Global Gift Card Market is Estimated to Witness High Growth Owing to Digitalization and Convenience
The global gift card market is estimated to be valued at US$ 400 billion in 2018 and is expected to exhibit a compound annual growth rate (CAGR) of 10% over the forecast period from 2019 to 2027, according to a new report published by Coherent Market Insights.
A) Market Overview:
Gift cards are prepaid payment cards that can be used to make purchases at specific stores or services. They are a popular gifting option as they provide the receiver with the choice to buy products or services of their own preference. Gift cards are available for various industries such as retail, hospitality, and e-commerce. They can be physical cards or digital codes that can be redeemed online. The market for gift cards has experienced significant growth due to the increasing trend of digitalization and the convenience they offer.
B) Market Dynamics:
Two major drivers that are contributing to the growth of the global gift card market are:
1. Increasing adoption of digital gift cards: With the advent of technology, more consumers are opting for digital gift cards over traditional physical cards. Digital gift cards offer instant delivery, easy redemption, and customization options, making them a convenient choice for both consumers and retailers. Additionally, they can be easily integrated into mobile payment apps, enhancing the overall shopping experience.
2. Growing demand for personalized gifting options: Personalization is a key trend in the gifting industry. Gift cards provide the recipient with the freedom to choose their own preferred products or services, making them a popular choice for personalized gifts. Moreover, some companies offer customization options for gift cards, such as personalized messages or designs, further enhancing the gifting experience.
C) SWOT Analysis:
Strengths:
1. Convenient and customizable gifting option
2. Increasing adoption of digital gift cards
Weaknesses:
1. Limited redemption options for some gift cards
2. Vulnerability to fraud and theft
Opportunities:
1. Integration of gift cards into mobile wallets
2. Expansion into emerging markets
Threats:
1. Competition from alternative gifting options
2. Increasing regulations on gift card expiry dates and fees
D) Key Takeaways:
1. The Global Gift Card Market Growth is expected to witness high, exhibiting a CAGR of 10% over the forecast period, due to the increasing adoption of digital gift cards and the growing demand for personalized gifting options.
2. North America is the fastest-growing and dominating region in the gift card market, driven by the high consumer spending and the strong presence of key players in the region.
3. Key players operating in the global gift card market include Apple Inc., Amazon.com Inc., Best Buy Co., Inc., Starbucks Corporation, Target Corporation, and Walmart Stores, Inc. These companies are focusing on digitalization and expanding their range of gift card options to capture a larger market share.
In conclusion, the global gift card market is witnessing high growth due to the increasing adoption of digital gift cards and the demand for personalized gifting options. With the convenience they offer and the ability to integrate into mobile payment apps, gift cards are becoming a preferred choice for both consumers and retailers. To stay competitive, key players in the market are focusing on digitalization and expanding their product offerings. The market is expected to continue to grow at a steady pace, driven by the evolving gifting trends and the increasing digitalization of the retail industry.
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