Gift card rewards are more popular than ever. Brands use gift cards, both plastic and electronic, to accomplish a variety of objectives: encourage consumer spending, reinforce brand values and reward loyal customers who appreciate the flexibility that gift cards provide.
By the numbers
Whether your brand is considering supplying its own gift cards to other rewards programs or adding gift cards to its loyalty offerings, we’ve compiled some stats to help you decide:
- The gift card market is booming. Research shows that gift card spending has increased from $40 billion in 2003 to over $100 billion in 2014 (Mercator Advisory Group).
- 98% of U.S. businesses with non-cash incentive programs include merchandise or gift cards and spend $54.3 billion each year to reward employees, partners and customers (Incentive Federation Market Study)
- According to a COLLOQUY study, gift cards rank highest (52%) for encouraging shopping at a specific store
- Most U.S. consumers - more than 51% - have purchased or received an electronic gift card in the past year, and 81% said they intended to purchase the same amount of or more gift cards in 2015 (Loyalty360)
What does it mean for brands and program managers?
It means, of course, that consumers like gift cards. To steal a line from The O’Jays, “Give the people what they want.” Rewards members like gift cards because they offer flexibility (read: consumer choice), and program managers have noticed. According to an Incentive Research Foundation report on merchandise and gift card programs in 2015, budgets are trending up – almost 50% of planners say they will be increasing their budgets.
Our clients have experienced first-hand how much consumers like gift card rewards. At Connexions’ in-house gift card fulfillment facility, we deliver roughly 10 million gift card rewards annually for nearly 300 brands. Many of the top rewards programs include various non-cash rewards like merchandise and travel. Adding gift cards to the mix can strengthen your program by offering your members more choice on incentives they actually want and will use.