Stored Value Solutions found that the overall dollar value loaded on gift cards in the U.S. was up 3 percent year-over-year for the period of Thanksgiving through December 25. In the same period, the number of cards purchased was up by 1 percent.
However, gift card sales by dollar value in the Dining category increased by 8 percent year-over-year and spending in the Entertainment category was up by a sharp 18 percent year-over-year for overall dollar value spent. In both cases, the year-over-year percentage increase was slightly higher than the increase in the number of cards purchased, meaning that people were not only purchasing more cards in those categories, but on average, they were loading a higher value onto the gift cards.
“In our ongoing Holiday Watch series, where we’ve been tracking first-time gift card activations since Thanksgiving weekend, sales continue to reflect that Entertainment and Dining are the biggest growth categories,” says Jenny Parris, senior vice president of global marketing and product at Stored Value Solutions. “This indicates that consumers seem to be leaning more towards experiential gifts. And when it comes to gift cards, good weather is helping drive increased traffic to dining.”
The use of gift cards for promotions campaigns, increasingly popular among restaurants and retailers, is also tracking positive results. According to Parris, the response rate of people actually returning to use their promotional card has been between 45 percent and 60 percent, where a typical coupon redemption rate is considerably lower at 2 percent to 7 percent.“Retailers achieve this without discounting for every single person who walks in the door,” she says. “Gift card promotions reward people who are willing to buy from retailers and then come back to the store.”