First Data

New Trends.
New Opportunities.

The 2014 Prepaid Consumer Insights Study

For the thirteenth year in a row, First Data has commissioned a comprehensive study of U.S. consumers regarding gift cards. For the first time, this study not only sought to measure sales of plastic gift cards, but also virtual e-gift cards as well as consumer attitudes and behavior. This valuable research also reveals changes in usage and consumer perceptions by providing comparisons with similar research done in 2013.

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Time to think beyond the mobile tipping point

Over the past year, the widespread adoption of mobile technology has triggered a fundamental shift in how people interact with gift cards. With apps that help people connect with friends, listen to music and find their way home, consumers are relying on their mobile devices in virtually every aspect of their personal and professional lives. And, as this year’s Consumer Insights Study reveals, the same holds true when it comes to purchasing, receiving and managing their gift cards.

Mobile Gyft

3,724 Respondents

Online surveys were nationally distributed to 3,724 U.S. consumers over the age of eighteen

2,371 Respondents

2,371 respondents were screened to have purchased or received closed-loop plastic or virtual cards in the past 12 months

2014 September

Surveys were conducted in September 2014

Data Usage

Data from both surveys was weighted to correspond to census distributions

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Today, retailers have so many new and exciting ways to reach out to consumers so they can:

Reinforce brand messaging
Drive more foot traffic back in store
Offer target rewards
Drive more sales through incentives, loyalty and rewards programs

Why are gift cards more popular than ever? These following six consumer trends tell the story.

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Virtual & Plastic Growth

81% of respondents said they intend to purchase the same, or more, plastic gift cards in 2014 with 20% saying they intend to increase the number of cards. 84% of respondents said they plan to purchase the same or more e-gift cards than last year with 33% said they plan to increase the number of purchases.

Virtual/e-gift Cards

Compared to 2013, how much would you say you are purchasing?

Respondents who purchased e-gift gift cards 511 respondents in 2014
More than last year
About the same as last year
Fewer than last year

Physical Cards

Compared to 2013, how much would you say you are purchasing?

Respondents who purchased physical gift cards 1,089 respondents in 2014
More than last year
About the same as last year
Fewer than last year

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icon Retailers need to utilize all form factors to optimize revenue.

Driving Sales & Foot Traffic

Respondents who receive either a plastic or a virtual gift card said that they spent an average of $23.41 beyond the original value of the gift card. This is an increase from $20.79 in 2012. Additionally, 51% of respondents said that receiving a gift card prompted them to visit a store more often than they would have otherwise.

On average, about how much more did you spend beyond the original value of the single merchant gift card(s) you received in the last 12 months?

In the past 12 months, has receiving a gift card prompted you to visit a store more often than you would have otherwise?

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icon Gift cards are an effective way to drive foot traffic and increase overall spending.

The Era of Online

Compared to 2013, respondents are increasingly choosing to go online to purchase gift cards. Online purchases of gift cards increased substantially from 26% in 2013 to 34% in 2014, while on-premise purchases in store, at restaurant or entertainment locations decreased dramatically from 51% in 2013 to just 44% in 2014. Purchases of gift cards using a social networking site such as Facebook increased from 8% in 2013 to 13% in 2014. The percentage of respondents using an app, a new category, was 13%.

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icon Digital strategies are becoming key to a successful program.

Incentives and Rewards Drive Sales

Incentives, loyalty and rewards drive sales and 32% of respondents noted that even though they were not planning on making a purchase at a particular store, they did so because of an incentive being offered. 40% of respondents said they ended up spending more than originally planned because of an incentive being offered. Respondents also noted that on average they had purchased 2 cards in the past twelve months because of loyalty/rewards points being offered.

Which best describes the influence that incentives or rebates had on your decision to make a purchase, if any at all?

1,217 respondents in 2014

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icon Incentive, loyalty and rewards increase sales and drive purchasing.

Reloading is a BIG Opportunity

68% of respondents have never reloaded a gift card. Respondents reasons for reloading vary. Over 50% who reload make additional purchases using their gift card. Additional reasons include earning loyalty or rewards and to receiving a discount. Budgeting and money management continue to be strong reasons to reload as well as the convenience of not having to carry cash.

Why do you reload?

1,190 respondents in 2014

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Reloading is a BIG Opportunity

68% of respondents have never reloaded a gift card. Respondents reasons for reloading vary. Over 50% who reload make additional purchases using their gift card. Additional reasons include earning loyalty or rewards and to receiving a discount. Budgeting and money management continue to be strong reasons to reload as well as the convenience of not having to carry cash.

Why do you reload?

1,190 respondents in 2014
  • To receive a discount
  • To make additional purchases
  • Loyalty/Rewards
  • Budgeting/Money Management
  • Don't carry cash

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icon Education is the key to increasing reload amount and frequency.

Gift Card Apps Come of Age

As mobile technology continues to blur the lines between our business and social lives, consumers are becoming increasingly more reliant on their mobile devices. In fact, 55% of consumers said they are interested in using an app to store their gift card information on their mobile phones, which is up from 51% in 2013. 58% of respondents said they would prefer to use one app to store multiple merchant cards rather than using separate apps for each merchant.

How would you prefer to store gift cards on your mobile device?

1,322 respondents in 2014

Said they want to use one app to store gift cards from multiple merchants

Are you interested in using a mobile app to store your gift card information?

2,414 respondents in 2014

Said Yes.

icon Mobile apps are mandatory to a successful gift card strategy.

The Time to Evolve Your Gift Card Strategy is Now

Given the proven effectiveness of gift card programs and their proven ability to attract new customers, build brand awareness and drive incremental revenue driving incremental revenue, it’s no surprise that most merchants have robust prepaid programs in place. In order to maximize the success of these programs, merchants must continue to innovate and evolve their efficacy to keep pace with consumer trends and new technologies.

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