Some of the leading players operating in the global gift cards market are Qwikcilver Solutions, InComm, National Gift Card Corp., Gyft, Edge Loyalty Systems Pty Ltd., and Blackhawk Network Holdings, Inc, which are offering open loop gift cards for a variety of needs for various end uses, observes Persistence Market Research (PMR). Several of these players are focused on unveiling innovative services to facilitate businesses in the adoption of gift cards for loyalty, incentive, and reward programs, in a move to stay ahead of others. Other companies at the forefront of the global gift cards market are Wal-mart Stores, Inc., Target Corporation, Starbucks Corporation, and Apple Inc.
A number of players hope to capitalize on vastly emerging opportunities from the advent e-commerce and m-commerce technologies, and entering into retail partnerships, in order to consolidate their presence in major regions. According to PMR, the current valuation global gift cards market exceeds US$307 Bn and is projected to expand at a CAGR of 10.79% from 2016 to 2024. The market is predicted to reach a worth of US$698 Bn by the end of the forecast period.
Based on type of card, the universally-accepted open loop-gift card dominates the global market and the segment is projected to rise at a robust CAGR of 20.7% during the forecast period. The vastly rising demand for these cards, vis-à-vis expected decline in demand for other cards, is attributed to their benefits such as near-universal acceptability across businesses and the versatility of options customers and merchants have with this card. At present, regionally, North America dominates the global market as it held the major share. However, by the end of the assessment period, Asia Pacific (APAC) is anticipated to emerge as the leading market, accounting for around 33% of the global revenue share.
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Flexibility and Versatility of Cash to Offer Compelling Propositions for Business Adoption
The growing demand for gift cards among corporates and businesses at large is a key factor driving the market. The wide acceptance of gift cards among consumers is attributed mainly to the number of benefits these have and the versatile options they offer, notably acting as more compelling as cash benefits. World over, the soaring popularity of gift cards as corporate incentives is a key factor boosting the market. This is driven by the proposition than they are more effective than cash for awarding achievers in organizations, offering the flexibility and versatility of cash, along with the ease of use. Furthermore, their worldwide acceptance is fueled by them acting as a memorable incentive for employees, thereby improving the work compensation.
The wide desirability of gift card programs among businesses, notably among retail stores and special-service businesses, as potential marketing tools helps them in improving brand awareness and attracting new customers, apart from boosting sales. The advent of electronic gift card has substantially reduced the options of fraud, which bodes well for the market.
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Burgeoning e-Commerce to Provide Robust Fillip
The demand for closed loop gift cards of various types is expected to witness a decline in the coming years, which is a key constraint likely to hamper the growth of the overall market. On the other hand, the rising popularity of open gift cards, largely on the account of universal acceptability, is a key factor expected to accentuate the worldwide market. A burgeoning retail sector, especially organized retail market, in a number of emerging economies in developing regions, notably APAC, is a prominent trend bolstering the demand for gift cards. The cropping of retail stores and supermarkets in these regions has further stoked the demand. The ease-of-shopping brought about the wide popularity of m-commerce, coupled with the cheaper availability of internet plans, and the proliferation of mobile apps are crucial factors catalyzing the growth of various regional markets.
The advent on innovative features in gift cards is a key factor that is anticipated to unlock exciting opportunities for market players in various regions. The rise in discretionary spending on shopping across a burgeoning middle class of populations in various developing regions is a key trend accentuating the overall market. The recent introduction of gift cards in lottery games has enhanced the flexibility and offered the combined benefits of entertainment and convenience, thereby revving up revenue and reaching new customers. This is a prominent trend observed in North America gift card market.