Global Gift Card Market, By Product (E-Gift Cards and Physical Cards), Functional Attribute (Closed Loop, Universal Accepted Open Loop, and E-Gifting), Industry Vertical (Retail and Corporate Institutions), Merchant (Restaurants, Discount Stores, Coffee Shops, Departmental Store, Grocery Store/Food Supermarkets, Entertainment, and Others) - Industry Trends and Forecast to 2030.
Gift Card Market Analysis and Size
The global gift card market is being driven by the use of gift cards as a business tactic, which is expected to drive market growth. Moreover, the extensive social trend of giving online gifts is potentially expected to boost the market growth. However, exploitative gift card practices such as redemption and latency fees are expected to restrain the market growth.
Data Bridge Market Research analyzes that the gift card market is expected to reach the value of USD 2,632,843.72 million by 2030, at a CAGR of 14.2% during the forecast period.
Report Metric
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Details
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Forecast Period
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2023 to 2030
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Base Year
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2022
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Historic Year
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2021 (Customizable to 2015 - 2020)
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Quantitative Units
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Revenue in USD Million
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Segments Covered
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Product (E-Gift Cards and Physical Cards), Functional Attribute (Closed Loop, Universal Accepted Open Loop, and E-Gifting), Industry Vertical (Retail and Corporate Institutions), Merchant (Restaurants, Discount Stores, Coffee Shops, Departmental Store, Grocery Store/Food Supermarkets, Entertainment, and Others)
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Countries Covered
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U.S., Canada, Mexico, Germany, Russia, France, U.K., Turkey, Italy, Spain, Poland, Netherlands, Belgium, Switzerland, Sweden, and Rest of Europe, China, India, South-East Asia, Japan, Australia, New Zealand, South Korea, Rest of Asia-Pacific, Indonesia, Philippines, Thailand, Vietnam, Malaysia, Singapore, Cambodia, Myanmar, and Rest of South-East Asia, Saudi Arabia, Iran, Egypt, South Africa, U.A.E., Iraq, Israel, Qatar, Kuwait, Jordan, and Rest of Middle East and Africa, Brazil, Argentina, and Rest of South America
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Market Players Covered
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Walmart Inc., Under Armour, Inc., Givex Corporation, American Express, Target Brands, Inc., Best Buy, Starbucks Coffee Company, PayPal Holdings, Inc., Apple Inc., Sephora USA, Inc., Gyft, Inc., Walgreen Co., TransGate Solutions, AMILON S.R.L., Jigsaw Business Solutions, Diggecard, Pine Labs Private Limited, Alltimeprint.com, Plastek Card Solutions, Inc., Card USA, Inc., Duracard, Blackhawk Network, Tango Card. Inc, Stockpile, Inc., and Huuray A/S
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Market Definition
A gift card is an artificial prepaid debit card that is loaded with a specific amount. It is used for various purposes, such as gifting someone and purchasing things. Most consumers, including millennials and the older generation, have a rising demand for gift cards due to their ease of use and the increasing adoption of smartphone payment technologies. The growing social trends of online gift-giving and rising demand from millennials are expected to drive market growth.
Global Gift Card Market Dynamics
This section deals with understanding the market drivers, advantages, opportunities, restraints, and challenges. All of this is discussed in detail below:
Drivers
- The Use of Gift Cards as a Business Tactic is Becoming More Popular
Various companies are becoming more focused on sustainable relationships with consumers so that they can meet their targets. There are a few benefits of gift cards that can be utilized in business strategies, such as they are cost-effective and consumers usually spend on gift cards instead of physical gifts. This is because most individuals have a perception of gift cards amount as free money. So the implementation offers associated with gift cards can actually boost the revenue of a company.
Gift cards also can increase traffic at a particular store and organization. As it invests two persons into the process, one is the sender, who is giving the gift card, and the second is the recipient, who is receiving the gift card. Many times it happens that the gift card got expires, unused, and the whole amount goes to the organization. Therefore, utilizing gift cards as a business strategy is an essential and cost-effective decision, which is expected to drive market growth.
- The Extensive Social Trend of Giving Online Gifts
Along with the economic growth of consumers and the increased awareness of social trends among the population, the situation for the gift card market has been changing. Online gifting has gained popularity due to its convenience and accessibility. With just a few clicks, customers can purchase and send digital gifts to recipients anywhere in the world. This makes gift cards an attractive option for last-minute gifting purposes. The growing trend of online shopping and digital transactions continues to grow the preference for gift cards, which is expected to drive market growth.
