Retail Gift Cards Rebound in 2014 (July 7, 2015)
After a sluggish 2012 and a double-digit drop in 2013, total dollars loaded onto retailer-issued, closed-loop prepaid cards rebounded with a 13 percent increase last year, according to Mercator Advisory Group’s latest report.
Dollars loaded onto retail gift cards jumped to $135.5 billion last year, compared with $120.4 billion in 2013. Mercator measured loads in four segments: employee and partner incentives, consumer incentives, in-store gift and store returns. The growth in 2014 seems to be driven by an increased use of gift cards for consumer incentives and a push by retailers to do more marketing of their cards, according Ben Jackson, director of Mercator’s prepaid advisory service and author of the report. The growth in distribution channels, including digital channels, such as online and mobile, also might have contributed to the growth in card loads, he adds.
“Both consumers and retailers have changed the way they view gift cards,” Jackson tells Paybefore. “Now cards are loaded for gifts, self-use, rewards and even for budgeting reasons. So, the closed-loop prepaid card has become a spending tool that has a place in some shoppers’ wallets—or on their phones—that’s up there with their credit and debit cards.”