In today’s digital first world, it feels like everything has moved online. From e-wallets to mobile coupons, there is no shortage of digital alternatives to traditional tools. And yet, when it comes to gift cards and loyalty programs, physical cards continue to outperform their electronic counterparts. The question is simple: if e-cards are so convenient, why are businesses still investing heavily in plastic and paper cards? The answer lies in psychology, marketing, and measurable return on investment.

The Power of Something You Can Hold

Gift giving is more than a transaction. It is an experience. When you hand someone a gift card, there is weight and presence behind it. It feels like a real gift. An e-card, on the other hand, often lands in an inbox alongside promotions, receipts, and spam. The tangible nature of a physical card makes it memorable, meaningful, and harder to ignore.

Research backs this up. A 2024 InComm survey found that 68 percent of consumers prefer receiving a physical gift card over a digital version because it feels more thoughtful and personal. This preference makes a difference when brands are trying to create lasting impressions.

Miniature Billboards in Every Wallet

From a branding perspective, physical gift and loyalty cards offer something e-cards simply cannot provide: visibility. A gift card is not just a payment tool. It is a miniature billboard that customers carry with them. Every glance at the logo, design, or message keeps your business top of mind.

This exposure adds long term value. Unlike an e-card that disappears after redemption or gets lost in a digital shuffle, a physical card often lingers, reminding the recipient and sometimes those around them of your brand.

According to First Data’s Prepaid Consumer Insights Study, 72 percent of gift card users spend more than the original value of their card when redeeming it. That means the branding presence of the card not only reinforces awareness but also translates into more dollars spent per visit.

Trust, Redemption, and ROI

Consumers trust what they can see and hold. Studies have shown that physical gift cards have higher perceived value than e-cards. That perception translates into action.

Physical cards are also redeemed at higher rates. A Paytronix report noted that physical loyalty cards see redemption rates 15 to 20 percent higher than digital-only programs. This is critical because redemption is what drives repeat visits and incremental sales.

And when customers redeem, they usually spend more. National Retail Federation data shows that the average consumer spends $59 more than the face value of their gift card. That uplift is a direct ROI advantage for businesses who use physical cards.

Flexibility That Drives Loyalty

Loyalty cards also open the door to data driven customer engagement. When tied into a CRM or point of sale system, physical loyalty cards provide powerful insights into shopping habits. Businesses can track spending, reward repeat visits, and trigger targeted promotions.

The flexibility extends further. Many programs now combine the best of both worlds by issuing a physical card that can also be registered digitally. This way, customers who prefer mobile can load it into an app or wallet, while others keep the physical version handy. The key is offering flexibility that ensures no customer is left out of the program.

The Bottom Line

E-cards have their place. They are convenient for last minute gifting or purely digital businesses. But if your goal is to maximize brand presence, loyalty, and sales, physical gift and loyalty cards deliver more consistent results. They create memorable gifting moments, act as mobile branding tools, and drive higher redemption rates that feed directly into your bottom line.

For businesses, the smartest move is often a hybrid approach offering both e-cards and physical cards while always keeping the physical option as the anchor.

At CARDSource, we have seen firsthand how powerful these programs can be when done right. With fast turnaround, flexible customization, and proven expertise, we help brands transform simple cards into powerful tools for growth.

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