Opportunities
- The Growing Internet and Smartphone Penetration Rate Worldwide
The growing popularity of e-commerce enables the user to use gift cards easily and explore more product with easy purchases. One of the most innovative fields of technology in the gift card market is the introduction of smartphone technology. The benefits of e-gift cards using smartphone technology in payment methods enables a wide range of consumer base who can provide growth to the market with enormous opportunities. Continuous launches and announcements in the segment of mobile wallet gift cards and e-gift cards and their increasing trend can lead the gift card market to face extreme growth in the near future. E-Gift cards are considered a good alternative form of payment if any consumer has no cash to pay for a product, as they can be transferred digitally if the recipient lives in longer distance from the sender of the gift cards. Thus, these benefits are creating a preference for e-gift cards, and companies are launching new product, which are expected to provide an opportunity for market growth.
- Strategic Alliances to Increase Company’s Business Penetration
Strategic alliances are a key staple in business strategies to achieve a competitive advantage and abate competitors from moving on a marketplace. A successful strategic alliance is critical to the success of a core business goal and also helps in mitigating a significant risk to the business. Alliances help in providing access to the market with a solution that would not have been possible for any company on its own. With the right alliance, partners can out space the competition with new solutions. This helps in scaling up the production and building innovative solutions for their customers, entering new markets, and pooling valuable expertise and resources, which is expected to provide an opportunity for market growth.
Restraints/Challenges
- Exploitative Gift Cards Practices such as Redemption and Latency Fees
A gift card is an alternative method of payment that customers can use to make payments at various locations, such as retail stores, restaurants, gas stations, and others. Money can be added to the card and spent at the accepted premises. Gift cards come with many advantages for customers. They are more convenient and a better substitute for hard cash, but they still have some disadvantages. Due to these negative factors, the market growth market can be hampered.
Exploitative practices such as latency fees and redemption fees can affect the market negatively. Some gift card issuers impose redemption fees when the card is used. These are the charges deducted from the card’s balance. It results in reducing the value of gift cards and discourages recipients from utilizing them completely. For the consumers, it creates a negative experience and lessens their trust in the gift card system. It is a possibility that customers might buy or accept gift cards less if they perceive that their gift card is subjected to some hidden charges. This is expected to restrain market growth.
- Security Concerns such as Hacking and Fraud Associated with the Gift Cards
Most gift cards have a service life of up to a few years and are intended for short- to medium-amount purchases. Despite a wide preference for gift cards, a few issues associated with security are also there. With the increasing amount of revenue generated from using stored value cards or gift cards, the security problems associated with gift cards are also increasing, such as hacking issues and lack of security for the money.
Hackers can access the gift card by directly going to the website where the consumer is accessing their gift cards. This can be done by using a botnet attack which provides the hackers millions of combinations of gift card account numbers and stolen PINs or passwords by which the hacker can log in to the online gift card and load the money to their account. This is expected to restrain market growth.
- The Threat of Substituents such as Merchandise and Electronic Items as Gifts
The gift card is well known for consuming a large amount of consumer base companies who give their employees gift cards as a bonus or appreciation. There is a good record of unused gift cards as people generally tend to use the gift cards they receive, but either the card expires, they lose it, or they are left unredeemed. There are few trending alternatives available in the market for gift cards which can give the market a challenge to grow.
For instance,
- According to the poll conducted by Bankrate, LLC., which is a giant financial service provider, 51% of the U.S. adults waste gift cards worth 15.3 billion USD countrywide
Furthermore, alternatives based on personalized branded merchandise such as jackets, hoodies, or sweatshirts are coming into the rising trend for gifting purposes. This kind of product is appreciated by most of the recipients over gift cards because, most of the time, gift cards get unused and unredeemed. Other options, such as smart water bottles with customized logo prints and power banks, are facing a rising trend in terms of gifting in bulk (such as employees of a specific firm or students of a particular institute). In addition, online magazine subscriptions and OTT subscriptions are also entering the competition for alternatives to gift cards
Recent Developments
- On 29 October 2020, PRNewswire has released an article named “rise in digital gifting paves way for new, more personal e-gift card options available at Giftcards.com”. Giftcards.com has expanded their digital gift card offers. They provide a variety of unique gift cards to their customers who wants to give more personal gifts. Every card is designed for a specific occasion, recipient or particular cause. They are offering several new e-gifts without any fees.
