The closed-loop, In-Store gift card segment returned to growth 2016 after seeing a decline in 2015. There was a slight decline in the Employee and Partner Incentives segment, reflecting a decrease in spending in certain programs.
Mercator Advisory Group’s new research report, “Retail Gift Card Trends in the United States: 2016 in Review” says no single factor accounts for the renewed growth of the gift card market, Mercator believes e-commerce has likely played a role. Prepaid cards offer a source of good funds that can be sold and redeemed in every channel. They also offer a way to connect immediate value with customers and prospects through loyalty and incentives programs. These factors likely influenced gift card trends positively.
Closed-loop gift cards continue to be popular for retailers and their customers. The closed-loop gift card market has opportunities to continue to grow as retailers learn new ways to make use of their branded currencies in omnichannel commerce.
Mercator also notes there was a slight decline in the Employee and Partner Incentives segment, reflecting a decrease in spending in certain programs.
Loads in the Consumer Incentives segment climbed in 2015 as the emphasis seemed to shift in the incentives market.
Gift card trends are influenced by larger trends, and a growth in e-commerce may be helping to fuel the growth of gift card loads as shoppers look to gift cards as branded currency for shopping online.
Reported virtual card load volumes seemed to moderate in 2016, but mobile card loads grew. Reloads as a percentage of total volume have become a significant part of the market.