While gift cards continue to gain in popularity as a practical gift-giving alternative, Brandweek reports that in order to attract buyers, more retailers need to provide the option to personalize gift cards, this according to a study being released this week by the National Research Network.

The perception that gift cards are impersonal is the top inhibitor for consumers purchasing gift cards, the study found, with nearly half of respondents citing that as a factor. The August study polled 3,0007 consumers and was conducted online in conjunction with market research company Hartman Group.

"In order to increase sales while also helping gift cards stand out in the dense marketplace, marketers should focus on personalizing the gift cards," said Keith Maladra, VP-consumer intelligence at the National Research Network, Chicago.

Maladra said personalization would require a better understanding of the target markets and what appeals to them. He added, "For instance, gift card providers could customize gift cards for children by placing an image of a 'cool kid' on the card."

Starbucks, Wal-Mart and Visa are among the larger companies that offer personalized gift cards. It's done primarily via the Web, allowing consumers to put messages and pictures on the cards.

In 2006, consumers spent nearly 18 percent of their 2006 total holiday merchandise gift expenditure on gift cards, up from 13 percent in 2005, per the International Council of Shopping Centers.

The National Research Network study also found that half of gift card recipients typically spend more than the gift card amount when redeeming it. Additionally, 15 percent of gift card recipients spend less than the total gift card amount, giving the card issuer a benefit.

While an ailing economy may affect the monetary amount given in gift cards this holiday season, the study noted, over half of consumers said they plan to purchase at least one card. In the past year, respondents claimed to have spent $262 on gift cards, at an average of $52 per card.

"What we see now is that gift cards are still one of the perfect gift-giving solutions, but a third of respondents said they would not spend as much," said Blaine Becker, director of marketing and communications at Hartman Group, Bellevue, Wash.

Becker said marketers could consider adding value to their cards this season, following in the footsteps of retailers that offered an additional 10 percent to 20 percent this summer when consumers were spending their tax stimulus checks.

Among other findings in the study:
- More females (60 percent) than males (44 percent) reported buying cards in the last year;
- The average number of gift cards consumers receive tends to correlate with household income. As household income increases, consumers tend to purchase more gift cards;
- Christmas and birthdays were cited as the top occasions for gift card giving;
- This holiday season, younger consumers are expected to buy gift cards, with 78 percent being between the ages of 18-24;
- Discount stores such as Wal-Mart and Target were the most popular gift card benefactors, with 42 percent of respondents reporting purchasing a discount store card in the past year. Restaurants came in second (26 percent), followed by clothing stores (21 percent).

"The gift card is a no-brainer for almost any company," said Jim Novo, a marketing consultant based in St. Petersburg, Fla. "They take very little space, so the revenue in terms of square footage is tremendous. And they are low maintenance. It's a terrific way to extend the brand."