An interim holiday spending report released by Stored Value Solutions (SVS), a global provider of gift cards and stored value services, found that spend on prepaid gift cards is on the rise, and that a significant majority (70%) of shoppers plan to purchase gift cards this holiday season.
According to the report, a whopping 92% of shoppers plan to spend either the same amount or more on gift cards than they spent last year. And for the eighth straight year, gift cards have been the most desired holiday gift.
SVS has been tracking gift card data for nearly a decade, but this is the first report to be issued publicly on this sector of holiday retail spending, a category whose numbers are difficult to capture in the aggregate. The inaugural report provides detailed break-downs of gift card spend by sector, geography and demographics.
While there are numerous surveys published at this time of the year looking at gift card spending, SVS’s research is tracked against actual real-time activity the company sees firsthand, including first-time gift card sales, increases or decreases in same-merchant sales, and average dollar amounts loaded onto the gift cards. SVS
“The actual real-time spending data we possess allows us to test the survey results, and at this time in the holiday season, we’re able to identify some close correlations between intention and actual activity,” said Managing Director and Executive VP Mark Schatz. “That’s always a hard thing to nail in a consumer survey.”
In addition, SVS’s real time data is also able to correlate gift card spending with more macroeconomic retail spending trends, seeing a commensurate rise in the dollar value of gift card spending when overall sales are on the upswing.
Other findings of the study include:
- The average consumer plans to spend $231 on gift cards.
- Men are planning to spend more on gift cards than women.
- 90% of consumers that have finished some, but not most of their shopping (26 – 50%) are planning to purchase gift cards.
- 58% of younger people (18-35) are planning to increase the amount they are spending on gift cards.
Schatz added, “Because we’re able to pinpoint the ways people use gift cards, we can draw interesting insights not only about the general state of consumer shopping behavior, but about how this changes by generation, by channel and by gender. This holiday season is a reflection of a pattern we’ve seen unfolding for some time.”
With no consumer fees and no expiration date for a minimum of five years, gift cards have become a winning proposition for holiday gift giving, as they allow the recipient to choose what they want from their favorite brands.
SVS conducted this research to understand consumers’ intended gift card purchases as holiday gifts in 2014 relative to their spending in 2013. A nationally representative sample of 1000 adults 18+ completed a brief survey Dec. 1-2. Some 696 adults confirmed they had already purchased or intend to purchase gift cards this holiday season.