Over the years, the gift card market has been booming. So booming, in fact, that the gift card industry was expected to exceed $150 billion dollars by 2018. But how can such a small piece of plastic have such a high revenue impact? It all boils down to customer behaviour.
Gift cards aren’t just a convenient and popular present – they are an experience1. Whether it’s encouraging someone to shop at a store they’ve never visited, or making them feel as though they’re getting a “discount” or “freebie”on a purchase from a favourite business, the positive mental impact of gift cards should not be underestimated.
The gift card industry has grown and adapted as customer behaviours have evolved. Here are 3 customer behaviour insights that we’ve uncovered.
1. Customer behaviour shows increased demand for digital gift cards
Do you offer digital gift cards (or eGift cards) on your website? If your answer is no, you may be missing out on an opportunity for extra revenue into your business.
In 2018, 55% of customers2 showed interest in either giving or receiving digital gift cards, especially within the younger generation.
In addition, not only are digital gift cards more accessible for costumers, but they also allow the ability to personalize the image and message from buyer to receiver.
Customizability and accessibility are key factors in why interest continues to grow in the world of digital gift cards.
READ MORE: Why Electronic Gift Cards Benefit Retailers
2. Customers are using gift cards to market brands
Did you know that, by buying a gift card to influence purchasing decisions within their social circle, customers are acting as brand ambassadors?
A potential customer is more likely to shop at a store if there is an influential factor, such as receiving a gift card. In fact, 11% of consumers3 aged 18 to 34 are more likely to visit a store they would not otherwise visit because they’ve received a gift card.
3. Customers are increasingly buying gift cards in bulk
Although still a top seller for birthdays or during the holidays, customer behaviours show more and more customers are now using gift cards as a way to treat their own employees or clients. In other words, many customers are purchasing gift cards in bulk.
For example, many realtors use gift cards as a way to thank their clients who recently purchased a new home.
This bulk gift card buying behaviour means that gift card program administrators should ensure that they always have a steady supply of gift cards on hand. Secondly, they should consider expanding their offering to include complimentary gift card designs with themes like “Thank You” or “Happy Holidays”.
The Rules of a Gift Card Program (from coast to coast)
Did you know that each province has their own regulations on gift cards? If you are considering a gift card program, the link below will be a helpful resource to understanding some of the rules and regulations around gift card programs across Canada by province.
- A Complete Guide to Gift Cards for Small Businesses. https://www.giftsvouchers.co.uk/blog/complete-guide-to-gift-cards-for-small-businesses. Accessed March 8, 2022.
- Blackhawk Network. The State of Consumer Gift Card Preferences in 2018. https://blackhawknetwork.com/consumer-gift-card-preferences/#top. Accessed January 18 2018.
- First Data. The Evolution of Branded Currency. https://www.firstdata.com/first-feature/consumer-insights-2017/images/Consumer-Insights-v10.pdf. Accessed January 18, 2018.
Want to know how you can integrate a gift card program into your business? We can help! Contact us to chat with an Ackroo rep!