The Q1 Gift Card gauge from Fiserv, conducted in January 2023, assessed consumer attitudes towards gift cards. This provided good insight into what merchants can expect in 2023.
Inflation forces consumers to adjust their habits.
The purchasing power of consumers has declined during inflation. Consumers’ perceptions about gift certificates also change as they tighten the proverbial purse string. More than one-fourth (27%) plan to use gift cards for items they need. Another 22% will use gift cards to reduce the cost of things like groceries and gas.
How valuable are gift cards for consumers? Over 70% of consumers said they would save a gift card with $.50 remaining for a future transaction, and 42% would wait for a merchant’s promotion to extend the value of their gift cards. Penny-pinching has become “in.”
Gift cards are a vital part of milestone celebrations.
Nearly two-thirds (61%) of modern consumers use gift cards to commemorate important milestones.
In 2023, gift cards will still be purchased for birthdays and holidays. However, the consumer’s attention will also turn to other occasions. 44% of consumers will buy gift cards to express “congratulations,” while 33% will celebrate a high school or college graduation and 30% for “thank you.”
60% of consumers plan to purchase physical gift cards in the coming year. Asking for specific styles and designs, 30% of consumers prefer cards that depict milestone events.
Gift card promotions can help merchants increase revenue and stock up on supplies.
Loyalty programs are popular with consumers.
Loyalty programs will become even more valuable to consumers as inflation affects their purchasing power. Unsurprisingly, almost three-quarters (73%) of consumers join loyalty programs. However, 78% said they would use their loyalty points to purchase a gift card. This includes over 75% of those aged 18-44.
In today’s market, consumers are placing more value on cash-based rewards. If you’re a merchant looking to stand out, upgrading and evaluating your loyalty program could be the first step.
Gift Card Wish List 2023
Regardless of the market, gift cards are still a popular choice for consumers. Merchants should pay attention to gift cards for loyal customers. They should also promote them to procrastinators (53% are looking for a gift at the last minute), undecided shoppers (50% do not know what they want to buy), and discount shoppers (48% search out gift card promotions).
The size of the business consumers focus on is a mixed bag. Major brands will be the primary focus for 44% of consumers, while another 40% plan to purchase from a mixture of big brands and small businesses.
The consumers are evenly divided on where to buy gift cards. Distributors that sell gift cards from multiple brands are the most popular option (34%), followed by a merchant’s storefront (31%) and a merchant’s website (30%). These trends indicate that retailers should offer a physical and digital gift card purchase experience.
