Gift cards a prominent force this holiday season
November 26, 2014

With the holiday shopping season fast approaching, retailers are looking for ways to improve sales and bring customers into their stores. There are many methods of making this happen, either through Black Friday sales or other promotional offers. However, that's on the assumption that people will want to buy someone something specific for the holidays. That's not always the case. An increasing number shoppers, struggling to find the ideal gift for their loved ones but uncomfortable giving cash outright, are turning more to gift cards as their solution. Merchants are now seeing gift card programs as an effective means in developing a customer base out of holiday shopping needs.

A better gift for all
Recent studies have suggested that customers like giving gift cards to loved ones during the holiday shopping season. The National Retail Foundation put up data from its recent Gift Card Spending Survey, and it discovered that the average person will spend $173.74 on gift cards for the 2014 holiday season. This is up nearly 10 dollars from 2013's average of $163.16. The current expectation is that $31.74 billion will be spent in total on gift cards for this season.

In terms of how much consumers spend per card, the numbers varied. For example, the average spending per card will go up more than two dollars to $47.87 this year. Seniors will likely spend the most on gift cards with an average of $204.59, while men will outspend women by about $15 overall.

The primary reason for spending on gift cards was because it allows their friends and loved ones to choose their own gift. It is essentially seen as a controlled form of money without it taking the form of cash.

As a result, the process of giving gift cards to people for the holidays is increasingly seen as a go-to solution for many gifting issues. In October, the NRF noted that 62 percent of consumers wanted to receive a gift card during this time period, making it the most popular gift item for the eighth consecutive year. On the other side of the spectrum, CashStar's surveys found that 55 percent of respondents went so far as to prefer gift cards over actual physical gifts. What certainly helps is that after-holiday form of self-indulgence: At least 66 percent of respondents said they felt less guilty spending money on themselves when they used gift cards to pay.

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