The Rise of Online Gifting: How Ecommerce Brands Can Unwrap This Growing Sales Channel in 2025

Remember the days when buying a gift meant trudging through crowded stores, wrestling with wrapping paper, and hoping your carefully selected present would hit the mark?

As online shopping steadily continues its commerce takeover, the way we buy gifts is looking a little less like the days of yore and a little more like scrolling a smartphone from the serenity of a sofa.

The truth is that the world of gifting has undergone a digital revolution, and that ecommerce brands not paying attention are missing out on a massive opportunity.

See the change that online gifting has undergone, what modern consumers expect from their favorite brands, and how ecommerce stores can update their own gifting experiences to leverage this surging sales channel.

The Pandemic Pivot: How Online Gifting Exploded

When the world went into lockdown in 2020, something remarkable happened. As physical connections became challenging, people found creative ways to show they cared by leveraging the digital world.

Suddenly, families and friends were spending more moments and milestones apart, and Corporate America transitioned from a sea of cubicles to a screen full of Zoom windows. Without the usual in-person touchpoints, celebrations, and conferences — and access to brick-and-mortar malls to mosey around on foot — more people turned to ecommerce shopping to scratch their gifting itch.

Each passing year, people have been checking off more from their shopping lists online. Clothes, electronics, and even groceries are readily available to purchase from the internet, so why would gifting be any different?

From 2019 to 2020, year-over-year Google searches for "online gift" skyrocketed by 80%. This reflected a fundamental shift in how we approach gift-giving. Instead of enduring on-foot gift-shopping, consumers embraced the ease and convenience of online gifting.

Despite this abrupt shift in how and where people shopped in 2020, holiday retail sales continued to grow, defying economic uncertainties every year since. Even when it was forewarned that “2023 holiday spending could be a disappointment for retailers,” the season still smashed records. Holiday retail sales grew 3.8% over 2022, which was nearly double what had been predicted, to $964.4 billion.

Sales throughout gifting-heavy Q4 continue to crush expectations, pushing the global ecommerce market toward a staggering $8 trillion by 2027.

But this isn't just a pandemic-induced blip. It's a fundamental transformation in consumer behavior. As in-person retail paused, more people than ever got a taste of online retail and haven’t looked back since.

Growing Pains of Online Gifting

In 2020, hordes of shoppers flooded their favorite brands’ websites to buy gifts, but the vast majority of those brands weren’t prepared. Not only were there notable issues like shipping slowdowns and inventory struggles, but the typical ecommerce customer experience wasn’t set up with gifting in mind, causing headaches all around.

Historically, online gifting has been a painful experience. Imagine trying to send a gift to multiple people and running head-first into these challenges:

• Hunting down accurate recipient addresses (and potentially spoiling gifting surprises).
• Going through the checkout again and again, once for every person on the gift list.
• Limited, if any, personalization or customization options.
• No ability to buy the gift and schedule it to send on a later date.
• No flexibility in how the gift is sent, e.g., via the mail, email, text, or shareable link.
• Complicated shipping logistics and spotty tracking updates.

For the digital-first crowd used to eerily personalized experiences, one-click checkouts, and automated post-purchase communications, the friction they faced when trying to purchase gifts was agonizing. It was like going back to dial-up after getting used to fiber internet.

But consumers weren’t the only ones feeling the abrupt growing pains of online gifting. Brands were also struggling to keep up with gifting requests, often taking weeks to process multi-recipient gift orders or orders with any type of customization.

Ready or not, online gifting saw rampant adoption, and it was clear that this new consumer behavior wasn’t going anywhere fast. Instead of waiting out this newfound need for an easier way to buy gifts online, brands had to consider that their shopping experience needed an online gifting overhaul.

Demographics Driving The Change: Millennials and Gen Z

If you're wondering who's powering this online gifting revolution, look no further than millennials and Gen Z. These digital-native generations are reshaping how we think about how, why, and where we buy gifts.

Firstly, consider how a brand is discovered. Before the internet crept into most homes across the U.S., people discovered brands by seeing them crop up in their favorite brick-and-mortar stores or through an ad playing on the radio or printed in their daily newspaper.

