How To Use Shopify Gift Cards To Gain New Customers: Step-By-Step Guide

How would you feel if you received Shopify gift cards to your favorite brands? We bet you’d be very happy. Perhaps you’d feel the rush especially if it came as a surprise.

But aside from the feeling of joy these digital gifts give to your customers, gift cards also allow your business to establish customer loyalty. So if you aren’t yet selling gift cards on your Shopify store, think again. Because you might be missing out on a lot of opportunities for your online business.

There’s no need to worry, because this article was made to explain everything that you need to know about this topic. So let’s get started.

Outline

• What Is A Shopify Gift Card?
• Why Should Businesses Sell Gift Cards On Shopify?
• How To Add A Shopify Gift Card Product?
• How To Create Gift Card And Track With Your Shopify Gift Card Codes
• Gift Card Apps On Shopify
• Conclusion

What Is A Shopify Gift Card?

A gift card is a prepaid stored-value money card, usually issued by a retailer or bank, to be used as an alternative to cash for purchases within a particular store or related business.

Image credits: Decathlon

According to Statista, the global gift cards market was valued at approximately 320 billion U.S. dollars in 2017 and was forecast to reach a value of 510 billion U.S. dollars by 2025. First data statistics showed that among millennials, 55% agree they're more likely to visit a store they would have normally skipped, and nearly two-thirds are likely to visit a store more often.

Remember how happy you are going to a computer store with a discount voucher? That’s loyal customer treatment, bundle sales and all the things macro knowledge. In essence, that’s how a gift card works.

As a digital kind of gift card itself, a Shopify gift card is made online and distributed by Shopify store owners to their customers via email as an incentive. A gift card is also a special type of product that customers can buy and use as payment toward future orders.

In the sample image above, you’ll see that Decathlon sells gift cards on their Shopify store and they are available in several denominations from $10 all the way to $200.

Trivia:

Digital cards are becoming a trend nowadays. But there are still those customers who would prefer a physical gift card. According to Blackhawk Network:

“More consumers use physical gift cards than digital ones. Though both have high awareness, they have different uses. Physical gift cards are seen more for the purpose of gifting, while digital gift cards are seen more for self-use. “

Therefore, to cater customers who want physical cards, you can order gift cards in bulk directly from Shopify. You can choose from their 8 design templates and you can also upload your own design for a more branded look.

Check them out here: Premade Gift Cards

Some Statistics About Gift Cards

You might think that gift cards are simply some form of business strategy to entice customers to pay in advance for their future purchases.

While that is also true, you’d be shocked to know that the gift card market actually is a big one.

Take a look at some of the statistics that we found on Allied Market Research:

• The global gift cards market was valued at $835.2 billion dollars in 2022
• It is projected to grow by $4.2 trillion dollars by 2032

Gift cards issued by Shopify merchants are usually closed loop cards. These are cards that can only be used to purchase their (merchant) products in their store.

• Closed loop cards attained the highest share in the gift card market in 2022
• North America (US and Canada) is the largest user of gift cards in the world.

Read more: Best 40+ Shopify Website Examples To Inspire You [PLUS Ways To Find More Stores]

Why Should Businesses Sell Gift Cards On Shopify?

Expenses such as wages, rent, utilities and critical supplies are becoming more and more unaffordable, leaving businesses vulnerable with cash going out and less cash coming. Online stores bear no less burden since customers nowadays tend to make more budget-conscious buying decisions than ever before.

Creating Shopify gift cards is free. This practice allows supportive customers to make a purchase and redeem at a later date, which can help free up cash flow for your business. You can also issue a gift card to a customer for free as a reward or incentive.

Shopify gift cards are sold like products but gift card sales are reported differently. You can use the gift card sales report to help track your gift card sales and to account for gift card purchases.

Thus, a gift card is not simply a gimmick to attract some attention to your brand. It also possesses some benefits to improve your business. Here are some of them:

• Enhance cash flow: According to Capital One Shopping, 47% of American adults have unused gift cards amounting to an estimated value of $23 billion. Thus, should the gift cards to your store go unused, you’d have more money to spend in your business.

• Improve sales: According to Blackhawk Network, 61% of consumers who used gift cards spent more than the value of the card itself. On average, the excess amount spent is $31.75. Thus, you can reasonably expect your customers to spend more on your store if they use a gift card to purchase from you.
• Nurture customer relationships: As mentioned, some merchants use digital gifts as a form of incentive to their new and existing customers. Rightfully so, this strategy is an effective way to nurture customer relationships. According to Blackhawk Network, 65% of consumers agree or strongly agree that getting a reward from a brand/retailer encourages them to purchase more often from the brand/retailer.

How To Add A Shopify Gift Card Product?

You now know that you can use gift cards not just to have a better cash flow, but also to acquire new customers and nurture the existing ones.

With such huge benefits, you might think that gift cards are hard to create, or you’ll need special apps, or that they are only reserved for more expensive Shopify plans.

Well, not really. Gift cards are available to sell on all Shopify subscription plans.

With Shopify, you can create a gift card yourself. Follow the instructions below.

