A Generational Snapshot of Digital Communication and Gifting:
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1 A Generational Snapshot of Digital Communication and Gifting: Surprising discoveries about the behavior and emotions of digital communications, gifting and gift cards in America December 2015 Research Presented By: Gift Card Impressions and The Center for Generational Kinetics
2 Author s First Word Gifting is a joyous way of marking the many important occasions in our lives, from birthdays and anniversaries to retirements, graduations and Christmas. But the real impetus behind gifting is the emotional message sent between giver and receiver. It s this underlying message and the emotional connections we re longing to make through gifting that we sought to uncover through this study. We want to understand consumer desire around more meaningful engagement through not just gifting itself but also through digital messaging which is increasingly the method of choice for America. Understanding the digital gifting experience both what the current reality is and what is possible through enhanced personalization is critical for consumers and companies alike. The emotional connections that can be formed through personalization are a remarkable turning point in the history and legacy of gift cards and how we connect in today s digital world. -Brett Glass, Gift Card Impressions and Jason Dorsey, The Center for Generational Kinetics 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 2
3 Table of Contents 04 Welcome from the Authors 05 Key Findings from the Study Bridging the Emotional Divide: The Advantage of Enhanced Digital Solutions Happier Them, Happier Us: The Business Case for Digital Gift Cards One Man s Treasure A Look at Gifting 18 About the Study s Authors 19 Research Methodology 20 Copyright and Usage 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 3
4 Welcome From The Authors December 2015 Hello, and welcome to our 2015 study on digital communications, gifting and gift cards! We are excited to share our surprising findings with you. This national study was designed to gauge consumer desire around more meaningful engagement and gifting through enhanced digital messaging and gift cards. This consumer desire, analyzed by generation and gender, was designed with the goal of applying insights from the study to deliver stronger emotional response for gift card givers, receivers and anyone connecting in a digital way. Digital communication is integral on both a personal and a business level as consumers strive to effectively send meaningful messages to one another. Digital communication is also important for reward and recognition as companies strive to drive loyalty and engagement with their consumers. Specifically, we wanted to understand gifting in light of digital gift cards and what might make this more meaningful and able to foster deeper personal connection. Gift Card Impressions and The Center for Generational Kinetics are pleased to partner on this groundbreaking national gifting research and even more excited to reveal to you what our national study found. To schedule a media interview about the study and its findings, please contact Brett Glass, CEO at Gift Card Impressions. Best regards, Brett Glass President, CEO Gift Card Impressions brett@giftcardimpressions.com Jason Dorsey Millennials Expert Center for Generational Kinetics info@genhq.com 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 4
5 Bridging an Emotional Divide: The Advantage of Enhanced Digital Solutions 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 5
6 Digital Communication Often Doesn t Foster Emotional Connection Technology is frequently labeled a double-edged sword, both uniting and dividing us. We ve each experienced this is our own lives in different instances, from strangers to friends and loved ones. Digital communication is no different because, while it allows us to interact over distances and in ways that previous generations couldn t even imagine, there is still no replacement for face-to-face interaction. In fact, our study found that this feeling is nearly unanimous. A full 91% of us feel that, when it comes to personal and meaningful conversation during a special occasion, there s no topping a face-to-face interaction. This is especially true for women and Baby Boomers. But since face-to-face interaction isn t always possible and is becoming increasingly difficult, as we all are busier in our day-to-day lives, we turn to digital communication as the practical answer. The problem, however, is that our typical electronic or digital communications aren t getting it done when it comes to creating emotional connections. You know that. We know that. In fact, our national study revealed that nearly 40% of consumers feel little to no emotion when they receive a happy birthday message through or Facebook. Wow! Little to no emotion at all. This must be solved. We know that people of every age spend a great deal of time and effort communicating digitally and want to have meaningful communication and foster emotional connections digitally. This is critically important and only going to get more important as the digital word becomes a deeper part of our lives. Our national study also found that 66% of consumers wish there were a way to make standard electronic communications like text and more personal and special. This means that two-thirds of all American consumers wanted to add more meaning behind their digital communication, and 71% wish there were a better way to convey their intended emotions when sending heartfelt messages electronically. This is even higher for women, 76% of whom feel this way Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 6
7 Personalization Bridges the Digital Emotional Divide Can anything be done to infuse more meaning into our digital communications? Our study revealed that there is an effective solution for the emotional divide between digital communications and the lack of meaningful connection that often results. The answer: personalized elements such as personal photographs, music or videos have a remarkable, powerful impact on the connection that people feel to the digital messages they receive. This is a strong sentiment, as our study found that nearly 80% of America feels more deeply connected to someone when they receive a message that includes personal photos, music or videos vs. a standard or text. Nearly 80%! Our study revealed that the emotional connection people feel with the sender of an electronic message triples when photos and music are sent instead of the traditional birthday message on Facebook. How strong is the steady tide of connectivity that comes from personalization? Strong enough even to counteract the negative vibe of waiting until the last minute to send a gift or message! In fact, 69% of Americans surveyed say they would feel more positive about someone waiting until the last minute and getting them a gift card if it is delivered with a digital photo book featuring personal photos! 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 7
