In a holiday shopping season that saw retail sales grow by 4% over 2023, gift cards emerged as the stars, showing significant year-over-year growth. According to Blackhawk Network (BHN), 56% of surveyed consumers reported purchasing a gift card this holiday season, an 8% increase from the previous year. The average value of gift cards received also jumped to $209, up from $161 last year.
With a shorter holiday shopping season, flexible delivery options made digital gift cards the go-to for last-minute shoppers. Forty-nine percent of surveyed consumers purchased digital gift cards this season, a 5% rise over 2023. Gen Z led the charge, with 60% purchasing digital gift cards, while Boomers were twice as likely to buy them at the last minute.
AI, promotions and post-holidays
Sixty-five percent of younger generations and 37% of older generations used AI, finding it invaluable for finding the best prices, getting product recommendations, creating gift lists, simplifying shopping, and making purchases.
Deals, promotions, and loyalty points helped ease holiday financial stress, giving consumers extra spending power. Seventy-seven percent of surveyed consumers took advantage of these opportunities, saving an average of $151 and using their savings to buy more gifts. More consumers also turned loyalty points into holiday treasures compared to last year.
As consumers use their holiday gift cards in the first two months of the year, retailers can capitalise on post-holiday success. Eighty-three percent of consumers enjoy using gift cards for post-holiday deals. With holiday returns on the rise, gift cards offer a golden opportunity for retailers. Twenty-two percent of surveyed consumers plan to return gifts, with 80% preferring gift cards as compensation. Additionally, 80% of shoppers plan to spend more than the value of their gift cards, averaging $81 over the card’s value, making gift cards a win-win for everyone.
Jay Jaffin, chief marketing officer of BHN, said: “Gift cards not only encourage foot traffic and repeat business, but also enable merchants to acquire new customers who are eager to spend their holiday gift cards in the beginning of the new year. Our research also found that gift cards helped consumers alleviate some financial stress during and after the holidays. Seventy-four percent of consumers said purchasing gift cards assisted them in sticking to their holiday budget and 59% said receiving a gift card eases financial stress after the holiday shopping season.”