Retail Gift Card Trends in the United States: 2015 in Review

  • ID: 3831978
  • Report
  • Region: Global, United States
  • 17 Pages
  • Mercator Advisory Group
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Closed-Loop Gift Card Loads Fell in 2015 as Shoppers Favored Merchandise
The research report, Retail Gift Card Trends in the United States: 2015 in Review, documents the dollars loaded in 2015 onto closed-loop prepaid cards or prepaid account access devices issued by retailers. The double-digit gift card load growth in 2014 was not sustained as retailers focused on convincing shoppers to favor merchandise with discounts and sales.

In the past, the author has published distribution information for prepaid cards as a separate report. The new report includes distribution information along with load information for retailer-issued cards. All the charts and tables in this report represent the average reported percentage of total loads, whether the cards were issued for direct-from-consumer loads or as incentives or other business-to-business purposes.

"Closed-loop gift cards continue to be popular for retailers and their customers, but retailers have steered customers toward buying goods," said Ben Jackson, the Director Prepaid Advisory Service and author of the report. "Despite downward pressure in 2015, the closed-loop gift card market has opportunities to rebound as retailers learn new ways to make use of their branded currencies."

Highlights of the report include:

- -The closed-loop, In-Store gift segment declined in 2015 after seeing near double-digit growth through 2014.

- Issuers reported growth in the Employee and Partner Incentives segment, since that was the only retailer-issued segment that saw growth in 2015.

- Loads in the Consumer Incentives segment declined in 2015 as the emphasis seemed to shift in the incentives market.

- This report also includes information on the distribution channels used by issuers. Retailers continue to see steady load volumes through card malls, business-to-business, and their own websites.

- Reported virtual card load volumes continue to take an increased share of the total dollars loaded onto closed-loop, retailer-issued cards.

- Reloads as a percentage of total volume remain above 10%.
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1. Executive Summary

2. Introduction

3. In-Store Gift Card Loads Fell in 2015

4. Loads in the Winter Holiday Season Declined

5. Store Credit (Returns) Loads

6. Business Time and Expense Category

7. Business Time and Expense Category: Employee and Partner Incentives

8. Business Time and Expense Category: Consumer Incentives

9. Distribution Channels

10. Form Factors: Plastic, Virtual, and Mobile Cards Vie for Attention

11. Card Life: Is It Better for Cards to Have a Long or Short Life?

12. Reloads Remain an Important Customer Engagement Tool

13. Average Card Loads Fell in the Past Year

14. Conclusion: What to Make of the Numbers

15. Endnotes

List of Figures

Figure 1: Taxonomy of Prepaid Cards: 11 Categories, 26 Market Segments
Figure 2: Loads in the In-Store Gift Cards Segment of U.S. Closed-Loop Prepaid Cards Market
Figure 3: Average of In-Store Gift Card Loads During the Holiday Season of November 1 - December 31 in Years 2010-2015
Figure 4: Loads in the Store Credits (Returns) Segment of the U.S. Closed-Loop Prepaid Cards Market
Figure 5: Loads in the Employee and Partner Incentives Segment of the U.S. Closed-Loop Prepaid Cards Market
Figure 6: Loads in the Consumer Incentives Segment of the U.S. Closed-Loop Prepaid Cards Market
Figure 7: The Main Prepaid Distribution Channels

List of Tables

Table 1: Weighted Average Reported Load Volume Percentages Through Distribution Channels
Table 2: Physical Cards Remain the Dominant Form Factor in the U.S., but Use of Virtual Cards Is Growing
Table 3: Average Reported Card Life (in Days) Has Shortened in the Past Year
Table 4: Reloads Can Add to Card Life
Table 5: Reported Average Card Loads Fell in the Past Year
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