What Are Shopify Gift Cards and Why They Matter
Gift cards are one of the highest-margin products a Shopify store can sell — no physical inventory, no production cost, and customers who redeem them typically spend more than the card value. Beyond the direct revenue benefit, gift cards solve a significant problem for gift buyers: the uncertainty of choosing the right product for someone else. “What do I get for someone who loves this brand?” has a clear, friction-free answer when you offer gift cards.
Shopify’s native gift card functionality is available on all paid plans and is more capable than most store owners realize. This guide covers setup, configuration, digital delivery, and gift card marketing strategies.
Step 1: Enable Gift Cards in Shopify
Gift cards must be enabled before you can create them. Go to Products → Gift Cards. If this is your first visit, Shopify shows an “Add gift card product” button. Alternatively, gift cards can be found in your Admin under Products → Gift Cards after the feature is enabled.
Note: Shopify gift cards require a paid plan. If you’re on Shopify Starter, gift card functionality isn’t available.
Step 2: Create Your Gift Card Product
Click Add gift card product. Configure the gift card product:
- Title — “[Store Name] Gift Card” is standard, clear, and searchable
- Denominations — add multiple denomination variants: $25, $50, $100, $200 are common starting points. Add a “Custom Amount” option if your platform supports it, or create additional variants for popular amounts ($150, $500 for luxury brands).
- Product image — design a gift card visual image that reflects your brand. This image appears in the gift card email, in your store, and in customers’ digital wallets. Invest in a professional-looking design — it’s a brand representation.
- Description — explain how gift cards work: “Valid for any purchase on [store URL]. No expiration date. Can be used for multiple purchases. Gift card code sent by email.”
Step 3: Configure Gift Card Settings
Go to Settings → Gift Cards to configure:
- Expiry date — Shopify allows setting expiration dates on gift cards, but this is regulated in many jurisdictions. In the US, federal law (CARD Act) prohibits gift card expiry within 5 years of purchase. In the EU and many other jurisdictions, indefinite validity is required. Leave expiry disabled or set to 5+ years if required by your market’s law.
- Automatic email notification — when a gift card is purchased, Shopify automatically sends the gift card code to the designated recipient via email. Configure this notification template in Settings → Notifications → Gift card created. Customize the email template with your branding and a warm gift message inclusion field.
Step 4: Enable Gift Message and Recipient Email at Checkout
When a customer purchases a gift card, they should be able to:
- Enter the recipient’s email address (so the gift card goes directly to the recipient)
- Add a personal gift message that’s included in the delivery email
- Schedule delivery (for future birthdays or occasions)
Shopify’s default gift card checkout collects the recipient email. For scheduled delivery and custom gift messages, apps like Gift Up!, Govalo, or Rise.ai extend the native gift card functionality with more sophisticated gifting experience features. These apps are especially valuable for stores where gift card gifting is a significant purchase occasion.
Step 5: Set Up Digital Gift Card Delivery
The default Shopify gift card delivery is a simple email from your store’s notification system. For a better gifting experience:
- Customize the gift card email notification template (Settings → Notifications → Gift card created) with your brand visuals, a warm message, and clear redemption instructions
- For premium gifting experience: apps like Govalo or Gifted create beautiful, animated digital gift card delivery experiences with custom video messages, personalized landing pages, and social sharing options
- Ensure the redemption process is clearly explained: where to enter the code, whether it can be combined with discount codes, how to check remaining balance
Step 6: Add Physical Gift Card Options
While digital is standard for online stores, physical gift cards (plastic cards with magnetic stripe or barcode) are relevant for stores with physical retail locations using Shopify POS. For online-only stores with a premium brand positioning, physical gift card mailers (a branded envelope with a printed gift card insert) create a more tangible gifting experience for the gift giver who wants something physical to give.
For physical gift cards: use a service like National Gift Card or GiftPro that integrates with Shopify to print and mail physical gift cards on purchase. These services bridge online gift card sales with physical card fulfillment, typically for a per-card fee plus the card value handling.
Step 7: Promote Gift Cards for Key Shopping Occasions
Gift cards are underutilized by most Shopify stores because they’re created and then left to be discovered organically. Proactive promotion dramatically increases gift card revenue:
- Homepage feature — during gifting seasons (Mother’s Day, Father’s Day, Valentine’s Day, Christmas), feature gift cards prominently on the homepage: “Not sure what to get? Give the gift of choice.”
