Who Invented Gift Cards? Evolution from the 1900s to Today

Gift cards have become so seamlessly ingrained in our culture that we cannot conceive of a day without gift cards. They are easy to use and gift and are incredibly versatile. You are not alone if you have found yourself wondering who invented gift cards, when and where they came from, and what is their future? 

In this blog, we will discover: 

1. The interesting history of gift cards. 

2. Their digital advanced format. 

3. When were gift cards invented? 

Sounds Intriguing? Let’s get right into it. 

History of Gift Cards 

Gift cards were introduced due to a consumer’s need for a flexible, presentable, and versatile means of gift giving. Still, their history was less of an overnight discovery but more of an evolution process. So, when exactly did gift cards originate and why? 

In the past, gift cards were store credit, or these were written down on certificate types of paper-the gift cards are not close to having any of that ‘polish’ today.

However, from 1990 and beyond, the idea became popular that a card should be presented with a certain dollar value but could then be redeemed both in physical and online stores. 

Now a question arises: who invented gift cards? Let’s talk about the invention of gift cards. 

Who Invented Gift Cards? 

The video rental chain Blockbuster was the first to produce the concept of modern gift cards. In 1994, Blockbuster made the first plastic, pre-loaded gift cards instead of paper-based certificates making it even more convenient.  

The gift cards quickly became popular, and success in the market led other brands to make the same product. Blockbuster’s idea was an innovation that allowed companies a new way to access their customers and retain them. 

Next thing you know, every other retailer joined the fray from big brands like Starbucks, and department stores, such that the introduction of those gift cards marked a definitive moment, especially in retail and service industries, helping create the gift card format as a standard for gift giving. 

First eGift Card: A Chapter in Gift Card History 

The concept of gift cards has really changed since the advent of the internet at the close of the 1990s and beginning of the 2000s.

In 1999, Neiman Marcus came out with one of the earliest versions of an eGift card. In this design, the recipient would be able to receive a code for a gift card by email.  

It was indeed revolutionary since it made gifts possible at the last minute or over a long distance. This new e-gift card’s flexibility and rapidness changed how people shared gifts, even from a distance or if it was time-lag.

The rise of electronic gift cards also led to a shift in consumerism that only grew in the following years. 

Evolution of Gift Cards Over Time 

Gift cards had been more than a practical option for a gift by the late 2000s; they became an integral part of our culture and economy.

Companies recognized the uniqueness of gift cards not merely as products but strong customer engagement tools and loyalty drivers.  

How gift cards have evolved from simple gifts to strategic business assets are described below: 

Building Brand Loyalty and Visibility 

Companies saw gift cards as a chance to bring customers closer. Gift cards became a focal point in business plans in terms of encouraging: 

• Acquisition and Retention: Gift cards gave consumers a reason to return repeatedly to brands. 

• Brand Visibility: Gift cards were small, portable ads; they kept reminding the customer about the brand. 

Seasonal and Themed Cards 

Customized gift cards associated with specific seasonal promotions, holidays, or even unique events, made them so unique for the retailers offering them: 

• The “limited edition” or holiday versions of cards by Starbucks, Apple, and others were big contributors to this trend. 

• These designs made collectors like them, and certain designs of gift cards became priceless, and it helped build brand loyalty. 

Revenue due to Unredeemed Card 

Some gift cards are not utilized; breakage is a term that refers to a situation in which the balance that goes unspent accrues money to companies. This is where: 

• Companies made co-branded gift cards and further increased each brand’s scope and recognition. 

• Major grocery retailers and larger merchants began putting displays of a variety of third-party gift cards near check lanes.  

• Customers were then presented with the ability to make choices from dozens of brands. 

Financial Institutions Stepped in

Banks and other financial institutions realized the potential of gift cards and introduced their own prepaid Visa gift cards and MasterCard products: 

• These cards could be used anywhere a merchant who accepted Visa or MasterCard would accept them, not just at a specific store. Learn to use digital visa gift card for purchases.

• Prepaid gift cards became popular, and financial gift cards became more useful and attractive. 

Corporate Incentives 

Gift cards became popular in corporate incentive programs very quickly: 

• Many employers used it to award employees, and soon the other industries, among many others, caught on. 

