Four Shocking Stats about Gift Cards and why you Should Care: A study by the Blackhawk Network

Gift cards have become an integral part of modern commerce, offering convenience and versatility for both consumers and businesses alike. Despite gift cards becoming an expectation of today’s consumers, a surprising number of retailers have still failed to adopt gift cards as a key payments and marketing strategy. Blackhawk Network (BHN), the leader in global branded payment technologies, has identified several shocking statistics that make the business case for gift cards undeniable. This article will dive into some of our favorites.

‍

Stat #1: $2.1 Trillion — The Expected Gift Card Market by 2028

The sheer scale of the gift card market is staggering. With an expected value of $2.1 trillion by 2028, gift cards continue to dominate as the top gift choice for consumers. For businesses, this underscores the importance of embracing gift cards as a strategic tool for driving sales and fostering brand loyalty. As brand ambassadors increasingly turn to gift cards to share their favorite products with others, businesses have a prime opportunity to leverage this trend and capitalize on the inherent value of gift card programs.

‍

Stat #2: 500% — The Amount That People Spend Over Their Gift Card Value

Gift cards are not only a gift in themselves, but they also serve as a catalyst for additional spending. The staggering 500% increase in spending over the gift card value highlights the significant upsell potential associated with gift card redemptions. Lower denomination gift cards seem to result in the most dramatic upsell % with BHN’s study showing that a $10 gift card value often resulted in an average of a $51 purchase. With gift cards, businesses can entice customers to spend more, resulting in higher average transaction values and increased revenue.

‍

Stat #3: 59% — Gift Cards That Remain Unredeemed

Despite their popularity, 59% of gift cards purchased by consumers go unredeemed. This trend, particularly prevalent among Gen Z consumers (77% of their gift cards purchased go unredeemed), underscores the importance of modernizing gift card tactics to improve redemption rates. Embracing digital gift cards offers a solution by providing consumers with convenient and flexible redemption options. By enabling omnichannel redemption and streamlining the redemption process, businesses can reduce the number of unredeemed gift cards and maximize their revenue potential.

‍

Stat #4: 5% — Gift Cards Can Contribute an Average of 5% of a Company’s Revenue

Gift cards are not just a token gesture; they are a powerful revenue driver for businesses. By integrating gift cards into their payment strategy and leveraging marketing tactics such as loyalty programs and marketing orchestration platforms, businesses can further enhance the revenue-generating potential of gift cards. For enterprises that have embraced gift cards as a strategic initiative, they have witnessed substantial contributions to their overall revenue, with some reporting up to 8% of their total revenue coming from gift cards. This highlights the significant impact that well-executed gift card programs can have on a company's bottom line.

‍

Conclusion

These four shocking stats that illustrate the potential of gift cards as a revenue-driving tool for businesses cannot be ignored. By understanding and leveraging the inherent strengths of gift cards, businesses can unlock new opportunities for growth, drive customer engagement, and maximize their revenue potential in an increasingly competitive market landscape.

Click here to learn more about the power of gift cards from our partner Blackhawk

‍