First Data’s 2018 Prepaid Consumer Insights Study found that the average consumer is spending $59 more than the original value of their gift card, marking an increase from $21 a year ago.
In a press release, First Data said the report shows a significant lift is being generated from gift card spending. “Business owners continue to have a tremendous opportunity to drive sales, build their brand and increase customer loyalty by investing in a robust gift card program,” said Dom Morea, senior vice president and head of gift solutions at First Data. “Our study shows that gift cards, or branded currency, are not only a potential growth engine for businesses, but are becoming the preferred gift for both purchasers and receivers alike.”
First Data’s study looks at trends in branded currency, giving business owners insight into how gift card solutions can help their business. This year’s study is based on survey data from more than 2,000 U.S. consumers, and aggregates responses across four unique age groups: Linksters (ages 18-23), Socializers (ages 24-37), the MTV Generation (ages 38-53) and Maturists (age 54+).
According to First Data, this marks the fifth year in a row that consumers overspent the amount on their gift cards. They added that the lift was particularly profound when gift cards were purchased for dining, fast casual restaurants and drug stores. Spending beyond the gift card amount is also happening at supermarkets, with consumers spending on average 94 percent more than the original value of the card.
The survey also shows that gift cards are still the preferred gift, with receivers increasingly favoring them over physical presents. Forty-seven percent of Linksters prefer a gift card, while consumers plan to spend 55 percent of their annual gifting budget on gift cards and 33 percent of purchasers will spend more on a gift card they would on a traditional gift.