Gift-Giving Payoff Often Overlooked, Study ShowsGift-Giving Payoff Often Overlooked, Study Shows

Online retailers need to get in tune with gift purchasers or risk missing out on online gift sales that could total $36 billion by 2005. Those are the findings of a recent Forrester Research study, which shows 38% of E-retail respondents didn't even track the percentage of online sales that were gift purchases.

And while many sites want to draw more gift purchases, their efforts may be misdirected. Sixty-eight percent say they plan to add more tools such as gift registries and gift-search tools to drive sales, but those features don't carry much weight with gift buyers, Forrester analyst Carrie Johnson says. Consumers surveyed in previous Forrester reports indicated overwhelming that the key to customer satisfaction was on-time delivery, not site features such as wish lists.

Since delivery can make or break the deal, Johnson says E-retailers should be sure shoppers are aware of deadlines. One suggestion: home-page messages that say, "You can still order in time for [insert holiday]." Sites that have a stellar track record for delivery shouldn't be shy about it. Post high delivery ratings from companies such as BizRate.com where shoppers can see them. "Promoting your on-time delivery record on the site will put consumers at ease when they're ordering gifts," Johnson says.

Online retailers have plenty of incentive to better understand gift buyers, since they spend and earn more than online shoppers who don't buy gifts, according to Forrester. Plus, the benefits of gift purchases are twofold for retailers: Satisfied purchasers may become repeat customers, and satisfied gift recipients are more likely to become new customers.

The key to pleasing those on the receiving end is hassle-free returns. E-retailers have improved in this area, Johnson says, pointing out that more companies are allowing returns at brick-and-mortar locations instead of making consumers ship unwanted gifts. Sites are also turning to third-party providers to handle returns and create happier customers. Refunds can often take four to six weeks, Johnson says, but third-party providers such as ReturnBuy.com Inc. can help shrink that to one or two weeks.