Ever since being introduced in 1995, digital gifting has evolved greatly, especially in the past decade. This is many thanks to the world of technology we are in. One of the most prominent factors contributing to the gift card market growth is increasing demand for gift cards in different sectors, including the corporate sector.
Let us briefly talk about digital gifting. What are digital gift cards and how do they work? Digital gift cards are gift codes from retailers that are delivered to you via email. Digital gift cards work just like regular gift cards, however with a digital card; a code is emailed to you. Depending on the retailer, you can use this code online and/or in the store.
With the advance of the Internet and Smartphones, people can access e-commerce sites from anywhere. Digital gifting is highly pertinent for any business that strives to keep up with the pace and maintain their market position. Nowadays, consumers of gift card seem to have more confidence in mobile retail and payments. Also, recent gift card survey has it that consumers tend to go for reloadable gift cards over regular gift cards as they can reuse it, of recent. There has been also been a wide growth in the digital gift card space in recent years. The request and sales for digital or plastic gift cards over the paper ones skyrocketed in the past decade. Studies have hinged this on environmental issues as regards plastics. It is also projected physical gift cards may soon be outdated.
‘The growth in e-gifting sales, from $300 million in 2012 to an expected $3 billion this year, supports a healthy trajectory of growth for the market as a whole.’ A gift card survey says.
The e-gifting trend has helped propel continued growth in the gift card market in excess of $140 billion in sales since 2016. E-gifting has topped $10 billion and filled a niche for customers looking to buy and send their gifts to recipients they do not have to meet in person.
In 2020, the adoption of e-Gift cards increased tremendously during the global pandemic; covid-19.
Digital gifting have added a better change to the gift card market, which guarantees flexibility for buyers and recipients. These innovations could pose a threat to the growth of physical card volume, and has had more issuers adjusting their strategies as digital competitors storm the market.
The gift card industry in United States is projected to keep growing over the forecast period and is expected to record a CAGR of 9.2% during 2020-2024. The gift card market in the country will increase from US$ 163,050.7 million in 2019 to reach US$ 221,146.6 million by 2024. This growth is hinged on the rising adoption of gift cards by the millennials, growth of digital gift cards, rising ecommerce, and increasing demand for cryptocurrencies in the USA.
By looking at the growth of the digital gift cards in the all sectors, they have been proven to scale-up sales, as there is an increasing demand in digital gifting.