While those classic modes of discovery aren’t extinct, it’s a fact that more digital-first shoppers are relying on tech to find their new favorites. Today, millennials find products online more often than discovering them in-store — social media, Google search, YouTube ads, and word of mouth are their leading channels for discovery.‍

Next, once a product has been found and purchase intent is inevitable, let’s think about how modern shoppers are buying products:

• 73% of millennials prefer shopping on mobile devices.
• 68% of Gen Z shop on their phones up to four times per week, spending more per capita than any other generation at the same age.
• Both Gen Z and millennials are least likely to shop in-store as their primary behavior. They’re most likely to shop online first or adopt a hybrid method, like BOPIS (buy online, pick up in store).

The point is that these generations are about to be the vast majority of consumers, and they’re partial to digital experiences. While most ecommerce brands have spent a great deal of time and money perfecting their purchase flow, product photography, post-purchase emails, and more, there’s another shopping experience that needs their attention stat — online gifting.

5 Key Tactics for Ecommerce Brands Tapping the Online Gift Opportunity

Much like online brands that didn’t adapt to changing consumer trends and meet needs through optimized online experiences, easy checkout flows, and transparent email communications, brands that don’t meet the growing demand for an easy way to buy online gifts are going to lose swaths of customers to brands that do.

As mentioned, gifting is an industry that’s going to crest $8 trillion globally in a few short years. Corporate gifting alone is a $306 billion market in the U.S. With more and more of the people buying gifts landing squarely in the Gen Z or millennials bucket, creating an intuitive digital-first gifting experience is key to converting these shoppers.

1. Streamline the Gifting Experience

The future of online gifting isn't about adding features. It's about removing friction and turning gifting into a shopping experience as streamlined as shopping for yourself. Brands need to create gifting journeys that are:

• Optimized for mobile shopping.
• Capable of having multiple recipients in a single checkout.
• Flexible in terms of factors like customization and delivery method.
• Transparent in tracking throughout the post-purchase flow.

2. Leverage Convenience

Fifty-nine percent of millennials are loyal to brands that offer convenient shopping experiences. This means examining what buying a gift online entails and ensuring that every part is smoothed out and simplified, like:

• Picking out products from an easy-to-shop gift catalog.
• Adding personalized gift notes to orders.
• Selecting when to send gifts — instantly or scheduled to send later.
• Choosing between digital or physical gift delivery.
• Accounting for every type of gifting need, such as sending gifts to one or many people, or wanting a self-service versus concierge experience.

3. Embrace Social Commerce

Influencer marketing and user-generated content are goldmines for gift-related marketing. Getting your products onto “Best Gifts” lists are great, but getting people to share how easy it is to send your goods as gifts could be a game-changer for drawing in new customers:

• 19% of millennials make purchases based on influencer recommendations.
• The global influencer market is expected to hit $22 billion by 2025.
• Social media platforms are increasingly becoming shopping destinations.

4. Understand the Emotional Motivations

Gifting isn't just about the product — it's about connection. Google Consumer Insights suggests marketers need to look beyond traditional gifting dates and understand the emotional drivers behind gift-giving.

Outside of the big Q4 holidays like Christmas, Hanukkah, and New Year festivities, the pandemic helped create a habit of more year-round gifting. Throughout the rest of the year, things like employee appreciation and general moments of connection are happening, making the need for giftable brands more apparent than ever.

5. Ensure the Gift Experience Is On-brand

Both Gen Z and millennials prefer shopping directly from a brand’s website, not a third-party marketplace. So while there are gifting marketplaces in existence, brands compromise a lot when selling their products through them.

• Brands give up a significant margin for goods sold through marketplaces.
• Products are often placed directly next to competitors, and there’s no option to improve positioning on the page.
• The marketplace’s experience replaces a company’s finely tuned brand and customer experience, leaving the brand vulnerable and less-than-memorable.
• For consumers, the cost to shop on one of these marketplaces is often prohibitive, and they face hefty markups compared with buying directly from a brand’s website.
• Post-purchase communication, transparency, and support depend on the marketplace, but consumers will associate poor experiences with the brands they picked out.

Nailing these tactics is a must for any online brand looking to leverage online gifting, but there’s one major roadblock to doing so — technology.

Adding Gifting Tools to Your Tech Stack

Adding any new tools to your company’s tech stack is a weighty decision. Each new piece of equipment, from your ecommerce platform to your email marketing tool, needs to take into consideration factors like urgency, consumer behavior, and ROI.

It’s true that adding a gifting platform to a tech stack might not be a fit for every single ecommerce brand. If you’re wondering if this is the right step for you given the trajectory of online gifting, the first step is to truly assess how giftable your products are.

