Gift cards are in a constant state of flux and here is why.
We have all received them. Every Christmas, Birthday, special occasion, and anytime someone wants to get rid of a card they too received as a gift. We get inundated with a large variety of gift cards. Some are the traditional style card similar to credit or debit cards. Some are gift codes. Some on a few rare occasions are still made out of paper. The truth is that they are convenient gifts and superb stocking fillers.
Year on year the gift card market in the UK grows by 29%. This rate of growth is truly admirable, with over 97% of online retailers offering some form of gift card. Over the next couple of years this is predicted to drop ever so slightly, however, it is then set to boom once again in 2018. This gives companies plenty of time to get on-board.
This being said, why should companies get on board? The statistics are very simple. 64% of gift card users spend over 34% more than the value of their gift card in store. What this means is that if a Waterstones customer gets given a £10 gift card they are actually far more likely to spend around the £13.40 mark. This is a superb return on investment from customers who would not necessarily be customers had they not received the card.
In the US e-gifting was introduced in 2014 as a major asset to the gift card market, although it did not take off at the rapid rate that was initially predicted. Instead it has been a slow burner. Now it is burning bright and is well on route to rapidly becoming a universal trading means by 2017.
Statistics aside, what does this mean for the universal gift card market?
Gift cards, although ever changing in terms of style and structure, are in the market to stay. They are a great means of stores and restaurants generating extra income, income which would not necessarily come in otherwise. Gift cards are a fantastic way of broadening an audience as well as ensuring that sales are in the till. They ensure that the point of sale is long enough in advance of the buying process that quite often gift cards offer a phenomenally large return on investment. Gift cards can truly make a business.
The market for digital vouchers is growing and at a phenomenal rate. It is worth investing in now in order to ensure that when the market inevitably rockets, companies are there and ready.
Gift cards are, quite simply, value for money in more ways than one.