Gift cards in 2023: What’s in store for the future?

Whether you are a retailer, a hotel manager or a restaurant owner, you’ll appreciate that your business hits many peaks throughout any given year; from Valentine’s day to Mother’s and Father’s day, to Black Friday and everything in between, reaching an almighty crescendo with the Christmas season.

A woman using an online gift card on an iPad.

This continuous series of dates in the shopping calendar means retailers need to stay two steps ahead at all times. With that in mind, we’re sure your plans are already in motion for the unchartered territory of 2023. But what exactly might this fresh new year have in store for the gift card industry?


A snapshot look at 2022

Before we bowl straight into 2023, let’s reflect a little on what 2022 looked like. 2022 certainly brought an entirely new set of challenges. However, it was arguably the first year that we felt far away enough from the pandemic to be able to move on with a sense of normality.

As a result, the gift card market had another successful year following the massive surge it experienced back in 2020 when consumers were using gift cards as a way to treat loved ones when we were unable to meet face-to-face. Here is a quick look at the events and themes that defined the gift card industry in 2022.

Cost of living crisis

The topic that dominated press headlines throughout much of 2022 is the cost of living crisis. This is something that is being felt worldwide. With essential outgoings such as fuel costs, energy bills, food and mortgage interest rates rocketing in price, many households are really feeling the financial pinch. So, will this have a negative impact on the gift card market and retail market as a whole? Or is there a hidden opportunity?

Well, in their Cost of Living Crisis report July 2020, the GCVA (Gift Card & Voucher Association) reported that while 23% of people plan to buy fewer gift cards as a result of the cost of living crisis, an equal percentage plan an increase in spending.

This doesn’t necessarily mean that 50% of people are feeling flush right now. When asked, people who planned on increasing their gift card spending said they wanted to avoid wasted spending, lower their overall gift spending, reduce the cost of delivery and avoid the impact of price inflation on physical gifts. With inflation not predicted to come down until mid-2023, we can expect these consumer behaviours to continue feeding into 2023.

B2B rewards market

2022 saw gift cards continue to gain popularity, especially within the B2B employee rewards market. More and more organisations are utilising gift cards as a way to offer immediate rewards to attract and retain their employees. With the pandemic causing many people to seek more value within their job roles, employers are making employee engagement and wellbeing a bigger priority than ever. This is something that reward schemes are playing into.

In fact, in the GCVA’s State of the Nation March 2022 report, research found that 39.5% of consumers had received at least one gift card over the last three years through work rewards or incentives. Not only this, but almost all surveyed gift card managers said that their company offers both B2B and B2C gift card programmes and the B2B side is where most of the activity lies.


What’s new for 2023?

2023 looks to be another strong year for gift cards. The market was estimated at $414bn in 2021 and is projected to reach $640bn or potentially even $1.4 trillion according to Research and Markets, so the upward trajectory is clear.

So, what are the trends and key focus points that we can expect to see in 2023?

A continued sustainability drive

Of course, a focus on sustainability is nothing new. But it’s something that the majority of industries are making a priority in 2023 and beyond. The same can be said for the gift card industry.

Global branded payments leader Blackhawk Network is leading the way by providing more environmentally friendly card products and pledging to convert the majority of its gift cards to eco-friendly, biodegradable and paper-based materials by the end of 2023. In the next year, we predict that we’ll see many retailers continuing their recent trend in reducing and eliminating their plastic PVC gift card products and replacing them with eco-friendly alternatives. In doing so, they will win the loyalty of eco-conscious shoppers.

The continuing shift from physical to digital and rise of B2B

Digital gift cards have really built up momentum over the last ten years in particular. Online shopping habits are at an all-time high, with retail eCommerce sales set to soar from about 5 trillion US dollars to just over 8 trillion dollars by 2026.

The instant gratification of a simple click has conditioned shoppers to become rather impatient. Whether it’s next or same-day delivery or click-and-collect options, we’re simply not used to waiting for our shiny new goods anymore! Digital gift cards offer that instant gratification experience. Last minute birthday present to purchase? Forgetful shoppers can buy a digital gift card online and it can be sent and spent on the very same day.

