How Gift Cards Increase Average Order Value
While traffic and conversion rates often dominate conversations, there’s another metric that quietly shapes profitability: Average Order Value (AOV).
Increasing average order value means that every transaction contributes more revenue, which can dramatically improve margins without requiring additional marketing spend.
Among the many strategies available, gift cards stand out as a surprisingly powerful tool. They not only delight customers but also create opportunities for merchants to maximize sales.
This article explores why AOV matters, how gift cards influence it, and why tools like GV can help merchants unlock the full potential of digital gifting.
Why is AOV Important to an Online Store?
Average Order Value is more than just a number on a dashboard; it’s a reflection of customer behavior and purchasing patterns. When shoppers consistently spend more per transaction, businesses enjoy several advantages:
-
Improved profitability without extra marketing costs: Acquiring new customers is expensive. By increasing AOV, merchants generate more revenue from existing traffic, reducing reliance on costly acquisition campaigns.
-
Better cash flow: Larger orders mean more immediate revenue, which strengthens liquidity and allows businesses to reinvest in growth.
-
Enhanced customer lifetime value (CLV): Customers who spend more per order often become more engaged, leading to repeat purchases and stronger loyalty.
-
Operational efficiency: Fewer small orders reduce fulfillment costs, packaging expenses, and shipping complexities.
In short, AOV acts as a lever for sustainable growth. Rather than chasing endless new visitors, online stores can focus on maximizing the value of each transaction.
How Gift Cards Increase Average Order Value
Gift cards bridge the gap between convenience and personalization. For customers, they offer flexibility, recipients can choose exactly what they want.
For merchants, they represent prepaid revenue and a chance to influence future purchases. When implemented strategically, gift cards become more than just a gifting option; they transform into engines that increase average order value. This is how gift card increase AOV
Encouraging customers to spend beyond the card value
Shoppers redeeming gift cards often treat them as discounts rather than strict budgets. If someone receives a $50 card, they may happily spend $70 or $80 to get the product they truly want. This “top-up” behavior consistently raises AOV.
Driving premium product purchases
Gift cards reduce the psychological barrier of price. A recipient with a $100 card is more likely to choose a premium item they wouldn’t normally buy with their own money. This nudges customers toward higher-value products, boosting overall sales.
Creating urgency and repeat visits
Digital gift cards often come with expiration dates or promotional tie-ins. This motivates customers to shop sooner rather than later, increasing transaction frequency and order size.
Simplifying refunds and exchanges
When refunds are issued as store credit via gift cards, customers are encouraged to spend again. Instead of losing revenue, merchants retain it and often see customers spending more than the refunded amount.
Strengthening loyalty programs
Gift cards can be integrated into rewards systems, incentivizing actions like referrals, reviews, or repeat purchases. This not only keeps customers engaged but also increases the likelihood of larger transactions.
Seasonal and special occasion boosts
During holidays, birthdays, or events like Black Friday Cyber Monday (BFCM), gift cards become popular presents. They bring in new customers who often spend more than the card’s value, raising AOV during peak shopping periods.
>> Don't miss:
10 Gift Card Marketing Ideas For Black Friday, Christmas & New Year
GV: A Dedicated Tool to Boost AOV and Sales
While gift cards are powerful on their own, merchants need the right platform to maximize their impact. GV offers a comprehensive solution designed to help online stores turn gift cards into growth engines.
GV enables merchants to create branded gift cards with custom visuals and messages, or choose from pre-built templates for quick setup.
Customers can add personalized video messages, making the gifting experience memorable and unique. E-gift cards can be scheduled for delivery on special occasions like birthdays or holidays, ensuring timely engagement.
Refunds and exchanges become seamless with GV’s store credit feature, eliminating fees and keeping revenue within the business. Loyalty programs are enhanced by rewarding customers with gift cards for purchases, reviews, or referrals, encouraging repeat engagement. Merchants can also build trust by sending gift card emails directly from their brand domain, reinforcing credibility.
In essence, GV transforms gift cards from a simple product into a strategic tool that helps merchants increase average order value, retain customers, and drive long-term sales growth.
Final Thoughts
Gift cards are more than just convenient presents; they are strategic assets for online stores. By encouraging customers to spend beyond the card’s value, nudging them toward premium products, and integrating seamlessly with loyalty programs, gift cards consistently raise AOV.
For merchants, the benefits extend beyond immediate revenue. Gift cards foster stronger customer relationships, simplify refunds, and create memorable experiences that keep shoppers coming back. With tools like GV, businesses can fully harness these advantages, turning gift cards into a cornerstone of their growth strategy.
Increasing average order value doesn’t always require complex tactics. Sometimes, the simplest solutions, like gift cards deliver the most powerful results.
FAQ
Do gift cards really help increase average order value?
Yes. Customers often spend more than the value of their gift card, treating it as a discount rather than a limit. This behavior consistently raises transaction sizes and boosts AOV.
How can merchants use gift cards to retain customers?
Gift cards can be integrated into loyalty programs, used for refunds, or offered as rewards for referrals and reviews. These strategies keep customers engaged and encourage repeat purchases.
Why should merchants consider GV for managing gift cards?
GV provides a fully customizable platform that allows merchants to design branded gift cards, add personalized video messages, schedule deliveries, and issue store credit seamlessly. By combining convenience with personalization, GV helps merchants increase average order value while building trust and loyalty.
