It’s the season of gift card purchases, but will sales be as robust as in past years?
While gift cards remain the most requested holiday gift, they seem to have fallen off consumers’ shopping lists this year. Torn between the love of a great deal and settling for a gift card, the latest National Retail Federation’s (NRF) Gift Card Spending Survey found that those planning to buy gift cards will spend slightly less on average ($153.08 vs. $172.74 last year), the first drop in average spending since 2009. Total spending is expected to reach $25.9 billion.
In NRF’s first holiday survey released in October, 58.8% of shoppers said that they would like to receive a gift card, making them the most requested gift item nine years in a row.
“Retailers’ early promotions and exclusive offerings have made it easier for consumers to find everything they need without having to consider raiding the gift card rack,” said NRF President and CEO Matthew Shay. “That said, there is an interesting disconnect between gift givers and gift recipients this year as gift cards still top millions of Americans’ wish lists.”
“Regardless, there’s no question that early birds and procrastinators alike will still look to gift cards to help make the holidays bright,” continued Shay.
According to the survey, shoppers plan to spend an average of $44.83 per card. Adults 65+ who plan to buy at least one card will spend the most overall, spending an average of $186.44; this same age group will also spend the most per card ($47.88). Again this year, men plan to spend more than women on gift cards ($162.01 vs. $144.62 respectively).
Of those who plan to buy at least one card, half (50.4%) understand the practicality of the cards and said they will buy gift cards because they allow the recipients to select their own gift. Nearly one-quarter of shoppers (24.7%) plan to guy gift cards because they know they are easier and faster to buy than traditional gifts and 5.6% said gift cards are easier to mail and ship to out-of-town family and friends.
“After years of exchanging gift cards over the holiday season, consumers may want to try to avoid the potential awkward exchange when the card they’ve given their loved ones are worth less or more than the one they’ve received,” Prosper’s Principal Analyst Pam Goodfellow said. “However, there will always be an appetite for gift cards, especially with procrastinators who will wrap up their shopping in the final hours.”
With an abundance of purchase options, department stores, restaurants and coffee shops are the top choices for the majority of holiday shoppers. According to the survey, 34.8% of shoppers will treat their loved ones to a meal at a restaurant, and 34.4% will pick up a gift card for a department store. One in five (20.1%) will choose a gift card for a coffee shop, 17.2% will opt for an entertainment gift card such as for movies or sporting events, and 15.8 %p will choose an electronics store.
The NRF 2015 Gift Card Spending Survey was designed to gauge consumer behavior and shopping trends related to the winter holidays. The survey polled 7,172 consumers and was conducted for NRF by Prosper Insights & Analytics, Nov. 3-10, 2015. The consumer poll has a margin of error of plus or minus 1.2 percentage points.