AMERICA’S MOST DESIRED HOLIDAY GIFT!

 

There can be no denying the shocking growth in popularity of gift cards. The market has grown by leaps

and bounds since the first gift cards were offered in 1994 by Neiman and Blockbuster. This year

estimated gift card sales are $131 B, up 6% from last year. In fact, since 2010 gift card sales have grown

by 31%! FUN FACT: In 1999 (The 1st year cardhub.com began tracking gift card sales.) total sales were only

According to Deloitte’s 2015 Holiday Survey, gift cards will be the 2

trailing clothes by only 2%. 46% of gifters plan on giving a gift card this holiday season, up 3% from

last year. (The NRF reports that for the 9

“shoppers” saying they want a gift card.) Consumers who buy them will spend and avg of $153, which marks the

first drop in avg spending on gift cards since 2009 ($172.74 avg in 2014). 2 is the most common number of

gift cards to be given this year as 28.6% of buyers say they will buy 2 gift cards this season. A whopping

15.4% say they will buy 6 or more, WOW!! The most popular gift cards to be given are to Restaurants

(34.8%) followed by Dept Stores (34.4%) and generic Visa/MC/AMEX/Disc gift cards (22.7%).

While tangible plastic gift cards are still the norm, 32% of gift cards will be given digitally. Digital gift

cards offer the advantages of immediate delivery, the inability to be lost as well as being environmentally

Speaking of losing gift cards, spillage (or unused gift cards) is expected to remain the same as last year with

$1B± in gift cards going unused. While 58% of gift card recipients plan to redeem their gift cards within

1 mo, another 21% are unsure as to when they will use them. The result is that $30B worth of gift cards

are lying dormant in their owner’s drawers, wallets, and purses. (WFLA Channel 8 NBC affiliate).

It is easy to see how gift cards could be construed as the “lazy man’s” gift to give. How many last minute

shoppers have been saved by running into a gas station or grocery store and buying a handful of gift

cards? From a gifter though the real VALUE of a gift card may be that they are frequently purchased as a

way to TRIM consumers gifting budget (cardhub.com). In 2011 27.1% said they bought them to trim their

budgets vs 13.4% who were too lazy to shop.

At least some part of recent growth may be attributed to legislation that passed to eliminate underhanded

business practices regarding gift cards. Prior to 2009, many gift cards contained hidden service charges and

fees for dormancy. The Fair Gift Card Act was introduced in 2009, and later that year the Credit Card

Accountability and Responsibility Act was passed into law to limit inactivity charges and service fees.

The act also set a minimum of a 5 yr expiration date for all gift cards or certificates. In 2010 gift certificates

sales broke a 2 yr period of negative growth with an increase of sales of 5%.

All in all, there are many reasons to buy a gift card this holiday season, whether it’s b/c you’d rather let

giftees make their own decisions, or trimming budgets or maybe you are just plain lazy.

No matter what the reason one thing is for sure, Americans LOVE their gift cards.

Please appropriately attribute. ©THX to, Vidhya Natarajan, Ian Young, Matt Grove, & Vinnie Paoletta for all your help & THX

nd most popular gift given this year

th consecutive year gift cards are the most wanted holiday gift with 58.8% of

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About bernacmd

For over 24 years, University of Detroit Mercy Marketing Professor Michael Bernacchi, Ph.D., J.D, has produced "uNDER tHE mIKE-rOSCOPE", a newsletter discussing current "marketing and advertising¹s bends, trends & ends." A well-know fixture in Detroit and national media, UDM's marketing guru has made several appearances on CNN's "Talk Back Live," the Voice of America worldwide radio network (VOA), ABC, CBS, NBC, MSNBC and on the pages of Sports Illustrated, Time, TV Guide, the New York Times, USA Today, the Wall Street Journal and the Washington Post, to name a few. At University of Detroit Mercy, he has taught courses in Marketing Management, Consumer Behavior, Marketing Communications, Research and Corporate Social Responsibility and Sports and Entertainment Marketing. Michael Bernacchi can be reached at 313-993-1116 or bernacmd@udmercy.edu. Please appropriately attribute the following for their work on uNDER tHE mIKE-rOSCOPE: Yen Ju Lee Robert Rouse Vidhyasagar Natarajan Eric Baumgardner & Ian Young
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