May 25, 2024
Gift Card Market

The growing Gifting Industry is driving the global Gift Card Market

The gift card industry has seen tremendous growth over the past decade with the increasing popularity of cashless gifting options. Gift cards are a convenient way for people to purchase gifts without worrying about sizing or colors. They can be bought online or in-store and redeemed virtually anywhere credit cards are accepted. Major retailers, restaurants, online stores and service providers offer gift cards to drive additional sales and promote loyalty. The global gift card market comprises a wide variety of closed-loop, open-loop and e-gift cards that can be purchased for various occasions including birthdays, holidays, thank you gifts and more. Popular physical gift card brands include Visa, Mastercard, American Express, Starbucks and Amazon while major e-gift card providers are PayPal, Google Pay and Apple Pay.

The global Gift Card Market is estimated to be valued at US$ 10.70 Bn in 2023 and is expected to exhibit a CAGR of 21.% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:

One of the key trends in the gift card market is the growing demand for digital and mobile gift cards. With the rise of m-commerce and digital payments, people prefer easy options to send gifts digitally. Many retailers allow customers to create and send e-gift cards over email, Facebook, and messaging apps. Mobile gift cards are also gaining traction as they can be loaded onto mobile wallets, sent via text and easily reused. Transition to digital platforms is helping companies reduce fulfilment and distribution costs while providing a seamless gifting experience to customers. Furthermore, the convenience of digital gift cards is encouraging more spontaneous and last-minute gifting throughout the year rather than just on major occasions. Digital gifting has emerged as one of the major drivers of gift card industry growth.

Porter’s Analysis:
Threat of new entrants: The gift card market has moderate threat of new entrants due to established brand loyalty and high initial costs. However, digital platform has lowered entry barriers to some extent.
Bargaining power of buyers: Buyers have high bargaining power due to wide availability of product options and ease of switching. Buyers can choose from various retailers, brands, gift card denominations and payment modes.
Bargaining power of suppliers: Suppliers have moderate bargaining power due to dependence of retailers on brand partnerships. However, established suppliers face threat from alternate suppliers and private labels.
Threat of new substitutes: Substitutes have low threat as gift cards are preferred for their anonymity and versatility in purchases. However, digital currencies are emerging as substitutes for plastic gift cards.
Competitive rivalry: The market has high competitive rivalry due to presence of major players and ease of entry of startups through online platforms. Players compete on dimensions of technology, partnerships, discounts and innovative card designs.

Key Takeaways:
Global Gift Card Market Demand is expected to witness high growth over the forecast period supported by rising preferences of cashless payments and growing influence of e-commerce.
North America currently dominates the market due to high adoption of digital technologies and presence of major players. However, Asia Pacific is expected to grow at the fastest pace owing to rising disposable incomes, expanding middle class and growth of online shopping in countries like China and India.
Key players operating in the gift card market include Walmart Inc., Under Armour, Inc., Givex Corporation, American Express, Target Brands, Inc., Best Buy, Starbucks Coffee Company, PayPal Holdings, Inc., Apple Inc., Sephora USA, Inc., Gyft, Inc., Walgreen Co., TransGate Solutions, AMILON S.R.L., Jigsaw Business Solutions, Diggecard, Pine Labs Private Limited, Alltimeprint.com, Plastek Card Solutions, Inc., Card USA, Inc., Duracard, Blackhawk Network, Tango Card. Inc, Stockpile, Inc., and Huuray A/S among others. Players are focused on enhancing customer experience through innovative digital solutions and customized card designs.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it