria, including the online consumer purchase and recipient experience of digital and physical cards, as well as merchant B-to-B e-commerce offerings and the use of gift cards for marketing initiatives.

To provide a meaningful assessment of gift card programs, NAPCO Research included as many giftable verticals as possible. One hundred top merchants, determined by industry rankings, were chosen. Within hospitality, NAPCO Research studied hotels such as Hilton, Four Seasons, Omni Hotels, Hyatt, Choice Hotels, and Marriott; casual dining restaurants such as Texas Roadhouse, IHOP, Red Lobster, The Cheesecake Factory, and Olive Garden; and quick serve restaurants such as McDonald’s, Arby’s, Domino’s, Burger King and Subway.

NAPCO’s Research discovered quite a few key trends. Listed below are just a few. To view all of the trends, read the full report here.

  1. Omnichannel hasn’t made it to gift cards yet. Only 36 merchants evaluated sell both digital and physical gift cards in all of their available e-commerce channels (desktop, mobile web and, for some, mobile app). Even for merchants that sell in all available channels, the mobile experience isn’t generally at parity with their desktop experience.
  2. Not all merchants make it easy to find the gift card option online. The top performers on these criteria captured 90-plus percent, while the laggards received less than one-third of available points. Top performers have links to gift cards in menus and gifting sections of their site (if appropriate). Their search results take consumers directly to a clean, informative and brand-appropriate landing page, enticing them to move forward with their purchase. For example, Domino’s features gift cards as a top-level menu option, and its landing page (Figure 1) is easy to engage with, well branded and informative.
  3. Some merchants are falling behind on gift card personalization. It’s well documented that some gift givers have concerns about gift cards being impersonal. Merchants that don’t offer the ability to at least choose an appropriately occasioned card design and write a personal message make it really hard for some consumers to feel good about giving a gift card. Of the merchants studied, many did not offer consumers personalized options…