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Shelley Hunter

5 Things Consumers Need to Know about eGift Cards

The most-talked about gift card of the holiday season isn’t even a card. Below are five tips to help you successfully deliver electronic gift cards and safeguard against common pitfalls.

egift card on smartphone

Electronic gift cards, also known as egift cards, digital gift cards, mobile gift cards and virtual gift cards, all refer to gift codes (see, they’re not even cards) that are delivered using technology such as email, SMS text, social media and smartphone apps. Although this new way of gifting is the talk of the holiday season, relatively few consumers have sent or used digital gift cards to date. But that is about to change. According to a 2014 survey by leading gift card manufacturer, Incomm, 75% of respondents will have purchased at least one digital gift card in 2014. I expect that statistic to go up slightly again this year.

So what should these newcomers watch for when making the leap from physical to virtual cards? Below are five things consumers need to know in order to have a positive egift card experience.

1. Timing is Everything

One of the primary benefits of sending gift cards electronically is that the gift can be sent almost immediately (and free of charge!). Although egift cards make great last-minute gifts, I suggest allowing a small grace period (15 minutes or more) between the time you order the card and when you absolutely need to have it delivered. Because gift card issuers will have to approve the transaction, run it through fraud screening processes and complete the delivery electronically, you’ll want to leave yourself time to address any unforeseen issues. (Imagine thinking an egift card got delivered only to find an “undeliverable email” message in your own inbox later that day.)

TIP:

Order digital gift cards through websites and apps that allow you to schedule delivery. That way you can place the order whenever it is convenient for you, but still hold delivery of the egift card until a more appropriate date and time (e.g. Christmas Eve, before the birthday party, on the morning of your anniversary, etc.). Here is a list of merchants that will schedule egift card delivery.

2. The Right Address is Critical

The egift card issuer’s obligation is fulfilled when digital delivery is successful–regardless of whether or not you entered the contact information correctly. I once sent an egift card to my daughter via email. When it didn’t arrive after more than an hour, I checked my purchase receipt and discovered that I’d transposed a couple of letters in her email address. The issuing company graciously corrected the address and resent the gift for me, but they didn’t have to. Terms and conditions on several merchants’ websites clearly explain that an egift transaction is complete when delivery confirmation is received. Moreover, egift cards cannot be rescinded once redeemed. Had another person opened the transposed email and claimed the gift card, I likely would have been out the entire purchase amount.

TIP:

Double check all contact information entered (including your own) when buying an egift card. Send virtual gifts with the same care you would exercise when sending money electronically such as through an electronic payment or a wire transfer.

3. You May Have to Follow Up

Successful delivery means that the technology worked–the email got delivered, the text message went through, the post went on Facebook and so forth. Successful delivery does NOT mean that the recipient actually received (or noticed) the gift.

I once sent an egift card to my brother via a smartphone app. Although he received a text message from the app, he didn’t recognize the sender. When he had trouble clicking the link contained in the text, he gave up and ignored it completely. A couple of days later, I called my brother to see if he had gotten any surprises. “Nope,” he replied. Through further “big sister” questioning, I discovered that he didn’t have a smartphone. I called the issuing company and they said he could access the gift through email on his computer instead. After digging through junk mail folders, spam folders and refreshing the inbox several times, he still had no gift. As it turns out, my brother has at least three email addresses. I had sent the gift to one, but he was checking the other.

TIP:

Send electronic gift cards to the technology most used by the recipient, and confirm contact information ahead of time. If you’re not sure which email address is preferred, send a friendly exploratory email to see if you get a response. Do the same with a cell phone number or social media account. Don’t wait until your egift is lost in cyberspace to ask, “which email address do you prefer?” If you don’t hear from the recipient within a reasonable period of time, follow up.

4. Some eGifts Only Work Online

Although many egift cards can be used in stores, some merchants restrict egift card redemption to online purchases. Requirements such as this should be clearly stated on the store or restaurant’s website. On the DICK’S Sporting Goods website, for example, it reads, “DICK’S Sporting Goods Online Gift Certificates are redeemable online only and not at DICK’S Sporting Goods retail stores.” Conversely, the Best Buy website says “Best Buy e-gift cards are redeemable for merchandise at any U.S. Best Buy retail location or online at BestBuy.com.”

TIP:

Before buying an egift card, check to see where it can be used. If only redeemable online, consider giving an amount that will cover potential shipping charges. If redeemable in stores, confirm how the gift code can be presented at the cash register. In most cases, the recipient should be able to either print the email received at home and present the paper copy to a cashier or simply show an electronic (e.g. email, screenshot, gift card app screen) version of the code instead. Here’s a list of merchants that make it easy to print egift cards at home.

5. Lost eGift Cards are Not Lost

Physical gift cards can be purchased fairly anonymously and are difficult to replace if they get lost. But egift cards are different. These cards are typically ordered online where the buyer enters an email address, credit card number, physical address and possibly even a telephone number before completing the purchase. The recipient, who likely has to claim the code in some way, also ends up supplying contact information. With all of these identifiers, egift cards are easy to trace and replace if the recipient can’t find the original notification.

Additionally, some of the most common gift card fraud practices are a non-issue as well. Since there is no packaging to tamper with, no way for thieves to swipe blank physical cards from the rack, and transactions are mostly automated, egift cards are considered more secure than their plastic predecessors. (If your wallet gets stolen, you don’t lose virtual gift cards. If your phone gets stolen, links to your egift cards are inaccessible as long as your phone and apps are password protected.) That’s not to say electronic gift cards are fraud-proof, it’s just that the majority of the fraud will happen directly to the merchant versus the unsuspecting customer.

TIP:

Enter all physical and virtual gift cards into a gift card app or mobile wallet. Not only will doing so make it easier for you to present gift codes to a cashier (some even create virtual barcodes that can be scanned), having all of your cards in one place will help you remember to use them.

Despite these potential problems with egift cards, we’ve experienced rapid improvements over the last two years. As a frequent buyer and user of digital codes, I can honestly say that processes are smoother than ever before and much of that is owed to smartphone technology. Where I used to print egift cards at home before taking them to the store, I now simply hand my phone to the cashier for payment. Though the way each cashier handles a transaction may vary (some swipe the phone, some key-enter the code, some hold the phone up to a scanner), in all cases, I’ve been able to use electronic cards with as much success as I enjoy when using plastic gift cards. Follow these tips and your experience should be equally positive.

If you have other gift card questions, add a note in the comments below or leave a message for @GCGirlfriend on Twitter.

Happy Gift Carding!

~Gift Card Girlfriend

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