- On 9 April 2021, thought works published a blog. According to that, for retailers gift cards have become potential entry points to guide the customers into the closed loop of payment, membership and ordering system. They can cultivate users to generate new expenditure habits. For instance, Starbucks Gift Card is not only designed for gifting, but it also provides the customers with an ease of payment method and also increases the frequency of store visits. This has increased their sale automatically.
Global Gift Card Market Scope
The global gift card market is categorized into four notable segment, by product, functional attribute, industry vertical, and merchant. The growth amongst these segments will help you analyze major growth segments in the industries and provide the users with a valuable market overview and market insights to help them make strategic decisions for identifying core market applications.
Product
- Physical Cards
- E-Gift Cards
On the basis of product, the market is segmented into e-gift cards and physical cards.
Functional Attribute
- Closed Loop
- Universal Accepted Open Loop
- E- Gifting
On the basis of functional attributes, the market is segmented into closed loop, universal accepted open loop, and e-gifting.
Industry Vertical
- Retail
- Corporate Institutions
On the basis of industry vertical, the market is segmented into retail and corporate institutions.
Merchant
- Restaurants
- Discount Stores
- Coffee Shops
- Departmental Store
- Grocery Store/Food Supermarkets
- Entertainment
- Others
On the basis of merchant, the market is segmented into restaurants, discount stores, coffee shops, departmental store, grocery store/food supermarkets, entertainment, and others.
Global Gift Card Market Regional Analysis/Insights
The global gift card market is analyzed, and market size insights and trends are provided by country, product, functional attribute, industry vertical, and merchant, as referenced above.
The countries covered in the market report are U.S., Canada, Mexico, Germany, Russia, France, U.K., Turkey, Italy, Spain, Poland, Netherlands, Belgium, Switzerland, Sweden, and Rest of Europe, China, India, South-East Asia, Japan, Australia, New Zealand, South Korea, Rest of Asia-Pacific, Indonesia, Philippines, Thailand, Vietnam, Malaysia, Singapore, Cambodia, Myanmar, and rest of South-East Asia, Saudi Arabia, Iran, Egypt, South Africa, U.A.E., Iraq, Israel, Qatar, Kuwait, Jordan, and rest of Middle East and Africa, Brazil, Argentina, and rest of South America.
North America is expected to dominate the global gift card market because gift cards are gaining rapid popularity among consumers, U.S. is dominating country in the region. Asia-Pacific is estimated to be the fastest-growing region in the global gift card market due to increasing awareness and rising trends among gift cards, China is dominating in the Asia-Pacific region. Germany is the highest growing country in the Europe region as e-gift cards are becoming increasingly popular among millennials.
The country section of the report also provides individual market-impacting factors and changes in market regulation that impact the current and future trends of the market. Data points like downstream and upstream value chain analysis, technical trends, porter’ five forces analysis, and case studies are some of the pointers used to forecast the market scenario for individual countries. Also, the presence and availability of global brands and their challenges faced due to large or scarce competition from local and domestic brands, the impact of domestic tariffs, and trade routes are considered while providing forecast analysis of the country data.
Competitive Landscape and Global Gift Card Market Share Analysis
The global gift card market competitive landscape provides details by competitor. Details included are company overview, company financials, revenue generated, market potential, investment in research and development, new market initiatives, global presence, production sites and facilities, production capacities, company strengths and weaknesses, product launch, product width and breadth, and application dominance. The above data points are only related to the companies' focus on the market.
Some of the major players operating in the market are Walmart Inc., Under Armour, Inc., Givex Corporation, American Express, Target Brands, Inc., Best Buy, Starbucks Coffee Company, PayPal Holdings, Inc., Apple Inc., Sephora USA, Inc., Gyft, Inc., Walgreen Co., TransGate Solutions, AMILON S.R.L., Jigsaw Business Solutions, Diggecard, Pine Labs Private Limited, Alltimeprint.com, Plastek Card Solutions, Inc., Card USA, Inc., Duracard, Blackhawk Network, Tango Card. Inc, Stockpile, Inc., and Huuray A/S among others.
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