Gift Card Market to Reach USD 4,656.4 Billion by 2033

Introduction

The Global Gift Card Market is projected to reach approximately USD 4,656.4 billion by 2033, up from USD 920.4 billion in 2023, exhibiting a compound annual growth rate (CAGR) of 17.6% during the forecast period 2024 to 2033.

The gift card market has emerged as a key segment within the global payments and retail ecosystem, driven by evolving consumer preferences, increasing digitalization, and a shift toward cashless transactions. Gift cards are prepaid stored-value cards that can be used for purchases at specific retailers or across multiple platforms, serving as an alternative to cash or credit payments.

The gift card market encompasses a wide range of physical and digital cards offered by businesses, financial institutions, and e-commerce platforms, catering to both consumer and corporate gifting needs. The market’s robust growth trajectory, with a projected CAGR of 17.6% from 2024 to 2033, is largely fueled by the rising adoption of e-gift cards, expansion of online shopping, and integration of AI-driven personalization in gift card offerings.

Increasing corporate adoption for employee incentives and customer loyalty programs is further augmenting demand. Additionally, the growing inclination toward experiential and subscription-based gifting models is reshaping consumer behavior, opening new revenue streams for businesses. Opportunities lie in the expansion of multi-brand and open-loop gift cards, enabling greater flexibility and usability. The integration of blockchain and tokenization technologies to enhance security and reduce fraud is also expected to be a game-changer in the industry.

The rise of mobile wallets and fintech collaborations is further strengthening market penetration, with demand surging across emerging economies where digital payment adoption is accelerating. As businesses innovate their offerings, the gift card market is poised for sustained expansion, driven by a convergence of digital transformation and changing consumer expectations.

Key Takeaways

• The global gift card market was valued at USD 920.4 billion in 2023 and is projected to reach USD 4,656.4 billion by 2033, growing at a CAGR of 17.6%.
• Closed-loop gift cards dominated the card type segment in 2023, driven by strong brand loyalty and high consumer engagement.
• Festive and seasonal occasions represented the largest application segment in 2023, reflecting gift cards’ popularity for celebrations and holidays.
• Retail establishments were the leading end-users in 2023, fueled by significant demand for gifting solutions and incentive programs.
• North America led the market in 2023, accounting for 42.4% of global revenue, supported by high consumer spending levels and ongoing digital transformation initiatives.

Gift Card Statistics

• Approximately 43% of American adults currently have unused gift cards.
• The total value of unused gift cards in the U.S. is estimated at around $23 billion.
• Fraud involving gift cards accounts for 1 in 4 reported fraud cases to the FTC.
• Between 2023 and 2024, the average value of unused gift cards increased by 30.5%, indicating less frequent redemption.
• Expiration is the leading cause for unredeemed gift cards, affecting 29% of holders.
• Around 27% of consumers have lost a gift card at least once.
• 21% experienced a business permanently closing before redeeming their gift cards.
• About 71% of consumers keep gift cards for a year or more.
• Regifting of gift cards occurs among 24% of recipients; 9% choose to resell theirs.
• Higher-income individuals are more likely (55%) to have unused gift cards.
• Only 35% of lower-income individuals report holding unused gift cards.
• A substantial 76% of gift cards are fully used within one month of receipt.
• Gift cards’ flexibility makes them preferred by 72% of holiday gift card purchasers, allowing recipients to select their gifts.
• Ease of purchase and uncertainty about what gift to buy are reasons cited by 41% and 33%, respectively, for choosing gift cards during holidays.
• Gift cards valued below $25 are less popular; fewer than 7% of holiday recipients expect this amount.
• Nearly half (47%) expect holiday gift cards to have at least $25, with 36% anticipating $50 or more.
• Retailer-specific gift cards are favored by 65% of holiday shoppers.
• Holiday-themed designs are preferred by 43% of shoppers; winter scenes attract 24%.
• Gift cards are frequently given for milestones, such as weddings or anniversaries, by 56% of consumers.
• Women use gift cards more frequently (57%) compared to men (43%).
• Flexibility drives 71% of consumers’ preference for gift cards.
• More than half (52%) of consumers buy gift cards for personal use.
• Consumers typically select gift cards averaging around $60 in value.
• Millennials lead in gift card usage (37%), followed by Gen X (28%), Gen Z 18%, and Baby Boomers (17%).
• During the Christmas and holiday seasons, gift cards are used in 64% of transactions.
• Birthdays motivate 43% of gift card purchases.
• Physical gift cards are favored by 54% of consumers over digital options.
• Gift cards positively influence brand loyalty, with 71% of consumers feeling more loyal after receiving one.
• Receiving a gift card prompts 51% of consumers to revisit the issuing store.