• These brought the next big development: electronic gift cards. The digital gift card entered the scene, upgrading the convenience factor for more interactivity and accessibility in gifts-giving and receiving scenarios for consumers and businesses, respectively. 

Transition from Physical to Digital Gift Cards 

The transition from physical to digital gift cards has grown exponentially since early 2010. This happened when the use of smartphones grew because digital wallets and mobile payments made it easier to purchase, store, and redeem cards digitally. 

Google Wallet, Apple Pay, and other digital wallet applications became major contributors to such trends. Now, at the press of a button on an electronic screen, one can buy, send, or redeem digital gift cards. 

This has revolutionized a consumer’s process in addition to making products available more easily and conveniently than ever. It has ushered brand loyalty and scope for a brand to further study behavior patterns of such consumers by opening new lanes of accessing the same data.  

Changes in Design and Features of Gift Cards 

Gift cards slowly transcended to become more than just convenient gifts. Design, features, and even personalization created value in every card to make the gift card an even more thoughtful and personal choice.  

Most retailers also introduced personalized cards and made it possible to pick up designs, upload photos, or add special messages to it. It came with features such as QR codes and security options. Updates ensured easy transactions, fraud protection, and redemption at stores and online were easy. 

The Pandemic Years and Gift Cards 

Pandemic or not, gift cards were one of the hottest commodities during the lockdowns of COVID-19.

People could not step out, so they continued to shop from e-commerce and digital gift cards; they celebrated birthdays, holidays, and other special days safely and from a distance.  

Here is how gift cards adapted to modern times and why they happened to be the need in the pandemic years. 

Gift Cards: A Lifeline for Small Businesses 

1. Gift cards became a lifeline for many small businesses. While their physical storefronts were closed, they told customers to buy gift cards to help maintain cash flow. 

2. Many shops and restaurants even offered bonuses on the purchase of gift cards like adding extra value on the card to say thanks for their support. 

3. Gift cards allowed customers to support their favorite local spots and ensured they would return once restrictions were lifted. 

New Uses and Virtual Experiences 

 The pandemic inspired new uses for gift cards: 

1. Virtual experiences, such as online cooking classes, virtual concerts, and workout subscriptions, became popular gift card options. 

2. Digital gift cards went beyond traditional stores and restaurants, supporting subscriptions to streaming services, wellness classes, and food delivery credits. 

3. This flexibility and versatility came to prove just how such a gift card could easily be transformed into the ultimate gift for people who wanted something meaningful to give to one another in tough times. 

A Surge in Digital Wallets and Online Convenience 

As online shopping surged, digital wallets and electronic payment systems, like Apple Pay and Google Wallet, also rose in popularity. Here’s how digital gift cards helped: 

• People could save and use gift cards directly from their phones, making it easier to redeem. 

• Digital wallets meant access to gift cards on a whim, and people fitted them into the habit of contactless, digital-first shopping. 

• That is where the permanent shift happened: how we regard and use gift cards permanently shifted with the advent of digital. 

The pandemic made digital gift cards, what was once a convenient option, an absolute necessity for celebrating, supporting businesses, and connecting with others. Gift cards were perfectly suited to a socially distanced, digital world and laid the groundwork for even more innovation in the future. 

Future of Gift Cards 

Gift cards will also be much more intelligent in the future. Ideas like gift cards based on cryptocurrencies, shopping experiences through virtual reality, and personalized digital offers are already being shaped.

Additionally, gift cards will suffer from the rising trends of AI and data analytics by retailers to give customers promotion offers and recommend suitable gift cards. 

Improvement in security, reduction in gift card scams, and allowing gift cards to be transferred on multiple platforms through blockchain technology is another revolution within the gift card industry.

This implies that the needs and expectations of consumers will continuously change, and we will adopt new technology, hence changing gift cards altogether. 

Wrapping It Up 

To sum up, gift cards evolved from their discovery to date and continue to evolve to fit into our fast-paced modernization world.

Whether you’re shopping for an item to be gifted or indulging in something special for yourself, gift cards offer flexibility and security with a rich history of innovation.  

Today, websites like Send Credit make the purchasing and redeeming of gift cards faster and safer than ever before.

Gift cards will be an integral part of our lives in the future. They will connect the past, present, and future of gifting.