The 2024 holiday shopping season is almost in full swing, and many consumers plan to skip the traditional gift this year, opting to give away gift cards instead. As tighter budgets, increased credit card payments, and higher prices apply pressure to shopping habits, many consumers see gift cards as a more affordable, convenient option to spread the holiday cheer.
A new survey, conducted by payment solutions firm Blackhawk Network, found that the average shopper plans to spend roughly 48% of their holiday budget to buy gift cards this year versus only 39% in 2023. Breaking it down by age group, the percentage was higher among Gen Z and millennials, who intend to use 54% of their gift spend on cards, up from 41% last year.
“Our research found that a growing number of people will be leaning on gift cards, actively looking for rewards and leveraging the points and stored value they’ve accumulated in loyalty and reward programs to fuel their holiday shopping,” Blackhawk’s Chief Marketing Officer Jay Jaffin stated in a press release.
The Value of Gift Cards
With near-constant economic challenges in recent years and many Americans still stressed about their current financial situations, gift cards have become “more valuable” than the usual gift. According to a survey by financial technology company Fiserv, many consumers are using gift cards as extra money to pay for everyday expenses like groceries. The company reported that 49% of respondents agreed that gift cards were more valuable to them than traditional gifts.
Technology plays a significant role in the value and convenience of gift cards. Digital wallets make it easy to track gift card balances and earn rewards. Over 80% of the respondents said they would be happy to use a digital wallet to store gift cards if there was an incentive involved, such as another gift card, loyalty points, or early access to promotions.
Both merchants and consumers can benefit from gift cards. Retailers can increase customer foot traffic and retention as well as sales by promoting a rewards program or other incentives to buy a gift card. Consumers get a seamless, hassle-free way to take care of their shopping list and ultimately use any built-up loyalty points on gifts for themselves.Despite financial concerns, consumers are likely to spend more during the 2024 holiday shopping season. Of the Fiserv survey respondents, about 33% plan to spend more this year on gifts, while only 27% said the same thing in 2023.
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