Gift cards continue to grow in popularity, with huge potential for businesses that understand how to promote and manage strong gift card programs.
Consider the following:
The Benefits of a Well-Run Gift Card Program
Drive sales and revenue: Businesses experience sales uplift from gift cards. Customers spend an average of $23.41 more than the amount loaded to the gift card they receive. Additionally, over 30% of shoppers said they bought an item they did not plan to or bought a more expensive item because of the gift card they received.6
Increase brand loyalty: Gift cards not only bring new customers into stores, but when businesses encourage card reloads through marketing and incentives, they can also increase the frequency of customer visits.
Attract new customers: 38% of consumers say that receiving a gift card prompted them to visit a store that they otherwise would not have visited.7
Get higher margins: Over 30% of gift card receivers say they are more likely to buy a full-price item rather than an item on sale when using a gift card.8
Decrease merchandise returns: According to the National Retail Federation, 15% of holiday gifts will be returned. Because gift card recipients choose their own gifts, gift cards may reduce returned merchandise and the high costs associated with handling returns.9
Increased security and stronger reporting: Gift cards are more secure than gift certificates, and they enable you to use many of the same reporting tools and practices as your credit card program.
Gift Card Market Trends
We all know there are many factors that impact consumer purchases of gift cards. Key insights into recent gift card trends:
12014 First Data Prepaid U.S. Consumer Insights Survey
3Mercator Advisory Services, First Data and Mercator webinar, “Happier Holidays Ahead,” September 2014
4Mercator 2015 Forecast, November 2014
52013 NRF Holiday Returns Survey
6Mercator Advisory Services, First Data and Mercator webinar, “Happier Holidays Ahead,” September 2014
72014 First Data Prepaid U.S. Consumer Insights Survey
92013 NRF Holiday Returns Survey
10Mercator Advisory Services, First Data and Mercator webinar, “Happier Holidays Ahead,” September 2014
11Mercator 2015 Forecast, November 2014