Amazing gifts include foods like cakes, chocolates, and wine. Gift boxes, trendy clothes and makeup, and tech are also inherently giftable. On the other side, things like dieting tools or cleaning products are less likely to be gifted.

If your brand falls firmly on the side of giftability, the potential benefits of investing in a gifting tool are significant:

• Increased average order value
• Enhanced customer loyalty
• Expanded brand awareness
• New customer acquisition channels
• Valuable customer insights

Brands that make gifting easy for both their customers and their internal teams are positioning themselves to capture a significant market share. As ecommerce continues to surge, it’s tougher than ever to differentiate and gain a competitive edge. A foolproof way to do both is a streamlined and scalable gifting channel.

Real-world Success Stories With a Real-world Gifting Platform

Innovative brands like Milk Bar, Graza, Levain Bakery, and Brightland olive oil are already pioneering seamless gifting experiences. They understand that in 2024 and beyond, gifting isn't just a transaction — it's an opportunity to create memorable customer experiences and propel themselves to the top of their categories.

These companies are popular for a variety of reasons. They have a deep connection to their customers and pump thoughtfulness into every touchpoint. Their unique and memorable branding, top-notch customer experiences, and stellar products contribute to their popularity.

They realized that their products make for popular gifts, so they sought out a solution that would align their gifting experience with the rest of their optimized customer journeys.

Zest is the only platform that empowers this type of on-brand, on-site experience today. This unified gifting platform integrates directly with nearly every ecommerce backend and opens up brands to an entirely new audience of consumer and corporate gifters.

Brands that are currently in the gifting game face a mountain of obstacles. While most ecommerce experiences have purpose-built apps to make them easy, gifting has been left untouched. This means most brands rely on their own ad hoc systems of spreadsheets, project docs, scrolling through email threads, and manually uploading individual gift orders and addresses — a painfully time-consuming task.

The resources needed to fulfill gift orders often outweighed the benefits, driving most brands to stay away from the opportunity altogether. This pain was the impetus for founders Alex Ingram and Jeremy Feinstein to start Zest, thus creating a first-of-its-kind gifting platform.

With Zest tucked into their tech stacks, trailblazing brands have been able to:

• Seamlessly integrate Zest into their own websites, offering a streamlined and branded corporate gifting experience. Zest works with any ecommerce platform, with the majority of partners currently using Shopify.
• Meet diverse gifting needs as Zest caters to both self-service gifters who desire transparency and control, as well as those who require more hands-on concierge support. The platform offers public and private gifting storefronts to accommodate the everyday shopper and VIP corporate clients who want to shop from a private catalog of gifts.
• Optimize their shopping experience with Zest’s easy-to-shop storefronts, a fast multi-ship bulk address uploader, and flexible gift-delivery options, including direct shipping and e-gifting.
• Automate the tedious manual tasks of processing bulk gift and corporate gift orders, allowing brands to focus on scaling their gifting channels.
• Set up a branded and customized gifting page. Brands can host Zest on their own domain, send customized gifting transactional emails, and provide branded customer account portals for gifters to manage their orders.

As a result, brands that use Zest have experienced significant revenue growth and operational efficiency.

• Milk Bar reduced gift processing time from two weeks to just two days.
• Brightland increased corporate gift revenue by 50%.
• Grove Cookie Company’s Zest-powered storefronts accounted for 20% of total revenue in the first 11 months.

Looking Ahead: The Future of Online Gifting

By 2029, more than 97% of consumers are expected to engage in online shopping. This means the time to optimize your gifting strategy is now for ecommerce brands.

The brands that will win aren't just those with great products. They are also those who make sending those products as gifts an absolute breeze.

Online gifting isn't a trend — it's a core shift in how we connect, celebrate, and show we care. Ecommerce brands that recognize this and adapt will not just survive but thrive in the evolving digital marketplace.

The gift-giving revolution is here. If you’re ready to unwrap this budding sales channel, chat with Zest to wooing more shoppers and start selling more goods as gifts.

 

Author Bio: Liz Lorge is the marketing lead at Zest. She spends her days digging into online gifting, its growing place in modern ecommerce, and how innovative brands are growing this channel with Zest. Liz has been at Zest for 3 years after stints at space-changing SaaS companies Leadpages, Drip, and Route.