Market growth expected
The popularity of Gift Cards in the US was underlined by a recent National Retail Federation survey which found 60% of 8,899 respondents hoped to receive them this Christmas. Research firm Tower Group predicts the market will be worth $200bn by 2021. The UK Gift Card and Voucher Association estimates people will fork out a total of £4.4bn on the products this year, up from £2.7bn in 2003. Businesses account for about half of this – many using them as rewards, such as for staff performance or long service.
The association’s director-general, Andrew Johnson, says the value of Gift Card sales has grown by about 10% annually over five years, thanks largely to the card format reinvigorating the market.
This festive season promises to be a strong one for Gift Cards if the rest of the world follows the trends predicted below for the USA:
• Over 82% of consumers will purchase a Gift Card
• 86% of consumers will redeem a promotional Gift Card
• 80% of consumers are more likely to shop at a store offering a promotional Gift Card
• 23% of consumers plan to use a mobile/digital Gift Card
• 84% of consumers are more likely to purchase a Gift Card from a merchant who gives them a promotional Gift Card for their purchase