The global Gift Card market is estimated to be valued at US$ 400 billion in 2018 and is expected to exhibit a CAGR of 10% over the forecast period 2019-2027, as highlighted in a new report published by Coherent Market Insights.
A) Market Overview:
Gift cards are prepaid cards that can be used as an alternative to cash for purchasing goods or services in a specific store or chain of stores. They offer convenience and flexibility to the consumers as well as retailers. The increasing trend of gifting cards for various occasions such as birthdays, anniversaries, and festivals is driving the growth of the gift card market. Furthermore, the rising popularity of e-commerce and online shopping platforms has also contributed to the growth of the market.
B) Market Key Trends:
One key trend in the gift card market is the integration of advanced technologies such as mobile apps and digital wallets. This allows consumers to conveniently store and use their gift cards digitally, eliminating the need for physical cards. For example, Starbucks Corporation introduced its mobile app that enables users to store their gift cards digitally and make payments at Starbucks outlets using their smartphones. This trend is expected to further boost the growth of the gift card market.
C) PEST Analysis:
Political: The political environment plays a crucial role in the gift card market. Regulatory policies regarding taxation and consumer protection can impact the usage and redemption of gift cards.
Economic: Economic factors such as disposable income, consumer spending, and economic stability influence the demand for gift cards. During economic downturns, consumers may opt for more cost-effective gifting options, affecting the market growth.
Social: Social factors like cultural practices and gifting traditions vary across different regions and impact the demand for gift cards. For example, in Western countries, gift cards are widely accepted and preferred, while in some Asian countries, traditional gifting methods are still prevalent.
Technological: Technological advancements have transformed the gift card market. The rise of mobile apps, digital wallets, and online platforms has made it easier for consumers to purchase, store, and redeem their gift cards.
D) Key Takeaways:
- The Global Gift Card Market Growth is expected to witness high, exhibiting a CAGR of 10% over the forecast period, due to increasing demand for convenient gifting options.
- Regionally, North America is expected to dominate the gift card market, followed by Europe and Asia Pacific. North America has a well-established retail sector and a higher adoption rate of gift cards.
- 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 players are focusing on strategic partnerships and collaborations to expand their market presence and cater to the growing demand for gift cards.
In conclusion, the global gift card market is witnessing significant growth due to the increasing demand for convenient gifting options. The integration of advanced technologies and the rise of mobile apps and digital wallets are driving the market further. However, the political, economic, social, and technological factors play a significant role in shaping the market’s growth trajectory. With North America leading the market, key players are actively expanding their presence to cater to the growing demand.