Survey Examines Awareness, Use Of Gift Cards In Incentive Programs
U.S. businesses spend $24 billion on gift cards annually, reports the Incentive Research Foundation ((IRF) in its study, “A Closer Look at Gift Cards: U.S. Spend, Support, Sourcing, and Services for Gift Card Programs in Corporate Organizations.” The study, drawing from the results of a survey of 300 industry professionals who run incentive or recognition programs for their companies, examines how gift cards are sourced for incentive and recognition programs, how much money is budgeted toward them, what types are being purchased and where opportunities lie for stakeholders.
“While gift cards are the most omnipresent non-cash award in U.S. businesses, the research revealed that one third of reward and recognition buyers have limited or no awareness that there is an entire industry of gift card suppliers and agencies designed to supply a variety of gift cards to incentive programs,” says Melissa Van Dyke, IRF president. “[The study] will be an important resource to raise awareness and convey the benefits of working with gift card industry professionals.”
The survey found that closed-loop cards accepted at one merchant only, like Starbucks, and open-loop cards—prepaid cards usually issued under a major credit card and redeemable anywhere—are the most common types of gift cards purchased, with three quarters of firms using each. The use of e-gift cards—certificates or cards issued by email or other electronic means—is growing, with half of large enterprises and 58 percent of medium-sized businesses using them.
The survey also found that agencies and gift card suppliers are the least commonly used channels for the purchase of gift cards as awards, with retailers and online topping the list. However, it found that for those who use them, agencies and gift card suppliers have the highest buyer satisfaction rating.
For more on the IRF’s findings, click here.