Consumerscope: Gift Cards: Presents for the Retailer and Recipient
The trickiest part of shopping for friends and loved ones during the holiday season is determining what to give them. Many consumers are opting to skip this holiday headache by purchasing gift cards for people on their shopping list, a trend that’s been popular over the past several years. Gift cards are often a source of convenience and practicality for both the holiday shopper and the gift recipient. But there are also advantages for the merchants selling and accepting gift cards this holiday season, apart from the obvious immediate sales revenue.
Gift Card Purchase Expectations
Four in five (79 percent) holiday shoppers expect to buy gift cards this holiday season, a figure that has remained relatively stable over the past couple years. The difference this year is the types of retailers holiday shoppers plan to buy cards from and the products the recipients will redeem them for.
While mass merchants, such as Walmart and Target, continue to be the most popular gift card option among consumers during the holidays (at a 51 percent intent-to-purchase rate), gift cards from electronics stores are also expected to be a popular buy. Almost a third (30 percent) of holiday shoppers anticipate purchasing gift cards from a consumer electronics (CE) store, such as Best Buy or HH Gregg, an increase from 27 percent in 2012.
Content Purchase Expectations
Holiday purchase intent for most CE devices has leveled or decreased slightly compared to 2012. Yet, interest in gifting content and services to use with these CE devices has increased over the past two years. Over half (51 percent) of holiday shoppers expect to buy gift cards or subscriptions that will be used for purchasing some type of CE content such as e-books, digital music, or on-demand movies this holiday season, compared to 50 percent in 2012 and 46 percent in 2011.
Some 28 percent of holiday shoppers expect to buy gift cards/subscriptions that will be used for digital music purchases and 23 percent will buy gift cards for “apps” purchases. Likewise, 28 percent expect to buy gift cards for e-book purchases, a category that saw an eight percentage point jump from the previous year.
Content and CE Attachment Rates
More importantly, CEA’s 2013 Holiday CE Purchase Patterns Study shows a link between holiday purchases of technology products and content-oriented gift cards. Among the 26 percent of holiday shoppers planning to purchase tablets as gifts, two in five (42 percent) also plan on buying gift cards for purchasing “apps,” such as through iTunes or Google Play. Similarly, almost half (46 percent) of holiday shoppers expecting to buy an e-reader (14 percent) also expect to buy a gift cards for e-books.