Unwrapping Gifting Trends: How Consumers Are Shifting Holiday Spend
While inflation rates stayed in check over the summer, the cost of goods remains high. As a result, consumers are looking for creative ways to stretch their dollar so they can budget for the 2023 holiday season.
According to the Q3 2023 Gift Card Gauge from Fiserv, more than one in four U.S. consumers (27 percent) plan to spend more on gift purchases this season compared to last year. While consumers are prepared for higher prices, that doesn’t mean they’ll settle for paying full price. In fact, 28 percent are already taking advantage of discounts and promotions, while another 31 percent are waiting on annual shopping events like Black Friday to make their move.
Conducted in the summer of 2023, the recent survey from Fiserv assesses how consumers are planning to spend, and where gift cards fit throughout the upcoming holiday season. Here are a few takeaways:
Consumers Have Gotten a Jump on Their Peak Season Shopping
In addition to high-priced goods, consumers continue to have supply chain concerns, leading many shoppers to start their peak season shopping earlier than ever. According to the survey, two in five consumers had started their holiday shopping by July, a 25 percent increase from last year at the same time.
Of those shopping early, many are doing so with product availability and cost top of mind. Nearly two-thirds (63 percent) of shoppers said they're purchasing holidays gifts as they find available options, while more than half (54 percent) said they were shopping earlier to spread their spending over time to combat inflation. With consumers also turning to discounts and promotions to get more bang for their buck, many retailers are capitalizing on “shop earlier” trends by launching holiday gift card discounts and promotions earlier in the year.
Gift Card Merchandising is Key
It’s important for retailers looking to market gift card programs to know that over half (56 percent) of consumers say they will purchase gift cards from affiliated brick-and-mortar resellers offering multiple gift card options, and two-thirds of consumers want to buy a gift card directly from the merchant where the gift card will be redeemed.
With that in mind, in-store merchandising is key. When it comes to placement, 46 percent of shoppers expect to find gift cards near the checkout area, which prompts impulse buying, while 36 percent expect gift cards to be housed in their own endcap near the front of the store. Retailers may also want to place greeting cards and gift cards in proximity since 40 percent of consumers will use greeting cards as quick-and-easy gift card wrapping.
Selling Experiential Gift Cards
Pairing two services or items together might prompt shoppers to purchase more diverse types of gift cards, and gift cards for experiences have become particularly popular. Two-thirds of consumers say they're interested or very interested in gift cards featuring multiple companies that create a complete experience. For example, dinner and a movie for a relaxing night out, or a cooking class with wine tasting.
Additionally, when selling gift cards for services reminding purchasers to consider the tip is an opportunity to upsell; 44 percent of consumers say they want to factor in tipping when buying gift cards for a service such as a massage or manicure.
As the holiday season gets into full swing, consumers will increasingly turn to gift cards because of the convenience they present both to gift-givers and recipients. And understanding what consumers expect — flexible gifting options, experiences, and promotions — will help retailers build a gift card program that delights their customers through year end and keeps them coming back in 2024.