Birthdays are at the top the list of occasions to give gift cards, leading consumers to buy more gift cards all year round, according to a survey commissioned by gift card provider First Data.
The survey found that, from specialty and discount retailers to coffee shops and quick service restaurants, the diverse range of gift card products available to consumers is driving a continuing growth in popularity.
Most popular occasions
According to the 2007 US Gift Card Consumer Insights Survey, gift cards continued to gain in popularity in 2007, with 90% of American adults saying they had purchased or received a gift card in the previous 12 months, and 60% having both given and received gift cards during that time. This, the company noted, represented a significant increase over the previous year's results.
Birthdays and Christmas are the two most common occasions to give gift cards. Among gift card purchasers who purchased gift cards that can only be used at one retailer, 68% bought at least one gift card as a birthday gift, while 61% bought at least one card as a Christmas gift.
Other popular occasions include graduations, weddings, Mother's Day and Father's Day, but "thank you gifts" and "no special occasion" were also frequently cited as reasons.
Increase in frequency
Consumers are buying more gift cards, the survey found. The majority of gift card purchasers (88%) bought more than one card. On average, consumers who purchased cards that can be used at a single retailer had bought 5 gift cards in the previous 12 months and spent an average of US$46 on each.
When redeeming the cards in-store, gift card recipients spent an average of US$29 more than the original value of the card.
Single-retailer cards more popular
The study also found that gift cards that can be used at a specific retailer are purchased more frequently than those that can be used at multiple retailers, with 28% of gift card purchasers choosing gift cards that could be used at a variety of stores, restaurants or other retailers.
The top reasons given for purchasing gift cards were:
- The receiver can buy what they want (72%);
- The convenience of purchasing (43%);
- Flexibility in redeeming a gift card (38%);
- Not knowing what to buy the receiver (33%).