Gift cards boom in lockdown - study
Jun 29, 2020
Gift Cards have been a key purchase during Britain’s lockdown and actually overtook physical gifts, a new study shows.
The Gift Card & Voucher Association (GCVA) said gift cards bought for someone else made up 14% of gifting spend in recent months, overtaking physical gifts at 12%.
The body spoke to 2,000 shoppers across the UK and found the most common reason behind this to be the understandably increased difficulty of buying physical items in lockdown. That was cited by 30% of respondents, with gift cards offering greater convenience.
Within the overall gift card spend, individual retailer cards made up 44% of overall market share and younger consumers said they were most likely to buy gift cards to support their favourite brands. In fact, 21% of consumers generally said they wanted to support their favourite businesses during a difficult period, “highlighting a growing trend among consumers to spend with brands that have prioritised customer service and loyalty”. The figure was 32.5% for those aged 16-24 and 33.8% for the 25-34 age group.
A subsequent increase in footfall to physical stores is expected as a result and while the retailers concerned have already banked the money for those gift cards, GCVA research has shown that shoppers usually spend much more than the gift card amount.
Shoppers typically spend an additional £18.55 more than the average card value (£27.64) when spending their gifts – an uplift of 67%.
And while individual retailer gift cards were most popular, multi-store cards were also bought by 38% of consumers.
Gail Cohen, director general of the GCVA, said that a key trend was noticeable during lockdown, known as “sunny day gifting”. She said this refers to when a gift card is purchased with the intention of being used at a later date once everyday life has returned to normal. “As shops continue to reopen their doors and the leisure sector gears up for reactivation, we anticipate a major surge in footfall,” she explained. Customers will “flock to spend the gift cards they have bought or received in lockdown, offering a much-needed shot in the arm for the sector that could benefit businesses for months to come.”
The research was conducted in association with GlobalData.
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