Holiday season will be quickly approaching and as gift cards are still a growing part of most retailers businesses, they will be paying close attention to their gift card business and new gift card trends for 2014. By 2016 the gift card business is expected to grow by close to $20 billion. Of course this varies by industry, but it’s not all that unusual for a retailer to see as much as 50% of their fourth quarter business come from gift cards.
There are several new gift card trends that retailers need to be aware of as they begin preparing for the holiday season.
- One trend, and probably the biggest, is the growth of digital gift cards. Digital gift cards can be stored on consumer’s mobile phones and computers. Cards can easily be used online and some retailers are even accepting mobile phones at POS (or point of sale).
- Along with digital programs, retailers are developing a closer relationship between their gift cards and loyalty programs, offering their cards as part of loyalty program offerings and using gift cards in lieu of in-store discounts and other special offerings such as, “Buy X amount of dollars of product, and received a free gift card.”
- Trending on the environmental side, some retailers have considered replacing plastic cards with cards from a renewable material such as paper or wood.
Retailers need to start planning these programs out now and not let another year go by without a strong program in place. If a retailer waits until the end of the third quarter it will be too late to reap the rewards. And it’s not just the large retailers that are relying on the gift card market, many small and mid-sized businesses are also finding ways to offer gift cards.