The England striker was in attendance as the Reds beat Sunderland 3-0 at Anfield on Wednesday evening, and the Liverpool skipper is looking forward to linking up with the 23-year-old.
"Daniel has the quality,” Gerrard told Sky Sports. “I know he's got it - I've seen it.
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"He has said he wants to play football for a big club, the stage is set for him.
“He's at an age now where he should be performing week in week out. There will be no excuses for him. He will be playing with good players at a great club.
"It's all there for him. He just has to go and grasp it with both hands.
"I think he's at the age now when he needs to settle down, get a settled club and show consistently what qualities he's got.
"Daniel's arrival will help the club. He's got power, pace, strength - he has got huge potential.
"He's another attacking option and if you look at the bigger picture from the beginning of the season up until now, we have been a little bit short in the final third."