Gift Cards Market - By Type (Closed-loop Gift Cards, Open-loop Gift Cards), By Distribution Channel (Online, Offline), By Form (Virtual, Physical), By Ability to Reload, By Application, By End User & Forecast, 2024 - 2032

Gift Cards Market Size

Gift Cards Market was valued at USD 534.4 billion in 2023 and is estimated to grow at a CAGR of over 20% between 2024 and 2032.

The gift card market is expanding globally due to rising consumer demand for flexible and convenient giving options. Gift cards allow recipients to select their preferred products or services, making them a popular alternative to traditional gifts.

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For instance, in June 2024, Google Wallet partnered with Pine Labs to help manage gift cards within an app. This partnership came nearly three weeks after Google announced the launch of its digital wallet application in India. Through a partnership with Pine Labs, Google Wallet users can store and manage their gift cards within the app. The application will prompt customers to use their gift cards at the point of purchase.

This adaptability is especially appealing in a global market where consumer preferences are diverse and continuously changing. The emergence of e-commerce and digital payment platforms has considerably aided the gift card market growth. The simplicity of acquiring and delivering digital gift cards online corresponds with modern consumer behavior, which stresses ease of use and immediate reward. Significant technological improvements and the widespread use of mobile devices are also driving growth in the worldwide gift card market.

The integration of gift cards with mobile wallets and apps has made it easier for customers to maintain and redeem their cards, improving the user experience and increasing adoption rates. Blockchain technology is emerging as a means of improving the security and transparency of gift card transactions, thereby mitigating fraud and misuse.

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The gift card industry has significant challenges in terms of fraud and security. Fraudulent activities, such as card cloning, illegal access, and phony gift card frauds, can erode customer confidence and cause financial losses for both consumers and businesses. Addressing these concerns necessitates investments in advanced security measures, such as encryption and real-time monitoring, which can be costly and difficult to implement. Without effective security standards, the legitimacy of gift cards might be undermined, thereby preventing consumers and businesses from engaging in the market.

Gift card regulations vary per country, including issue, expiration, and taxation. Companies that operate in different regions must ensure that they follow local laws, which might require significant legal and administrative resources. Noncompliance with these regulations can lead to penalties, legal challenges, and reputational damage. This regulatory complexity can impede market expansion and raise operating expenses, making it challenging for enterprises to scale their gift card products abroad.

Gift Cards Market Trends

Digital and e-gift cards, which are frequently coupled with mobile wallets, provide convenience and rapid delivery, while personalized features such as custom messages and themed graphics make them more enticing. Blockchain technology improves security and reduces fraud, and there is a visible shift toward more sustainable solutions, such as digital cards produced from eco-friendly materials. Additionally, gift cards are increasingly being employed in business incentive programs and customer loyalty schemes. Global availability, allowing numerous currencies and cross-border use, together with the increased popularity of gift cards for virtual experiences and subscription services, are further expanding the market's reach and importance.

In September 2023, in India, the Government-backed Open Network for Digital Commerce (ONDC) introduced the "ONDC Network Gift Card." This network-level gift card can be utilized by companies for corporate gifting and employee engagement in anticipation of the upcoming festive season.

Gift Cards Market Analysis

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Based on type, the market is divided into closed-loop gift cards, and open-loop gift cards. The closed-loop gift cards segment is expected to reach a value over USD 2 trillion by 2032.

• Closed-loop gift cards are typically issued by a specific retailer or group of retailers and are restricted to use within their establishments. This type of gift card promotes customer loyalty and ensures repeat business within the issuing retailer's ecosystem. Customers often purchase closed-loop gift cards for convenience and as gifts, providing recipients with the flexibility to choose products or services from a preferred retailer without the need for cash transactions.
   
• The closed-loop gift card market's expansion is further propelled by advancements in digital technology, enabling seamless integration of gift card functionalities into mobile apps and online platforms. This enhances accessibility and ease of use for both consumers and retailers, fostering a robust ecosystem for gift card transactions.

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Based on distribution channel, the market is divided into online, and offline. The online segment dominated and is expected to grow at a rate of over CAGR 25% during the forecast period.

• Online platforms offer unparalleled convenience for purchasing and redeeming gift cards. Consumers can browse, select, and send digital gift cards from the comfort of their homes or on-the-go via mobile devices. This convenience aligns with modern lifestyles where digital transactions are preferred for their speed and ease.
   
• The proliferation of e-commerce platforms has streamlined the integration of gift card functionalities. Online retailers can seamlessly incorporate gift cards into their checkout processes, offering customers a versatile gifting option alongside product purchases. This integration boosts sales and enhances customer retention strategies.

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North America dominated the global gift cards market in 2023, accounting for a share of over 30%. High consumer purchasing power and a strong gift-giving culture drive market growth in North America. The region's sophisticated digital infrastructure and broad use of e-commerce platforms make it easier for customers to buy and utilize gift cards. Furthermore, the presence of multiple large stores and technology companies that provide different and enticing gift card possibilities increases market value. Corporate usage of gift cards for staff awards and consumer loyalty programs is also widespread, fueling demand.

