Who Buys Gift Cards? The 3 Audiences to Reach
If you are a retailer looking to get started with a gift card programme, you might be wondering who will be targeted by your gift cards! While they remain a staple of gift-giving around the world, you may be surprised to know who buys them – and why! Today, we delve into three key audiences who buy gift cards: B2B consumers for employee reward platforms, Gen Z, and self-gifters.
Gift cards for self use
Last year it was revealed as an industry that there is a significant amount of ‘self-use’ in gift cards! In fact. self-use growth has nearly tripled between 2013 and today, especially online, rising from a 20% participation rate to nearly 60%, mainly among Millennials and Generation X.
In the US, nearly 60% of the population engages in self-gifting, with discounts being a top motivator. In the UK, 47% of shoppers purchase gift cards to spend on themselves.
Convenience and budgeting are important factors driving self-gifting in the UK, with men being particularly inclined towards this trend. In Germany, self-use is extremely popular, especially when gift cards are bought online, driven by convenience. Self-use provides consumers with a designated spending amount, helping them avoid impulse buying and unnecessary expenses.
The self-use segment of the gift card market is developing at different paces worldwide. While some countries, such as the US and the UK, have embraced self-use, others, like France and China, are still in the early stages of adoption. However, the trend is expected to continue growing and impact the evolution of the gift card market globally.
B2B consumers
Gift cards play a significant role in B2B programs, allowing organizations to build meaningful interactions with their employees by offering gift cards as a discount or a reward. They slot into incentives and rewards, and as such, brand gift cards can be used as tokens of appreciation or rewards for high-performing employees. Digital gift cards have gained prominence in this space due to their speed, reliability, and flexibility ideal for a hybrid or remote working team.
According to 90% of consumers, gift cards are seen as an appropriate employee reward, 75%
say a gift card from their employer enables them to buy what they want, and 79% say incentives from their employer make them feel valued and appreciated. This is one market that is going nowhere!
The B2B space is not just about employees, and also includes the element where a brand will want to offer a gift card as a reward or an incentive to their customers! Many brands are currently selling to customers or their customers in this way – and it’s a huge market!
Gen Z
Think Gen Z are so over gift cards? That’s not true! Gen Z, the generation born between 1996 and 2012, is expected to be a significant driving force in gift card usage and holiday spending. According to the NRF and Prosper Insights & Analytics 2022 Consumer Holiday Survey, Gen Z consumers are planning to increase their holiday gift card spending by 57%, from $185 in the previous year to $290.
In addition to purchasing gift cards as gifts, Gen Z also buys them for personal use. This is particularly true for younger members of Gen Z who may not have credit or debit cards yet. For online purchases, 18% of Gen Z respondents stated that they use cash to buy gift cards as a form of payment. Furthermore, 11% mentioned using gift cards because they do not have a credit or debit card. Gen Z’s affinity for shopping and retail therapy makes gift cards a popular choice for them, as they are more likely to spend above the gift card amount.
Reach the ideal audience
The right gift card solution is key to unlocking commercial success. As a 360 service agency, RLC makes it easier for brands to leverage the power of gift cards by providing sound guidance and hands-on support. Get in touch with us today to discover how we can help!