We often think of in-person gift-card purchases as a spontaneous decision shoppers make while in the checkout line, whether picking up the card for themselves or as a gift or incentive. But it turns out that those who make spontaneous gift card purchases are in the minority. That was among the findings in a new report from prepaid and payment solutions provider InComm, which determined that 73 percent of consumers plan their open-loop gift card (those cards that can be used anywhere the processing brand -- Visa, MasterCard, etc. -- is accepted) purchases in advance, rather than last-minute. Just 16 percent described their open-loop card purchase as "spontaneous" and 11 percent as "a last-minute need."
These open-loop consumers were also found to buy more gift cards than they expected in a three-month period (while the average respondent expected to buy three gift cards in the period, in fact, consumers bought an average of five open-loop gift cards during that time.
The report, titled "Summer 2018 Open-Loop Gift Card Study," drew on the responses of more than 2,500 consumers in two separate online surveys. It found opportunities for upselling, since 28 percent of shoppers said they spend more than the value of their open-loop cards when they visit a store -- 43 percent of whom spend $20 to $50 more.
"These findings reveal that open-loop gift card users are regular and frequent purchasers of these products," said Matt Lanford, senior vice president and general manager of financial services at InComm, in a statement. "Our study goes into further detail on what consumers expect when purchasing and using an open-loop gift card so brands and retailers are empowered with the knowledge they need to create effective gift card programs."
As for what influenced their purchase decision, two-thirds (67 percent) of consumers pointed to factors related to the efficiency of the shopping experience. The top factor cited as important to their decision to buy an open-loop card was convenience (cited by 33 percent of respondents), followed by having a wide range of gift cards available (28 percent) and that the inventory included a specific card (17 percent).
"Consumers want a gift card buying experience that will not disrupt their regular shopping routines," added Lanford. "Retailers should work closely with their partners and prioritize planogramming and merchandising to ensure their stores have a wide range of gift cards in stock that can be easily found by customers."
The complete report can be found here.