Gift cards are a popular choice for a variety of events as Americans value the flexibility and convenience they provide. The U.S. also has a big number of large shops and technology companies that offer a diverse range of gift card possibilities, increasing customer attractiveness. Corporate use of gift cards for staff awards and consumer loyalty programs is widespread, contributing to market growth. Developments in mobile wallet integration and increased security measures further increase the utility and attractiveness of gift cards, cementing the U.S. as a prominent player in the worldwide gift card market.

The China gift card market is expanding rapidly, backed by the country's thriving digital economy and rising consumer buying power. With a large and tech-savvy population, digital gift cards and e-commerce platforms are increasingly popular as convenient gifting solutions. Gift cards are growing popular among Chinese customers for online shopping, leisure, and dining experiences. The integration of mobile payment solutions, such as Alipay and WeChat Pay, has simplified the use of digital gift cards, improving ease and accessibility. The market is also seeing innovations in personalized and themed gift cards to cater to varied customer tastes and events, further fueling growth in China's gift card sector.

In May 2024, InComm Payments, a global payments technology provider, announced the launch of Roblox gift cards at both online and physical retailers in Hong Kong. This introduction marked the first time Roblox gift cards are available for purchase in the Hong Kong market, offering access to the popular online immersive platform where millions of people connect and communicate daily.

The gift cards market in South Korea is quickly developing, owing to the country's sophisticated retail sector and strong smartphone penetration rates. South Korean customers, known for their love of technology and convenience, are adopting digital gift cards as an alternative to traditional gifts. Major retail chains and entertainment venues provide a comprehensive choice of gift card alternatives to attract a wide range of customers. The incorporation of gift cards into mobile payment apps and reward programs improves their attractiveness and usability.

The Japanese gift card business is steadily expanding, driven by a combination of traditional present-giving norms and technology innovations. Japanese consumers love the ease and flexibility of gift cards, especially digital versions that can be purchased and redeemed online or on mobile devices. Major merchants, department stores, and convenience stores all provide a number of gift card options to suit different interests and tastes. The industry is particularly distinguished by the integration of gift cards with reward programs and collaborations with well-known companies, enhancing their appeal as gifts. Despite a preference for cash gifts in traditional settings, the rising popularity of digital payment methods and e-commerce is strengthening the use of gift cards in Japan's developing retail scene.

Gift Cards Market Share

Amazon.com Inc.  hold a significant share of over 40% in the gift cards industry. Amazon's extensive product range and global reach make its gift cards highly versatile and appealing to a wide audience. Consumers can use Amazon gift cards to purchase virtually anything from electronics and apparel to groceries and digital content, enhancing their utility and attractiveness. Amazon's seamless and user-friendly purchase and redemption processes for gift cards contribute to their popularity. The convenience of buying and sending gift cards online, along with flexible delivery options such as email, physical cards, or printable versions, caters to various consumer preferences and occasions. Additionally, businesses frequently purchase Amazon gift cards for employee rewards and promotional campaigns, further boosting their market share.

Gift Cards Market Companies

Major players operating in the gift cards industry are

• Amazon.com Inc.
• American Express Company
• Blackhawk Network
• Fiserv, Inc.
• Givex Corporation
• InComm Payment LLC

Gift Cards Industry News

• In December 2023, Pine Labs' Qwikcilver, a prominent provider of comprehensive gift card and stored value solutions across Southeast Asia and India, teamed up with foodpanda, Asia's largest food and grocery delivery network (excluding China), to introduce foodpanda Gift Cards. This enhanced offering allowed foodpanda customers to conveniently redeem and complete their purchases.

The gift cards market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue (USD Billion) from 2021 to 2032, for the following segments

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Market, By Type

• Closed-loop gift cards
• Open-loop gift cards

Market, By Distribution Channel

• Online
• Offline

Market, By Form

• Virtual
• Physical

Market, By Ability to Reload

• Non-reloadable gift cards
  • Retail gift cards
  • Promotional cards
  • Incentive cards
• Reloadable gift cards
  • General Purpose Reloadable Cards (GPR)
  • Corporate/Business cards
  • Teen and student cards

Market, By Application

• Personal finance
• Marketing & promotions
  • E-commerce
  • Fashion & lifestyle
  • Grocery & supermarket
  • Gaming & entertainment
  • Online streaming
• Hospitality & travel
  • Dining & restaurant
  • Travel & hotel
  • Spa & wellness
• Education
• Non-profit & charity
• Other applications

Market, By End User

• Retail consumers
• Corporate institutions

The above information is provided for the following regions and countries

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia Pacific
  • China
  • India
  • Japan
  • South Korea
  • ANZ
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• MEA
  • UAE
  • Saudi Arabia
  • South Africa
  • Rest of MEA