Retailers that do business over the Web, as well as Internet companies without storefronts, can offer gift cards online to their customers.

The retailer sends these “virtual” cards directly to the customer through email, along with a customized greeting from the sender. Instead of offering physical gift cards online that feature a barcode or magnetic strip, retailers assign unique ID numbers to customers that serve as the gift card. Businesses use encrypted email to send these virtual gift cards, ensuring your ID number is safe from theft.

Customers can purchase gift cards online in different denominations, typically ranging from $20 to $500. Some retailers might even allow buyers to select the exact dollar amount the virtual card can be worth. The cards usually don’t expire and can be redeemed at any time.

When people receive gift cards online, they go to the merchant’s website, place the items they want in the shopping cart, and enter the ID number into a form at checkout. The money spent will be deducted from the account if there’s a balance remaining, it can be used for future purchases.

While businesses don’t need to produce a physical card, it’s sometimes a smart business decision. The gift card still represents a unique branding opportunity – it reminds customers to come back to the site for future purchases. In some cases, retailers that have storefronts and online shops will automatically send a card to the recipient’s mailing address if the owner doesn’t activate the virtual card within 30 to 90 days.

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