With less than handful of days before Christmas, and with free ground shipping deadlines passed, retailers are promoting gift cards as the last-minute holiday gift.

“Gift card sales are an important focus for us in December,” says Drew Green, CEO at men’s custom suit merchant Indochino. “We sell an experience—you can’t just pick up an Indochino suit from the store, wrap it up and put it under the tree. This makes Indochino a special gift for someone who is perhaps getting married, starting a new job, or just loves to dress well.”

Typically, about 40%, of Indochino’s annual gift cards are in November and December, Green says. Indochino is No. 399 in the 2021 Digital Commerce 360 Top 1000.

Overall for retailers, gift card sales are higher this holiday season than last year, says Saumil Mehta, head of customer solutions at payments technology vendor Square Inc. Gift card sales have increased 114% from November through mid-December, compared with this same time period last year, according to Square’s data which is based on both physical and e-gift card sales from 10s of thousands of U.S. retailers.

“This holiday season is shaping up to be the biggest year of the gift card yet,” Mehta says. “With inventory tied up due to supply chain issues, consumers are more likely to turn to gift cards than ever before to secure gifts on time. As out-of-stock notifications become more common and items become harder to find, gift cards sales will continue to rise.”

Jay Klauminzer, CEO of gift card marketplace Raise, agrees, and says gift card sales in November were stronger than in previous years because of more consumers shopping early and wanting to get all of their shopping done. Overall, gift cards sales have increased 25-30% year over year, Klauminzer says.

Similarly, Indochino says entering into the holiday season, its year-to-date gift card sales were already higher than all of 2020’s gift card sales. Its goal is to have its 2021 gift card sales on par with 2019, which was “an amazing year for gift card sales,” Green says without revealing more.

“Interestingly, we’re seeing that people are being more generous in 2021, with the value added to gift cards, increasing from $220 on average to $250,” he adds.

Overall, during the holiday season, 34% of consumers said they planned to buy a physical gift card and 20% said they planned to purchase a digital gift card, according to a pre-holiday survey of 938 online holiday buyers conducted by Digital Commerce 360/Bizrate Insights in September 2021.

How merchants promote gift cards

Within Digital Commerce 360’s Top 100 online retailers, 58 of them mentioned gift cards on their homepages on Dec. 15, according to a check by Digital Commerce 360 editors. Of these merchants, 37 prominently featured the product on the homepage, such as its own feature product tile, in a rotating produce image or as a navigation option. (The remaining 21 merchants that mentioned gift cards on their homepage either had it buried at the bottom of the page or within a navigation menu.)

Mass merchant Walmart Inc. (No. 2 in the Top 1000), for example, promoted buying gift cards as a top image on its homepage on Dec. 15.

Walmart.com promotes gift cards at the top of its homepage on Dec. 15.

Apparel retail chain Macy’s Inc. (No. 13) also promoted its digital gift cards both at the top of its homepage and within its homepage, encouraging shoppers to give a gift with one click and e-gift cards will provide instant “merry-ment.”

Macys.com’s promotes digital gift cards at the top of its homepage.

Within emails, some merchants have promoted gift cards for a while. For example, on Dec. 1, Gap Inc. (No. 19) sent an email to shoppers promoting gift cards because “They always fit.” Plus, it promoted its e-gift cards for last-minute shoppers. Victoria’s Secret (owned by L Brands Inc., No. 27) also used the same message—gift cards always fit—in an email on Dec. 15.

Victoria’s Secret (top) and Gap send emails in December promoting gift cards because “They always fit.”

Some retailers, such as apparel merchant Lands’ End (No. 68), leave the urgency and marketing language behind and encourage shoppers to purchase gift cards with an incentive. In an email, Lands’ End promoted that in-store shoppers who purchase a $50 gift card between Dec. 16-22 would receive a $10 bonus gift card.

Land’s End sends an email about its gift card bonus on Dec. 20.

In an email check conducted by Digital Commerce 360 editors, 13 of the Top 50 online retailers promoted gift cards between Dec. 1-15 via email. Only three of the top 50 retailers in the Next 1000 (online retailers ranked 1,001-1,050) promoted gift cards Dec. 1-15 via email.

For this final stretch before Christmas, retailers should be promoting digital gift cards to cater to last-minute shoppers, says Square’s Mehta says. Raise’s Klauminzer says Dec. 22-24 is when the final gift card sales spike typically occurs.

“Last-minute shoppers who can’t find those tricky items will be drawn to gift cards instead of risking delayed present arrivals,” Mehta says.