Marketing

Gift cards trends to ring in the New Year

Gift Card Granny’s 2023 survey shares the latest trends in gift card usage and retail preferences.

Photo: Adobe Stock

December 6, 2023 by Jason Wolfe — Founder and CEO, The Wolfe Companies

As the retail landscape evolves, staying attuned to consumer preferences is crucial for retailers who put the customers' experiences first. Gift Card Granny's latest survey, encompassing over 4,000 U.S.-based consumers, sheds light on the 2023 trends in gift card usage and preferences, alongside valuable insights on shopping behavior for retailers preparing for the holiday season.

Gift card trends and CX

The shift toward eGift cards is more pronounced than ever. A significant 82% of respondents have used an eGift card this year, and 53% now prefer eGift cards over their physical counterparts. This highlights the importance for retailers to prioritize digital gift card options. The convenience and immediacy of eGift cards, coupled with their growing acceptance, underline a pivotal shift in consumer behavior. This preference is likely driven by the convenience and flexibility that digital cards offer, pointing to an opportunity for retailers to focus on enhancing their digital gift card experience.

Consumers no longer prefer the experience of buying a gift card off the rack at the store. They want convenience, security, and rapidness offered by online options. Retailers who want to put CX at the forefront of their business model should take note of the trends and make gift cards easy to find in online stores, with as great a variety of brands and gifting options as possible.

Retailers leading the 2023 holiday shopping season

In 2023, Amazon gift cards maintained their lead as the most requested gift card for the fourth consecutive year, with a respectable 76% preference rate. Visa follows at 51%, with Walmart closely behind. Notably, Starbucks and Target share the fourth spot with each garnering 34% indicating a split in consumer preferences.

Amazon also remains the dominant player in overall holiday shopping preferences, chosen by 43% of consumers. Walmart, Visa, and Target also continue to be top picks (each garnering less than 20% of the total market share), indicating their strong market presence. Retailers studying this trend could note which consumer shopping experience — in this case online and seamless — seems to attract the most customers. Brick-and-mortar locations should note the respective strengths of Target and Walmart that keep customers coming back.

Gift card purchasing habits and fraud

Some consumer habits around gift card purchasing are remaining steady. Last year, 27% of respondents shared that they purchased seven or more gift cards yearly for various celebrations, in comparison to 26% this year. The percentage of users who admitted to buying seven or more gift cards for personal use stayed at 17%. Notably for retailers who provide gift cards, over half of the consumers are influenced by promotions like reward points or cashback offers, a significant increase from the previous year. This trend suggests that retailers can effectively drive sales by incorporating enticing promotions like BOGOs into their gift card offerings.

A more worrying trend is the rise in gift card fraud. In 2023, 22% of respondents reported being victims of gift card scams, up from 13% in 2022. This underscores the need for retailers to invest in secure gift card solutions and educate consumers on safe practices to mitigate fraud risks.

Navigating the 2023 gift card landscape

The growing preference for digital gift cards, the impact of promotions, and the need for heightened security measures are key trends shaping the gift card market. As we approach the holiday season, understanding and adapting to these trends will be crucial for retailers aiming to maximize their gift card strategy and enhance customer experiences.

About Jason Wolfe

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Jason Wolfe is the Founder and CEO of The Wolfe Companies. He is a serial entrepreneur and community leader serving on several boards including the Board of Managers of the Milton Hershey School and the Board of Directors of the Hershey Trust Company. His vision of the ‘perfect gift’ that focuses on the recipient is the purpose of the company.

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