With the festive season looming around the corner, one cannot argue that the craze for purchasing gift cards vastly increases. As we step into the Halloween season and into the Black Friday period, followed by the Christmas peak, consumers have more than enough reason to buy gift cards for their loved ones.
It’s an exciting time of the year for sure! And with a call to standardise the gift card industry, now is the best time to explore it.
What’s the craze?
The gift card industry is a thriving one, and there are so many different reasons why people decide to purchase gift cards as gifts. Amongst many other reasons, 50.4% of consumers tend to buy gift cards for others because it gives them the ability to buy something that they actually like and want. Another reason why consumers buy gift cards is because it is much easier than shopping around for different gifts (this is 25.7% of consumers).
5.6% of consumers like to purchase gift cards because there are no concerns about needing to return gifts that do not fit or are not liked by the recipient. As well as this, 5.6% of consumers like to use gift cards because they are easier to email to the recipient.
Gift card history
But gift cards have a long history to them and were first around in the 1930s, specifically in 1932 and in the form of ‘The Book Token’. Since then, the idea of the gift card has evolved, including in the 1970s when McDonald’s began giving out their own Christmas gift certificates.
Fast forward to the year 1995 and you now have the first gift card as we know it today. It was the successful chain, Blockbuster, that was able to run a fruitful mass market gift card program. At the turn of the century, in the year 2000, Starbucks created the first reloadable gift card, now known as Starbucks Rewards…and the rest is history!
As far as technology goes, gift cards have since become available online and most have more than one store available to buy from with multi-store purchases available.
How do gift cards help businesses?
So what exactly are the best gift cards to invest in then? How do you know which ones are of more value, according to popularity? Of course, this will depend on who you are buying the gift card for, but there are also general favourites according to consumers.
For businesses, gift cards are a cheap way to market their brand and are an easy way to keep the consumer’s attention drawn to them.
Additionally, gift cards help businesses boost sales. Usually, gift cards are gifted with pre-loaded cash which the recipient can spend. However, the recipient does not need to cap their spending at this! They are likely to buy more than what is worth on the gift card, as they are still saving money doing so.
Standardisation in the gift card industry
Wouldn’t it be great if consumers knew exactly what to expect from a gift card? No wondering if it can be used both in-store and online. No wondering when it expires.
This raises the question of standardisation, which has been a hot topic in the gift card industry in 2023. Would it be beneficial to have a set of universally accepted gift card standards?
Gift card standardisation would benefit both consumers and retailers. For consumers, it would make gift cards more convenient and easier to use. For retailers, it would reduce costs and improve operational efficiency.
Download Savvy’s whitepaper on Standardisation to read more about this hot topic!