It comes as no surprise that COVID-19 has resulted in devastating and far-reaching effects on the economy over the last year. State-mandated orders, along with the general uneasiness of crowded, public spaces made it near impossible for businesses to thrive. The one saving grace? E-commerce.
E-commerce has skyrocketed since the onset of pandemic restrictions. This makes sense as online shopping falls under the safe category of “at-home entertainment.” Gift card sales have grown exponentially alongside the e-commerce boom. In fact, gift card sales are projected to grow by $527.11 billion USD between 2020-2024.
Here are some key contributing factors to the gift card industry’s growth and how your business might capitalize from it.
Gifting Culture: A New Trend
A near-instant repercussion of stay-at-home orders across the country last year was the quick social adaptation to life in isolation—namely, how to continue to connect with others from a safe distance.
Long-neglected opportunities to bridge the distance gap quickly became integrated into our daily lives. Technological communication modes, such as Zoom and FaceTime, suddenly became day-to-day necessities. Social events moved to a virtual setting—book clubs, support groups—even playdates for children. It was human adaptation at its best!
Throughout this adjustment period, gift-giving became a basic way to show distant loved ones that their physical presence was missed. As a result, online gift card sales skyrocketed. Gift cards, which may be purchased and spent online, transferred from one person to another without ever physically being touched, and provided obvious health and convenience benefits.
So, how can your business benefit from this shift to virtual socializing? We suggest promoting this gift-giving culture within your business marketing campaign. Remind your customer base via email and social media that virtual gift cards are easy to purchase and a great way to remind a distant loved one that they are cared for! This is a trend we at Card Market hope lives on beyond the pandemic (and the numbers prove this likely).
What the Restaurant Industry Taught Us
No one was forced to adjust to new quarantine orders as swiftly and efficiently as the restaurant industry. Naturally, the food industry took the hardest hit, most suddenly, at the beginning of the pandemic. Entire business models were quickly forced to pivot around curbside and to-go ordering rather than the indoor dining experience.
Gift cards proved invaluable to restaurants, serving as a sort of “micro-loan” for businesses by providing immediate cash flow without having to provide immediate service. Gift cards were further used to their advantage, as many restaurants promoted incentives for customers to purchase gift cards with a higher amount for a slight discount.
Email and social media campaigns also proved crucial to keeping restaurants alive, especially on the local scene. Many small businesses chose to turn to extended merchandise (i.e. mugs and apparel) to boost brand awareness, while also offering loyal customers the opportunity to lend their support—even if they were still uncomfortable with the prospect of eating takeout.
As we are now an entire year into managing life and business in a global pandemic, it is pretty safe to assume we should solidify the changes we’ve made to our businesses and accept that e-commerce will now play a pivotal role in our economic success.
Gift-giving culture should be embraced—for both the joy it provides and the business it brings. Online gift cards will continue to play an essential role in revenue as they are often viewed as a safer way to shop online.
Card Market can help your business thrive in this new business model surrounding e-commerce and gift-giving. Contact us today to schedule a consultation!