Amazon’s new Facebook-powered Surprise! mobile application points to how mobile gift cards are increasingly a must-have for a comprehensive mcommerce strategy.

The Surprise! app offers e-cards for a variety of occasions, including birthdays and December holidays, and allows consumers to quickly attach an Amazon Gift Card to their mobile device and send it along with their customized message. Mobile gift cards are likely to eclipse physical gift cards in the future and are attracting customers with enhanced personalization features and sheer convenience of purchasing on a smartphone.

“Amazon has the advantage over other virtual gift competitors due to the fact that they are already one of the largest commerce sites,” said Esha Shah, manager of mobile strategy at Fetch, San Francisco. “So not only do they have many consumers payment credentials, but users also trust their payment system to be secure.

“They also have a huge user base, so they will not need to encourage new signups.  Therefore the process will be much smoother for users, than if a new player took a similar approach.”

Backed by mobile payments
Mobile gift cards are set to take off in 2015 on the heels of many brands’ integration with mobile payment platforms such as Apple Pay and Google Wallet. Consumers are becoming increasingly more comfortable with conducting commerce on mobile devices, and the convenience of sending a gift card with the tap of a finger is sure to entice on-the-go customers that lack the time to visit a brick-and-mortar store.

“With the prediction that by 2016, 85 percent of all digital shoppers will be mobile shoppers, retailers that haven’t already prioritized mobile are lagging behind,” said Tyler Roye, CEO and founder of eGifter, New York. “Apple’s recent moves to embrace mobile commerce are sure to continue to accelerate the pace of mobile payment adoption, and as a result, retailers of all sizes will need to make the necessary changes as the POS to handle mobile payments.

“Mobile gift cards are a natural place for retailers to start since they’re an extension of the existing gift card program and a payment type that consumers are already familiar with.  They also provide a reasonably low volume, low risk way to begin training POS employees on smartphone payments before opening the floodgates.”

Dunkin’ Donuts is one of the top brands already leveraging mGift cards. Customers can purchase virtual gift cards directly within the Dunkin’ Mobile App and send to friends or family via Facebook, email or text.

“A parent can send their teenaged daughter a mobile gift card for her favorite store to use when she shops at the mall, and instantly reload it when needed,” Mr. Roye said. “As Dunkin’ Donuts and Starbucks have shown, mobile gift cards can be used successfully in mobile payments that are tied directly to loyalty and rewards.”

“Innovative programs such as these demonstrate even further use cases for the mobile gift card, elevating its importance in a comprehensive mobile commerce strategy,” he said. “The online-to-offline aspect of such strategies also provides valuable data and a connection to the consumers shopping in stores.

“The key takeaway for retailers is that moving into a more digital age, commerce must incorporate tools for frictionless, low-risk mobile transactions, and mobile gift cards can be an important piece of the solution.”

The convenient factor
While brands can use mobile gift cards in conjunction with mobile payment and loyalty platforms, the convenience factor is ultimately the biggest draw for customers. Users of virtual cards do not have to worry about losing or misplacing cards when shopping online or in-store, and can personalize messages sent on mobile.

The Amazon Surprise! app allows users to attach photos, videos and audio along with gift cards.  Its multiple functionalities and features will require other brands to bolster their virtual gift card strategy and offer as many customizable options as possible.

“Mobile gift cards can be bought anytime, from any device,” Mr. Roye said. “They can be stored in a mobile wallet, and redeemed anytime, from any device. What could be more convenient?

“That said, when sending a mobile gift card to a friend or family member as a true gift, customization and personalization are huge factors,” he said. “EGifter’s own research, to be released this month, reveals that nearly half (43 percent) of consumers would take advantage of personalization features for a gift card, like uploading a picture or including a video greeting, if given the option.

“This represents another opportunity for retailers as social and mobile gifting continue to intertwine.”

Final Take
Alex Samuely is an editorial assistant on Mobile Commerce Daily, New York