- Navigation inclusion — add “Gift Cards” to your main navigation, especially in the holiday season. Gift card seekers who don’t see it in navigation assume you don’t offer them.
- Email campaigns — dedicated “Gift Card Season” emails before major gifting holidays: “Give them exactly what they want — send a [Brand] gift card instantly.”
- Post-purchase recommendation — “Buying for someone else next time? Send them a gift card.” as a post-purchase suggestion to customers who might be gift buyers.
Step 8: Track Gift Card Performance
Monitor gift card metrics in Shopify Analytics:
- Gift card sales — revenue from gift card product purchases (this is a liability until redeemed; it becomes revenue when redeemed)
- Redemption rate — what percentage of sold gift cards are actually redeemed? Unredeemed gift cards represent outstanding liability but the cash is in your account.
- Overspend rate — what percentage of gift card redemptions result in orders that exceed the card value? High overspend rates (customers spending more than the card amount) indicate that gift cards drive incremental revenue beyond the card value itself.
Industry average: gift card recipients typically spend 20-40% more than the gift card value — it’s one of the clearest demonstrations that gift cards are a revenue-generating product, not just a convenience.
Step 9: Use Gift Cards for Loyalty and Incentive Programs
Beyond external gifting, gift cards serve as internal incentive tools:
- Referral incentives — “Refer a friend and get a $25 gift card when they make their first purchase.” Gift cards work well as referral rewards because they’re your own currency, keeping the incentive within your ecosystem.
- Contest and giveaway prizes — gift cards are clean, deliverable giveaway prizes for social media contests.
- Loyalty redemption currency — loyalty program points redeemable for store gift cards rather than percentage discounts; gift cards have less negative impact on brand pricing than percentage discounts.
- Customer service resolution — gift cards as goodwill compensation for poor experiences (damaged product, shipping error) are flexible and fast to issue while keeping revenue within your store.
Frequently Asked Questions
Do Shopify gift cards expire?
By Shopify’s default, you can configure expiration dates on gift cards — but whether you should depends on your jurisdiction’s regulations. In the US, the CARD Act prohibits gift card expiration within 5 years of issue date. Many states have additional restrictions. In the EU, indefinite validity is generally required. Check your local regulations before setting any expiration date. Most stores benefit from no-expiration gift cards — the simplicity and goodwill value outweigh any liability management advantage of expiration.
Can gift cards be used with discount codes on Shopify?
Yes — by default, Shopify allows gift cards and discount codes to be used in the same order. If you want to prevent combining (e.g., prevent using a referral discount code on a gift card purchase), you can configure this in your discount code settings (set the discount to “not combinable with gift cards”). For most stores, allowing combination is the more customer-friendly default.
How do I handle gift card accounting on Shopify?
Gift card purchases are liabilities, not revenue — you receive cash but owe a product or service of equal value. In your accounting: record the purchase as a deferred revenue/gift card liability. When the gift card is redeemed, convert the liability to revenue. Shopify’s financial reports track outstanding gift card balance. Export this regularly for accurate liability tracking on your balance sheet. Consult your accountant for the specific accounting treatment appropriate for your jurisdiction and business type.
Can I issue gift cards for free (as compensation or incentives) on Shopify?
Yes — Shopify allows you to issue gift cards with any balance from your Admin, at no cost, for any reason. Go to Products → Gift Cards → Issue gift card. Enter the recipient email, balance amount, and optional note. The recipient receives the gift card code via email. Use this for: customer service compensation, influencer gifts, staff incentives, and contest prizes.
What apps extend Shopify’s native gift card functionality?
Rise.ai adds advanced gift card scheduling, video messages, and gift card resale. Govalo creates premium digital gifting experiences with custom animations and personalized landing pages. Gift Up! adds physical gift card options and eGift card scheduling. These apps are worth considering for stores where gift cards are a significant revenue channel or where the premium brand experience of the gift card delivery matters for brand positioning.
Final Thoughts
Shopify gift cards are a low-complexity, high-margin revenue stream that most stores underutilize. Setting up a well-designed gift card product, actively promoting it during key gifting occasions, and using gift cards strategically for loyalty and incentives creates incremental revenue at effectively zero additional cost. The customer who gives a gift card introduces your brand to a new recipient — gift cards are one of the most efficient word-of-mouth acquisition tools in e-commerce.
For more on Shopify revenue strategies, explore our guides on bundle strategies, abandoned cart recovery, and email marketing for gifting seasons.
