Digital gift cards may be more practical — but people still want the real thing

MORGANTOWN, W.Va. – Digital gifts are all the rage, especially when it comes to giving people money. Despite many places offering digital gift card options, it turns out most gift givers still try to find a physical card in stores, researchers from West Virginia University explain. In fact, five new studies on the reaction to giving and receiving gifts shows people just feel better when they actually have something to hand to another person.

“These studies looked at the psychology involved in giving and receiving gift cards. Across the board, they showed that givers are less likely to choose digital – as opposed to physical – gift cards than recipients are to prefer to receive them. This asymmetry occurs partly because givers overestimate the extent to which recipients see digital gift cards as violating the social norms of gift-giving,” says Julian Givi, an assistant professor of marketing at the Chambers College of Business and Economics, in a university release.

“For example, in our pilot study, we asked 96 participants whether it’s more socially normative for a giver to give a physical or digital gift card,” Givi explains. “The vast majority of participants – 94.8% – selected the physical gift card.”

The researcher notices that, primarily, people would rather give a physical gift card to avoid having their seem impersonal.

“Givers may worry that digital gift cards won’t be seen as thoughtful. Whereas physical gift cards require a giver to go to a store and purchase the gift card, digital gift cards require only a minimal amount of time and effort, as the giver can quickly obtain one online. And a digital gift card is more likely to imply that the giver waited until the last minute to purchase a gift. This is all inconsistent with what we think about when it comes to gift-giving norms.”

Forget shopping, the gift card industry is booming

There are also interesting differences in the overall impression of the two card choices. Physical gift cards are much more desirable to give, whereas digital ones are more convenient to receive. This may be because digital cards are online at all times, and you don’t have to worry about losing them. Givi’s data backs this idea, showing that once people consider how it might feel to get a digital gift card, they may then be more open to gifting one to someone else.

One study in particular involved participants giving a digital gift card as a birthday gift. During this study, the team made up a time called “National Digital Gifting Month,” which the birthday is theoretically taking place in.

“Givers were more likely to opt for digital gift cards when there was an occasion that altered their perceptions of gifting norms,” Givi reports.

Despite the common anxieties associated with digital gift card giving, the industry is booming. The global market grew by approximately 15 percent between 2015 and 2020, reaching $258 billion. Researchers expect those trends to continue over the next decade, rising to over $1 trillion by 2030.

“Givers worry about violating norms by giving a late gift or giving the same gift twice, while many recipients won’t really mind getting a gift after their birthday or receiving the same basket of goodies two years in a row,” Givi concludes. “Just as in those situations, while there may be a widely accepted social norm prescribing physical gift cards over digital ones, givers pay more attention to this norm than recipients do.”

The findings are published in the journal Psychology and Marketing.

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About the Author

Shyla Cadogan, RD

Shyla Cadogan is a DMV-Based acute care Registered Dietitian. She holds specialized interests in integrative nutrition and communicating nutrition concepts in a nuanced, approachable way.

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