8 Personalization + Gift Cards Is a Winning Combination The effectiveness of personalization in enhancing connection doesn t stop with general communication. It extends to gifting and particularly to gift cards. This is important to both consumers and the gift card industry as a way to overcome the negative perceptions of gift cards as impersonal or lacking in the creative forethought given to other types of gifts like that handwritten note you scribbled in your car right before you walked into the birthday party. With elements of digital personalization, those days may be behind us. Our study revealed a marked shift in attitude and perception when consumers were shown a gift card alternative with these enhanced digital elements. We found that emotional connection nearly doubles when adding enhanced digital personalization to a gift card! That is a huge increase in impact from your message or gift. How effective is this emotional connection? It s strong enough to shift consumer preference away from traditional plastic gift cards and toward digital gift cards. Our national study revealed that 70% of Americans felt that it would be more meaningful to receive a digital gift card vs. a traditional plastic gift card if the digital gift card came with digital personalization. But it doesn t stop there. These personalized elements are very likely to turn the receiver into a sender. We found that 74% of Americans would, on average, buy four MORE gift cards if they could create a better gifting experience for gift recipients through adding personalization. In fact, 15% of consumers would buy five or more additional gift cards and 7% would buy at least 10 additional gift cards per year! Based on current gift card stats, that is an extra $35 $700 per year per gift card consumer! And that would mean millions of happier people, too Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 8
9 Happier Them, Happier Us: The Business Case for Enhanced Digital Gift Cards 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 9
10 Emotional Connection Leads to More Loyal Customers The emotional connection fostered by digital personalization is not just for consumer to consumer; the connection can occur between businesses and consumers when companies apply the same methods of personalization. Companies commonly send out communications to their customers, often with some type of coupon or special offer. We found that Millennials feel more emotional connection to a company than other generations when they receive a traditional offer or coupon code, but it s still only one-third of them who feel this type of connection. Our study found that positive feelings toward a company increase significantly when a traditional offer is delivered with enhanced digital solutions. In fact, we found that the percentage of those who feel positively about the company almost doubles, even for Baby Boomers, who are much more likely than the other generations to remain emotionally disconnected from companies. But it doesn t stop there. Our national study revealed that enhanced, personalized customer delivery technology also increases the likelihood of consumers actually acting on the offer and spending their money with the company. The likelihood of consumers doing this increased by 57% as a result of the enhanced communication! 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 10
11 Engaging Digital Messaging Is Worth Paying For Without a doubt, people enjoy giving digital gift cards with the addition of personalized photos, music or videos from friends, and they even enjoy more personalized digital elements from company communications. But the real question is whether or not these additions are worth money. It turns out that, for most of us, the better experience for the recipient of enhanced digital gift cards and messages is absolutely worth paying more to create. Our study found that over 70% of all Americans would pay an additional amount averaging $2.63 to create the impact they experienced with the digital gift card and messaging approach. In fact, Baby Boomers were willing to pay the most! 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 11
12 One Man s Treasure A Look at Gifting 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 12
13 Some May Call it Re-Gifting; Others Call it Ridiculous After all, why keep something you don t like and you ll never use, especially when it can be passed along to someone else as a gift? That s undoubtedly the thinking behind the millions of re-gifted gifts that will exchange hands this year. Our study found that Millennials are the most likely of all generations to re-gift and that 33% of them anticipate re-gifting one to two gifts this year. Our study revealed that more than half of us have returned a gift someone gave us for the holidays after telling the person who gave it to us that we liked or loved the gift. Of all generations, Gen Xers are the most likely to return gifts. The message to gift givers of every generation: Be sure to include gift receipts because gift returns occur more than you think, and you might not know your recipient as well as you thought! That s a lot of re-gifting, but there are also a lot of returned gifts! 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 13
14 Your Parents Know You Didn t Like Their Gift When it comes to pretending to like a gift, if you re like most Americans, your poker face may need some work. It turns out that the person who gave you the gift can probably tell whether or not you really like it. And if they can t tell right away, they re likely to get the idea when three years pass and they still haven t seen you wear that sweater. It s happened to all of us. You receive a gift during the holidays and the people giving it to you are so excited. You open it and, voila, you don t like it. But you smile graciously and may even tell them that you love it. They ll never know, right? Wrong. Our study found that 80% of ALL Americans have watched someone open the gift they gave them and realized the recipient didn t like it, even though the person said they loved it Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 14
15 Holidays Gift Giving Is Fun But Not Always Frugal It s no mystery that people spend a lot of time and money during the holiday season and even throughout the year to mark special occasions by giving gifts. It s very apparent that we love to give gifts. How much do we love gift giving? Enough to spend more than we can afford! Our new national study found that over 60% of Americans have bought someone a gift that they actually couldn t afford. Now all those ads about low-interest holiday loans are making a lot more sense Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 15
