Despite Increased Popularity, Gift Card Spending to Drop
WASHINGTON, D.C -- While more people than ever will be asking for gifts cards this holiday, shoppers’ price-conscious mentality will take a toll on the season’s most-requested present, according to new research from the National Retail Federation (NRF).
NRF’s sixth annual Gift Card Survey, conducted by BIGresearch, found gift card sales will fall nearly 6 percent this holiday season to $24.9 billion, down from $26.3 billion last year. Fewer people plan to purchase gift cards this year (53.5 percent vs. 56.6 percent last year) and gift card shoppers will be spending less overall on the cards ($147.33 vs. $156.24 in 2007), the research showed.
"Since gift cards never go on sale, some price-conscious shoppers will be passing up gift cards in favor of holiday bargains," NRF President and CEO Tracy Mullin said in a statement. "Retailers may need to make minor adjustments to holiday plans as fewer people may be hitting the stores in January to redeem gift cards."
The biggest gift card spenders this year will be men, who will spend an average of $156.98 on the cards, and Americans over age 45, who will spend $168.02, the survey said.
Preliminary gift card research conducted for NRF by BIGresearch found that the main reason shoppers plan to buy fewer gift cards this holiday season is because:
-- They feel the cards are impersonal (22.7 percent);
-- They would rather stretch their dollar by buying merchandise on sale (10.9 percent);
-- They do not want to buy a card with expiration dates or added fees (9.8 percent).
Other respondents say they simply do not know which gift card a person would want (7.7 percent), while a small number of people say that they are worried the gift recipient will lose it (3.9 percent) or that the retailer will go out of business (3.1 percent).
Though gift card spending is expected to decrease, more people than ever will be asking for the cards this holiday season. According to NRF’s first holiday spending survey, released last month, 54.9 percent of consumers would like to receive a gift card, up slightly from 53.8 percent last year. Gift cards will be the most requested gift this year, followed by books, CDs, DVDs, videos or video games, and clothing or accessories.
"Most consumers have been holding back on spending for themselves all year long and would love nothing more than receiving a gift card that would let them buy whatever they want," stated Phil Rist, vice president of strategy for BIGresearch.
The NRF 2008 Holiday Consumer Intentions and Actions Survey is designed to gauge consumer behavior and shopping trends related to the winter holidays. The survey, which polled 8,758 consumers, was conducted for NRF by BIGresearch between Nov. 5 and 11. The consumer poll has a margin of error of plus or minus 1 percent.
The NRF is the world's largest retail trade association, with membership that comprises all retail formats and channels of distribution.
NRF’s sixth annual Gift Card Survey, conducted by BIGresearch, found gift card sales will fall nearly 6 percent this holiday season to $24.9 billion, down from $26.3 billion last year. Fewer people plan to purchase gift cards this year (53.5 percent vs. 56.6 percent last year) and gift card shoppers will be spending less overall on the cards ($147.33 vs. $156.24 in 2007), the research showed.
"Since gift cards never go on sale, some price-conscious shoppers will be passing up gift cards in favor of holiday bargains," NRF President and CEO Tracy Mullin said in a statement. "Retailers may need to make minor adjustments to holiday plans as fewer people may be hitting the stores in January to redeem gift cards."
The biggest gift card spenders this year will be men, who will spend an average of $156.98 on the cards, and Americans over age 45, who will spend $168.02, the survey said.
Preliminary gift card research conducted for NRF by BIGresearch found that the main reason shoppers plan to buy fewer gift cards this holiday season is because:
-- They feel the cards are impersonal (22.7 percent);
-- They would rather stretch their dollar by buying merchandise on sale (10.9 percent);
-- They do not want to buy a card with expiration dates or added fees (9.8 percent).
Other respondents say they simply do not know which gift card a person would want (7.7 percent), while a small number of people say that they are worried the gift recipient will lose it (3.9 percent) or that the retailer will go out of business (3.1 percent).
Though gift card spending is expected to decrease, more people than ever will be asking for the cards this holiday season. According to NRF’s first holiday spending survey, released last month, 54.9 percent of consumers would like to receive a gift card, up slightly from 53.8 percent last year. Gift cards will be the most requested gift this year, followed by books, CDs, DVDs, videos or video games, and clothing or accessories.
"Most consumers have been holding back on spending for themselves all year long and would love nothing more than receiving a gift card that would let them buy whatever they want," stated Phil Rist, vice president of strategy for BIGresearch.
The NRF 2008 Holiday Consumer Intentions and Actions Survey is designed to gauge consumer behavior and shopping trends related to the winter holidays. The survey, which polled 8,758 consumers, was conducted for NRF by BIGresearch between Nov. 5 and 11. The consumer poll has a margin of error of plus or minus 1 percent.
The NRF is the world's largest retail trade association, with membership that comprises all retail formats and channels of distribution.