Carat from Fiserv’s Q1 2024 Gift Card Gauge reveals that while milestone events like birthdays and graduations drive most gift card sales, they are not the only driver of consumer engagement. Examining consumers’ technology usage, regional habits, and emerging gift card industries sheds light on how merchants can optimize their gift card programs in 2024.
Stimulate more sales by keeping up with the latest gift card trends
Consumers continue riding the digital wave, especially those in urban areas. Three-quarters of today’s shoppers use digital wallets, and 60% plan to use them more this year. For avid users, digital wallets are considered more convenient (60%), faster (41%), and more secure (40%). To capitalize on this trend, merchants must ensure seamless integration with the most popular digital wallet platforms and drive consumer engagement through functionalities, including in-app promotions and loyalty discounts.
Location matters for consumer purchasing patterns
Recent census data shows that roughly 80% of U.S. consumers live in urban areas, creating a unique opportunity for merchants to cater to this audience—consumers who crave a digital, on-the-move lifestyle.
Compared to suburban and rural consumers, urban dwellers are twice as likely to use a peer-to-peer (P2P) payment app to purchase a gift card. Further, urban consumers are 17% more likely to use a digital wallet than their suburban and rural counterparts and 16% more likely to purchase a health and wellness-related gift card.
Online gaming gift cards show big potential
Although retail stores (57%) and restaurants (52%) remain the biggest industries for gift card purchases, others are on the rise. For example, roughly a third of consumers indicated they recently purchased online gaming gift cards.
While gaming has long been a valuable industry for merchants, gift cards are emerging as an important tool to keep gamers coming back. Of the 32% of consumers who bought their first online gaming gift card in 2023, 84% plan on purchasing more in 2024.
Reminding shoppers of unused balances is useful
Reminding consumers about unused gift card balances via push and in-app notifications can help merchants boost revenue. Roughly four in 10 consumers have a fear of forgetting about their digital gift cards. Furthermore, our 21st Annual Prepaid Consumer Insights survey revealed that 79% of consumers say they typically spend more than the balance of their gift card when shopping.
A gentle reminder that remaining gift card balances could inspire many consumers to do more shopping with their favorite merchants.
Prompt more gift card purchases with promotions
For merchants experiencing a drop in sales, consider offering gift card promotions. While milestone events are a gift card staple and a go-to for consumers needing to purchase a gift quickly, most consumers stretch their gift card purchasing power through promotional events. Specifically, 54% buy gift cards at a discount, 52% purchase them during a promotional bonus period, and 24% will reload gift cards for a bonus.
Savvy merchants know promotions can work wonders on gift card sales.
Download the report for more findings from the Q1 2024 Gift Card Gauge, or contact us today to learn more about how we can help implement a gift card program that's right for your business.
Fiserv’s Q1 2024 Gift Card Gauge is a survey of over 1,000 U.S. consumers aged 18 and older, conducted to help merchants better understand industry trends and how consumers use gift cards. The margin of error for this Gauge is +/- 3.04%.
