The B2B gift card landscape has continued to evolve rapidly, with the first quarter of 2024 presenting new trends and insights that are reshaping the industry. The holiday season of 2023 was particularly robust, exceeding our expectations in both consumer and corporate sectors. This report provides a comprehensive look at the latest trends, statistics, and projections for 2024, based on recent market data and our proprietary survey results.
Key Trends and Market Insights
Digital Transformation
The shift towards digital gift cards has accelerated, with a significant portion of holiday shopping now conducted online. In 2023, 20% of all Christmas Day purchases were made via mobile devices, reflecting a 12% increase from the previous year. This trend is driven by the convenience and immediacy that digital gift cards offer, both for purchasers and recipients.
Growth in Specialty Retailers
Specialty retailers, including bookstores, hobby shops, and electronics stores, have seen substantial growth in gift card sales. In the first half of 2023, purchases from these stores grew by 25%, highlighting a shift towards niche markets where consumers seek specialized products.
Consumer Spending Trends
Consumer spending on gift cards continues to outpace general retail spending. According to recent data from the Federal Reserve, overall consumer credit and debit purchases grew by 7%, while gift card activations increased by 10%. This growth rate demonstrates the enduring appeal of gift cards as versatile and desirable gifts.
Corporate Gift Card Usage
In partnership with the Incentive Gift Card Council (IGCC), the IRF found that 87% of companies who use non-cash incentives opt for gift cards as employee incentives, consistent with past years. The preference for traditional plastic gift cards remains high, with 88% of respondents favoring them over digital formats. However, the use of eCerts has increased slightly, indicating a gradual shift towards digital options.
Market Projections
The gift card market is projected to grow at a compound annual growth rate (CAGR) of 5.7% during 2024-2028, driven by the rising demand for digital gift cards and the expansion of the corporate gifting market. In the United States alone, the market is expected to reach $267.3 billion by 2028.
Regulatory Developments
Recent legislative changes, such as the new regulations in New Jersey requiring the registration of gift cards and the escheatment of unused balances after two years, pose challenges for retailers. These regulations necessitate updates to point-of-sale systems and compliance measures. Retailers must balance these requirements with maintaining consumer privacy and providing excellent customer service.
Conclusion
The B2B gift card market continues to thrive, driven by technological advancements, changing consumer preferences, and the robust demand from corporate buyers. As we move through 2024, staying informed about these trends and adapting to new market dynamics will be crucial for businesses looking to leverage gift cards as a strategic tool for engagement and growth.
Stay tuned for upcoming reports that delve deeper into industry-specific usage patterns and future projections.
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Sources
Fiserv - Q1 2024 Gift Card Gauge
LinkedIn - Gift Card Market Trends 2024-2032
LinkedIn - Gift Card Market: Share Insights 2024
Reloadly - 6 Gift Card Industry Trends Set to Shake Up 2024
BusinessWire - United States Gift Card Market Forecasted to Reach $267.3 Billion by 2028
RGCA - Gift Card Industry Research
ESM - More than Half of U.S. Firms Use Gift Cards as Rewards
