According to CNNMoney.com, in an article written by Jessica Dickler, about 60% of consumers say that they would like to receive a gift card rather than a traditional present. Year after year, gift cards are consistently the most popular gift to give and receive during the holiday season. As their popularity continues to grow and options and flexibility continue to expand it’s becoming more and more important for business owners of every size and type to take notice of this popular payment trend.
In an article posted by ICSC, CEB TowerGroup, a company which has been tracking gift card sales since 2006, predicts that sales of gift cards could top $130 billion by 2015, up from $110 billion in 2012. Simply put, consumers love to both give and receive gift cards. As a gift recipient, it’s most likely because it saves the hassle of returning the ugly sweatshirt or tacky tie to a department store and waiting in long lines to make an exchange or return. Gift card givers also prefer the ease and speed of check out when purchasing a Gift Card while eliminating the stress of getting “the perfect gift”.
Many companies that offer merchant services and payment processing have gift and loyalty card programs and even a small gift card program can increase profits for any size business. According to Karen Whiteley at Regal Payment Systems, a program consisting of 30 cards with an average activation of $42 per card can give a small business a total net profit of over $800.
The National Retail Federation has conducted a survey to gauge what types of cards consumers will most likely be purchasing and according to their 2012 holiday survey. It breaks down like this:
So as a business owner, it’s important to consider the consumer trend towards gift cards to ensure that you are offering customers the products and payment options that they demand. With the average customer spending 33% more than the amount of the gift card, not offering gift cards as a payment option could mean missing out on higher profits, increased customer loyalty, repeat business and increased sales. Gift cards are a very practical gift and as their popularity and flexibility increase and new rules and regulations surrounding gift cards provide more protection for the consumer; this trend shows no sign of slowing down.
Brandon Cook is Senior Graphic/Web Designer for Regal Payment Systems. When not creating and developing with Regal he enjoys spending time with his kids and listening to music.
Thanks for the great post, Brandon. Offering gift cards for any business is a good idea. Do you have recommendations of vendors that provide gift card services for small businesses? I have small business clients that may be interested in producing gift cards for their customers but wondering the best affordable route that I can point them to. Thanks
Hi Anne,
Thanks for the comment. If your customers are looking to just have gift card printed they can try a company called Plastic Print Solutions (http://www.plasticprintsolutions.com/).
Thanks for your comment
Thank you for the wonderful article, Brandon. You have brought to light some very important points about the increasing popularity of gift cards and the potential of lost revenue should you simply choose to not use gift cards. It’s clear that the ease of gift cards make it beneficial to both the gift giver and the gift receiver and you mention that it takes the stress out of finding the perfect gift. I think it’s safe to say that gift cards are now becoming the perfect gift. Thanks again for the article!
Great post, Obviously people love to buy gift cards here they can get discount offers they can save money.
Gift Cards the tread of gifting is really increasing. As per above, post it more than that percentage of people love to receive gift cards instead of other gifts there are two benefits of gift cards if you give someone he can buy whatever he want or he can sell it for cash. Great post shared.