NRF Recap: The Most Requested Holiday Gift YoY is the Most Underrepresented Topic
Updated: Feb 7, 2020
For the 13th year in a row gift cards were the most requested gift of the holiday season, and the recently released sales numbers only support this claim. 2019 Holiday sales for gift cards increased an estimated 7%; whereas total sales for retailers rose only a reported 3.4%. But somehow, at the NRF Big Show, we only had ONE session touching on the topic in all of the NRF content… let’s say two because I could not make it to everything and the wishful part of me HOPES it came up in another session. By my count there were 187 panels and presentations. That means, if gift card was talked about in 2 sessions, it made up only 1% of the content.
Gift card can be a huge revenue driver for merchants when properly leveraged. On average, they make up 5-10% of revenue (unless you are Starbucks, and then it is a whopping 42%), and even with the one session that talked about gift card, the actual phrase “gift card” did not appear in any session titles or session descriptions. So if I am exploring the idea of a gift card program, and am not familiar with the phrase “branded currency” or “branded payments” I would not have known there was any content for me.
For those new to the term “branded currency” our definition is: anything with brand-specific stored value. Including but not limited to gift cards, prepaid products, loyalty points, coupons, promotional codes and merchandise credits.
But because this is a new term, and new classification of these products and programs, we have to cater to the wider audience that has not encountered our vernacular. We have to help them understand that a great gift card program is not stand alone. It is woven into the customer acquisition and retention strategy. It should be both a product and tool. It should support your loyalty program and it should bolster any promotions you are running to help bring someone back to your brand.
Customers who receive a gift card or buy one for themselves, tend to spend anywhere from $30 - $59 over the value of that gift card. Yet, so many merchants allow this incredibly useful tool to remain anonymous and tied to no real customer data because state escheatment laws are so complicated, that it is just easier to not know anything about the gift card holder.
For us at Flourish Conference and Media, gone are the days of gift card being anonymous. It can’t be anymore. With fraud rates increasing and fraudsters becoming savvier than ever; we have to make gift card more integrated. This is why we started the Flourish Conference 4 years ago. We were sick of spending thousands of dollars on retail, and payments conferences only to have gift card be 1% of the content. A well run and well done gift card program can be the jewel in a merchant’s crown. But it has to be done right, and it has to be a bigger part of the conversation.
We at Flourish are dedicated to helping retailers reimagine this once, one-dimensional tool, and look to the future of branded currency, not just the individual elements that make up branded currency, to say what can a gift card be? What can loyalty mean? How can we make promotions give us better ROI?