Step 1: After logging in to your Shopify admin.ClickProducts then select Gift Cards.

Here, you’ll find two gift card options:

• Create gift card- create a card that you can send directly to your customer/s via email or direct communication.
• Add gift card product - create a gift card product that you can sell on your online store.

For the purposes of this tutorial, let’s select Add gift card product.

Provide necessary information for your Shopify gift card. To help your customers find your Shopify gift cards, add them to a collection.

You can also add images or graphic design if you want your gift card to be unique.

Scroll down and you can add denominations for your gift card.

Furthermore, you can better sort your gift so you can properly track them later on. You can do that on the settings at the right side of the screen.

When you’re done creating your gift card, click Save gift card product and it will be immediately available on your store.

Now that you have activated the gift card feature, you can easily change the settings by accessing Gift cards > View gift card products.

How To Create Gift Card And Track With Your Shopify Gift Card Codes

When you create a gift card, you generate a Shopify gift card code and email it to a customer without receiving any payment in return. You decide how much the gift card is worth, and the customer who receives it can use its value toward other products in your store.

From your Shopify admin, go to Products > Gift Cards > Create Gift Card

In the Issue gift card dialog, you can adjust these following sections:

• Gift card code: This is the unique identification of your gift card. You can stick to the automatically generated code or you can add your own code.
• Initial value: The value amount of the card that you can redeem later
• Customer: The customer you send the Shopify gift card to. Either name or email is required.
• Expiration date: If you want to set an expiry date for the gift card, then click Never, and uncheck Never expires to select a date
• Notes: (Optional) The note is visible when viewing the gift card in your Shopify admin, but is not visible to the customer.

After adding all the details, you can click Preview email to see how it looks from a customer’s perspective.

Here’s the email preview:

If you’re happy with it, you can click Save.

Upon clicking Save, the Shopify gift card code will be generated.

After that, you now have the option to send the gift card to your selected customer.

Your customers will receive an email as follows. This email contains a unique Shopify gift card code that they can use at checkout to redeem its value.

Quick read: How to Create a Shopify Automatic Discounts For Your Store?

If you want a more visual demo on how to create a Shopify gift card, watch this video by Casual Ecommerce on YouTube:

Gift Card Apps On Shopify

If you think that the built-in Shopify gift card tool is a bit lackluster to your liking, there are a bunch of apps that you can use to create cards that suit your taste and brand identity. Here are three (3) of them:

01. Rise.ai: Gift Cards & Loyalty

Rating: 4.8 stars (1000+ reviews)

Pricing: Free trial available. Starts at $19.99 per month

More than just a simple gift card- making app, Rise.ai is a loyalty app that lets you reward your customers with cashbacks, as well as track those rewards using their store credit management system. This app works on both online stores and POS for physical stores.

Key features:

• Gift Cards: Gift cards can be sent, scheduled, and reminded of to customers.
• Workflows: Trigger and create store credit rewards based on customer actions.
• Returns and Refunds: Issue gift card refunds and offer store credit for returns.
• Loyalty: Launch a proactive loyalty program, ensuring store credit accumulation.
• Bulk Gift Cards: Corporate gifts, employee recognition, or migration purposes.

02. GiftKart: Gift Card & CashBack

Rating: 5.0 stars (100+ reviews)

Pricing: Free trial available. Starts at $39 per month

GiftKart is an all-in-one gift card suite that allows you to create branded cards (in small quantities or in bulk) so you can run those customer loyalty campaigns with relative ease. One unique feature of this app is that video messages can be embedded to their cards for that touch of personalization.

Key features:

• Acquire new customers with a personalized & branded digital gift card experience
• Win back high-value customers with automated gift card campaigns
• Increase average order value by offering free gift cards on high-value orders
• Manage working capital by issuing store credits instead of refunds for returns
• Flexible design, multilingual support, best-in-class customer service

03. Gift Card Pro: Gift Card Suite

Rating: 5.0 stars (80+ reviews)

Pricing: Free trial available. Starts at $9.99 per month

Gift Card Pro is the app for you if you want to enable your customers to customize their gift card purchases right before checkout. They can include text or video messages, and your customers can also specify a time and date as to when they want their gift cards to be sent to their recipients via text message or email.

Key features:

• Customers can schedule to send Gift Cards via Email or Text Message.
• 50 Beautiful Gift Card Designs Included. Or Upload Your Own!
• Pre-set / Custom Gift Card values. Add specific Gift Card values to choose from.
• Personalized Gift Cards With Gift Messages Or Recorded Video Messages!
• Bulk Ordering. Send To Up To 1,000 Different Email Recipients In One Order.

Conclusion

Once your Shopify gift card products are set up, it's crucial to effectively promote them, especially during festive seasons like holidays. Drawing inspiration from the '10 Amazing Ideas for New Year Marketing Campaigns' article, consider leveraging special discounts, engaging social media giveaways, or even sending personalized New Year emails.

These strategies can significantly enhance the visibility and appeal of your gift cards, tapping into the festive mood and encouraging more customers to purchase and gift them during this celebratory season.

Communication is key. Do let everybody know about your Shopify gift card program, especially your loyal customers so can they support you.