The ever-improving array of B2B platforms in the employee benefits, rewards and incentives space is continuing to drive new use cases for gift cards to help solve customer acquisition and retention initiatives. This space shows no sign of slowing down, 2023 presents further opportunity for brands to attack.

Increased focus on fraud management and cyber security

GCVA’s State of the Nation March 2022 report also found that security and fraud management remains high on the gift card manager’s agenda. This is an ongoing battle with no end date and evolves constantly as the attack vectors vary almost weekly.

Elder fraud in the US and the UK has become a real problem. It has forced brands to make every possible effort to protect vulnerable customers. While the tactic is especially nasty despite being somewhat low-tech, it has now reached the point where various states in the USA have reacted with legislative vigour. Expect this to continue, as gift card issuers will be forced to spend a lot of time educating customers and lawmakers alike.

Unfortunately, scammers tend to present a whack-a-mole-esque style of problem. As soon as you defeat one type of scam, another one has already popped up elsewhere. But with an increasing array of enhanced tools and services available from industry players including Savvy, these risks can be substantially mitigated.


See your gift card scheme thrive in 2023

What does 2023 look like for your business? Make it your year of success and let Savvy take your gift card programme to the next level. Whether you are looking for integrated gift card processing, end-to-end gift card processing or gift card analytics, we can help.

Savvy has committed to delivering more platform and roadmap enhancements in 2023 than we have ever delivered before. We’re taking some big steps forward. Our new tools and functionality are all aimed at one thing – helping our customers maximise their gift card programmes and win!

2023 can be the year of bringing your programme data to life and using it to drive your business forward, accessing new distribution channels and evolving your gift card programme to be more flexible and agile than ever before. All you need to do is contact us at Savvy.

Maximise your gift card sales this Black Friday 2022

Black Friday is one of the biggest days in our retail calendar and a must for any bargain-seeking shoppers. This year, Black Friday is set to fall on the 25th of November 2022 with its online counterpart Cyber Monday following on the 28th of November and US shoppers are set to spend roughly $158 billion during this time, with UK shoppers estimated to spend £3.95 billion.

A woman in a retail store holding a number of Black Friday shopping bags.

For UK shoppers, spending is set to drop this year compared to 2021’s Black Friday. With the cost of living crisis dominating the press headlines worldwide and tightening purse strings, this drop in spending may not come as a huge surprise. Whilst consumers in the UK still want to shop this Black Friday, they’re looking to get more for their money than ever before.

It’s not the same story globally though. Research has shown that one in five US shoppers plan to increase their Black Friday spending this year, eager to grab the opportunity to shop discounted products in order to maximise value.

So, how can you attract these price-conscious shoppers this Black Friday and maximise your gift card sales? Savvy explains how you can win this spending season.

Gift card purchasing behaviours for Black Friday 2022

You know the score – in order to effectively market your gift card programme and maximise sales, you must first understand your customer and their behaviour. And when it comes to Black Friday shoppers, there are a few different customer types that you can expect to need to cater to.

Early Christmas shoppers

Black Friday has certainly pulled the start date for Christmas shopping forward a week or two. Whilst many people can be found pounding the high street and emptying retail shelves on Christmas Eve, the organised amongst us will be ready and waiting to spend come Black Friday with their gift list in hand.

In fact, 38.1% of people in the UK start their Christmas shopping before November, and 69.8% before the 1st of December. In the US it’s a similar story, with 60% of consumers organised enough to start before December. Plus, with living costs rising, many shoppers this year will be hoping to spread out the cost of their Christmas shopping and make use of discounts while they’re at it.

How to attract early Christmas shoppers

So, what kind of deals are these customers after and how can you put your gift cards at the top of their Christmas list? Simply offering a discount on your gift cards is a great place to start. For instance, if a customer purchases a £50 gift card, they pay just £45. If a customer purchases a £60 gift card, they pay just £52.

By increasing the discounts the higher the gift card value, you encourage a higher spend and give customers more bang for their buck. Set your Finance Director’s mind to rest by ensuring you track every promotional gift card through its redemption lifecycle so they can actually see the resulting customer spend and value that discount offer created. They’ll probably ask you why you didn’t sell more of them!

