‘All I Want for Christmas is a Gift Card,’ Say Consumers in Accenture Survey
Almost Half of Recipients Use Cards within a Month and Spend More Than Card’s Value
NEW YORK; Nov. 14, 2005 – Shoppers short on ideas for holiday presents are choosing gift cards to solve their shopping dilemmas, according to results of a recent Accenture survey of more than 500 U.S. consumers.
More than two-thirds (68 percent) of respondents said they bought gift cards because they did not know what their friends and family wanted. Fortunately, 42 percent of respondents said they would prefer getting a gift card over a gift, and an additional 26 percent said they had no preference for one over the other.
When redeeming gift cards, 56 percent of respondents said they treat themselves to something they would not normally buy, and 38 percent said they buy something for which they were saving. When shopping with a gift card, almost half (45 percent) of respondents said they spend more than the face value of the card.
The survey also found that three-quarters (75 percent) of respondents said they spend the same amount when giving a gift card as they would on a gift, while nearly one in five (17 percent) said they spend more on a gift card than they would on a gift.
“Gift cards are changing how consumers shop, which is a significant opportunity for retailers to increase their share of the customer’s wallet,” said Janet Hoffman, Managing Partner, Accenture’s North American Retail practice. “Customers with gift cards may not be as bargain-driven as the typical after-holiday shopper, so retailers should consider changing product assortments and promotions to better serve consumers eager to indulge in special items.”
The majority (82 percent) of survey respondents said they have either given or received a gift card, and Christmas and birthdays are equally popular occasions for giving them. In fact, 64 percent of respondents reported they have given cards as Christmas gifts, and the same number said they have chosen the cards for birthday gifts.
Shoppers choose cards in a variety of categories, but most frequently in: apparel; entertainment, including music, books and movies; and food, which includes grocery stores and restaurants. In addition, almost half (49 percent) of respondents said they give the cards because they are more convenient to buy than gifts, while 38 percent said they buy gift cards because they are more convenient to send than gifts.
Merchants may notice that gift-card spending influences store traffic and purchase behavior in the post-holiday period. For instance, 44 percent of respondents said they spend their gift cards within one month of receiving them, and another 38 percent said they spend their gift cards within three months. Most respondents (86 percent) go to a store to purchase the cards, and the vast majority (94 percent) spend the cards in a physical store rather than online.
“Because shoppers overwhelmingly go to stores to buy and redeem gift cards, retailers should capitalize on these shopping trips to appeal to new customers, improve loyalty among current shoppers and increase basket size,” noted Hoffman.
Other key findings of the survey include:
- The gift card category has room to grow. Most respondents give and/or receive only one to three gift cards per year, yet more than 40 percent said they prefer a gift card over a gift.
- Entertainment cards appeal to higher incomes. Respondents with the highest income levels ($76K to $100K and more than $100K) buy more gift cards in the entertainment category than respondents in other income levels.
- Most cards spent in single visit. Two-thirds (66 percent) of respondents said they would use a card in one store visit, while 32 percent said it would take two or three visits to use a card.
- The majority of gift cards purchased are for $50 or less. Eighty-one percent of respondents purchased gift cards for amounts between $11 and $50. Just 12 percent spent $51 or more, and 6 percent spent $10 or less.
The Web-based survey of 513 U.S. consumers was fielded in September and October 2005.
Accenture is a global management consulting, technology services and outsourcing company. Committed to delivering innovation, Accenture collaborates with its clients to help them become high-performance businesses and governments. With deep industry and business process expertise, broad global resources and a proven track record, Accenture can mobilize the right people, skills, and technologies to help clients improve their performance. With more than 123,000 people in 48 countries, the company generated net revenues of US $15.55 billion for the fiscal year ended Aug. 31, 2005. Its home page is www.accenture.com.
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