16 Don t Disappoint When Gift Cards Are What They Really Want! Gift cards sometimes get a bad rap as being less thoughtful or personal than other gifts. But our national study reveals that these might just be the gifts people actually want. We found that gift cards take first place in gift receiving! When given the option between receiving a gift card, a physical gift of the same value, or no preference, regardless of the monetary value, nearly half of consumers chose the gift card. Apparently, people do have a preference, and that preference is gift cards! This is true across all generations. After all, gift cards fit every size and style and they re always in stock and they look so much better than that awkward holiday sweater. This might be an especially good thing for all of us last-minute shoppers. And for those of us not particularly skilled at picking the right gifts, gift cards seem to be a perfect solution for not buying something the recipient has to lie about actually liking. We know this because our study also found that especially bad gifts could end up on social media, most commonly put there by a Millennial who is in disbelief that someone actually gave them that gift. In fact, our national study found that over 30% of Millennials in America say they have taken a picture of a gift received and posted the picture on social media because they couldn t believe someone gave them something so ridiculous Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 16
17 Research Conclusion The national study revealed that, across generations, people are longing for a way to make their digital communications more meaningful and better capable of fostering emotional connection. We found that personalization in the form of personal photographs, videos and music the person loves go a long way toward establishing this connection with a lasting, meaningful impression. This connection translates well to digital gift cards from consumer to consumer and in the business world, where not only emotional connection but also action on the part of the consumer results from personalization. People are much more likely to feel connected to the gift giver when they receive a personalized message or gift card that is digitally enhanced through personalization. The same is true once consumers know these types of gift cards are available: they are much more likely to be inspired to send a similar gift card themselves or act on the offer sent by a company that personalized their messaging through photos, videos and more. The capability to personalize digital gifting makes consumers much more likely to purchase additional gift cards above and beyond what they would normally purchase in the course of a year and to even pay additional money to add the personalized features so the recipient can feel the true emotion behind the gift. We also uncovered some quirky aspects of gifting, from finding that more than half of us have bought gifts we couldn t afford and also received a gift we didn t actually like but said we did, all the way to uncovering that one-third of Millennials are likely to re-gift at least one gift this year! Together, this paints an unexpected, fascinating snapshot of gifting in America by generation and reveals the potential for enhanced digital communication and personalized digital gift cards to become the dominant method for delivering meaning in a world where everyone is busy yet wants to connect. This potential becomes even more apparent both as consumers become more reliant on digital communication and gifting and as older generations follow the trend of younger generations increasingly infusing technology into gifting and every other aspect of their lives Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 17
18 About the Study s Authors Gift Card Impressions GCI was founded on the insight that, while gift cards are one of the most popular gifts, they lack the personalization and warmth of other gift alternatives. There is a stigma surrounding gift cards that they are an impersonal, last-minute gift that takes little effort on part of the giver. GCI introduced physical and digital packaging and personalization solutions that solve the impersonal problem facing both physical and digital gift cards. And that s just the beginning. What started as a way to digitally wrap electronic stored value transactions for the gift card industry has evolved. The GCI Digital Engagement Platform uses personalization and multimedia technologies to elevate digital communication as a robust platform or as a one-off campaign. The Center for Generational Kinetics The Center for Generational Kinetics is the leading expert and research firm on Millennials, generational differences and the generation after Millennials, igen. The Center s team of PhD researchers, strategists and speakers help companies and organizations solve tough generational challenges driven by emerging generational trends and differences. Each year, The Center works with over 150 clients around the world, from car manufacturers and hoteliers to insurance, healthcare and technology. The Center s team is frequently quoted in the media about the effect of generational differences on everything from shopping and parenting to working and retirement. Learn more at Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 18
19 Research Methodology This research study was led by Gift Card Impressions and The Center for Generational Kinetics. The survey was administered to 1,000 U.S. adults age 18 65, with an additional 200 oversample of women. The sample was weighted to the current census data, and participants were screened for U.S. citizenship. The survey was conducted online from November 3, 2015 to November 9, 2015 and has a confidence interval of +/-3.1% Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 19
20 Copyright and Usage This document is copyright 2015 Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. The information in this document can be referenced in the media, in whole or in part, as long as this document is cited as the source for the information. In no way does this document provide an endorsement of any product, service, company or individual. This document is provided as-is. Information and views expressed in this document may change without notice. The strategies and examples depicted herein are provided for illustration purposes only and are not guarantees of specific results. You bear the risk of using this document Gift Card Impressions and The Center for Generational Kinetics, LLC. All rights reserved. Media usage allowed. 20
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