National Gift Card Corp. (NGC), a B2B gift card solution partner with more than 450 gift card options for use in the U.S., Canada and Europe, released its mid-year gift card redemption statistics for U.S.-based loyalty programs.
• Nearly three-quarters of all gift card redemptions in loyalty and rewards programs come from just three categories:
◦ Big Box retailers (29 percent). In fact, just eight national retailers account for over 1 out of 4 gift cards redeemed through loyalty programs.
◦ Open Loop reward cards, such as VISA and American Express (23 percent)
◦ Entertainment gift cards, such as iTunes, GameStop, Regal Theaters, etc. (10 percent)
• Gift cards in the Home Improvement (6 percent), Casual Dining (6 percent) and Department Store categories (5 percent) occupy the redemption middle ground. Casual Dining, as a category, accounted for 40 individual brands.
• The lowest gift card redemption in B2B programs occurs in the Sports & Wellness (1.5 percent), Grocery/Pharmacy (1 percent), and Travel (0.5 percent) categories.
• Closed Loop gift cards (cards that may be spent at a specific retailer) outpace Open Loop gift cards 4 to 1.
In addition to the standard category statistics on gift card redemptions in B2B programs, NGC reports that the majority of U.S. participants who earn a reward from their employer or loyalty program choose to receive a physical gift verses a digital one (87 percent select physical cards over digital when given the choice).
While physical gift cards will continue to serve as the foundation of traditional loyalty programs with a mixed aged demographic, Thiegs shared that digital gift card redemptions are increasing by double digits in programs utilizing NGC’s gift card API where there is a need for the end recipient to receive their gift card in real time after they redeem their points, miles, or cash-back rewards.
The above statistics were generated from monitoring the gift card purchases of over thousands of corporate clients in the loyalty, rewards, and incentive markets generating several hundred million dollars in B2B gift card volume in the United States.
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