When marketing your gift card promotions to early Christmas shoppers, focus on the element of choice for the recipient. These are shoppers who are eager to spend time getting their Christmas gifting right. A gift card is a gift that cannot miss the mark. It’s free money in the recipient’s pocket.

For gift-givers that want to ensure a worthwhile gift that won’t be getting returned on Boxing Day, your gift card is the way to go. Gifting unwanted presents can be a real worry. Over a third of shoppers planned to return a gift back in January 2022. Not only is this a worry for gift-givers, but it has a financial impact on retailers and an impact on the planet as shipping items back and forth creates unnecessary greenhouse gases. Gift cards successfully combat this with the level of choice that they offer.

Thrifty shoppers

Of course, it goes without saying that thrifty shoppers aren’t going to let Black Friday pass them by this year without taking advantage of slashed prices. These are the consumers that consider Black Friday shopping a sport. They will spend hours finding the best prices across the internet and in-store for the products that they want. So, with discounts a-plenty across the board, how can you make sure your gift cards stand out amongst the competition?

How to attract thrifty shoppers

Thrifty shoppers may not have gift cards at the forefront of their minds. They may be on a mission to purchase a particular product. Got any best-sellers that you’re expecting to fly off the shelves this Black Friday? Offer a free gift card of a certain value with specific purchases or if a customer spends over a certain amount online or in-store.

Offering gift cards as a promotion rather than a discount may just give you the edge over a competitor with equally competitive deals. It also rewards loyalty and builds a relationship between you and that customer. Plus, with free money in their pocket, that customer is likely to return in the future to make an additional purchase using said gift card.

You should also consider applying terms and conditions on gift cards purchased during Black Friday that stipulate that they can only be spent after Black Friday, or even extending it out until after Christmas. This way, you can be sure that you will regain some value on the spend rather than it being spent during peak sales periods.

If your gift card systems can’t support these types of capabilities, perhaps it’s time to consider better options. Savvy customers are winning when it comes to Black Friday and maximising gift card sales without impacting margins.

Direct cash-adjacent value is often higher impact than variable discounting. Get marketing in advance to capture thrifty shoppers at their research stage and put yourself at the top of their Black Friday hit list. You could even start your Black Friday gift card promotions early to tempt these well-prepped shoppers in before other brands start competing for their business.

Sustainable shoppers

For the sustainable shoppers amongst us, the packaging and delivery emissions that come with the consumer madness of Black Friday can cause heads to start spinning. In today’s consumer landscape, sustainable shoppers are an ever-growing part of any customer base. Every brand should be considering how they can attract these types of consumers, particularly during these peak shopping seasons.

How to attract sustainable shoppers

Digital gift cards offer a sustainable way for these shoppers to enjoy Black Friday sales without compromising on their ethics. Plus, research shows that shoppers prefer to do their Black Friday shopping online, so focusing on the online sale of your gift cards won’t go unnoticed.

With no physical product to handle or have delivered, digital gift cards have no carbon footprint. Not only that, but the level of choice they offer when gifted to a recipient reduces the risk of purchasing something unwanted, in turn reducing product waste.

A 2022 report found that there is a sharp increase in the number of people who have adopted a more sustainable lifestyle in the past 12 months, and this is increasingly seeping into buying habits. Sustainability is no longer a buzzword. It’s an important part of what many consumers are looking for. And these consumers seek to align themselves with brands that share their morals and values. By prioritising sustainability and using this angle to market your gift card programme, you unleash the potential to increase brand loyalty and win the return business of these shoppers for years to come.


Win with Savvy

It’s time to start doing everything possible to prepare your business for Black Friday. This Black Friday and every other day of the year, Savvy customers can utilise our complete gift card programme visibility and in-depth data analytics to help them maximise their gift card sales and understand their customers and their gift card (buying and spending) habits more than ever to ensure success year after year.

You can win with Savvy with our gift card processing and retail data analytics services – the perfect combination to help take your gift card programme to the next level. Want to find out how Savvy can help you to control and reduce costs, grow your revenue and improve your performance? Get in touch to request a callback and let us bring clarity to your gift card programmes.

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