Report Scope

Emerging Trends

• Rise of Digital Gift Cards: The increasing adoption of digital payments has led to a significant rise in the popularity of e-gift cards. Consumers appreciate the convenience and immediacy of digital gifting options, aligning with the broader shift towards online shopping and mobile payment solutions. ​
• Personalization and Customization: There is a growing trend towards personalized gift cards, allowing consumers to add custom messages or designs. This enhances the gifting experience by making it more personal and tailored to the recipient’s preferences. ​
• Integration with Mobile Wallets: The integration of gift cards with mobile wallets has improved their accessibility and ease of use. Consumers can now store and manage their gift cards directly on their smartphones, facilitating seamless transactions. ​
• Corporate Adoption for Incentives: Businesses are increasingly utilizing gift cards as part of their employee incentive and customer loyalty programs. This strategy aids in boosting morale and encouraging repeat business. ​
• Focus on Sustainability: Environmental concerns have prompted a shift towards sustainable gift card options, such as digital cards or those made from recyclable materials, reflecting a broader commitment to eco-friendly practices.

Top Use Cases

• Personal Gifting: Gift cards remain a popular choice for personal gifting occasions, offering recipients the flexibility to select items they truly desire. ​
• Employee Rewards: Companies use gift cards to recognize and reward employees, enhancing job satisfaction and motivation. ​
• Customer Loyalty Programs: Businesses incorporate gift cards into loyalty programs to encourage repeat purchases and foster customer retention. ​
• Promotional Tools: Retailers utilize gift cards as promotional tools, attracting new customers and increasing brand awareness. ​
• Budget Management: Consumers use gift cards as a budgeting tool, controlling spending by limiting purchases to the card’s value.

Major Challenges

• Fraud and Security Concerns: The increasing prevalence of gift card fraud poses significant challenges, requiring robust security measures to protect consumers and businesses. ​
• Unredeemed Balances: A substantial amount of gift card value remains unredeemed, leading to consumer dissatisfaction and potential loss of trust. ​
• Limited Expiry Dates: Gift cards with short validity periods can pressure consumers to make hasty purchases, reducing the perceived value of the gift.
• Retailer Insolvency Risks: Holders of gift cards may face losses if the issuing retailer goes out of business before the card is redeemed. ​
• Technological Barriers: Some consumers may face difficulties in adopting digital gift cards due to technological constraints or lack of familiarity with digital platforms.

Top Opportunities

• Expansion into Emerging Markets: There is significant potential for growth in emerging markets where digital payment adoption is on the rise. ​
• Development of Secure Platforms: Investing in advanced security technologies can mitigate fraud risks, enhancing consumer confidence in gift card transactions.
• Corporate Partnerships: Collaborating with businesses to offer gift cards as part of employee rewards and customer loyalty programs can drive market growth. ​
• Innovative Marketing Strategies: Utilizing gift cards as marketing tools can boost brand visibility and attract new customers. ​
• Integration with Emerging Technologies: Incorporating technologies like artificial intelligence and blockchain can enhance personalization and security in the gift card market.

Key Player Analysis

In 2024, key players such as Amazon.com, Inc. and Apple Inc. are anticipated to dominate the global gift card market, driven primarily by extensive digital outreach and user-friendly platforms that enhance consumer convenience. Starbucks Corporation continues to leverage brand loyalty through its successful rewards program, significantly strengthening its market position. Google LLC and Microsoft Corporation are expected to maintain steady growth by integrating gift cards with digital services and gaming platforms, appealing particularly to younger demographics. Retail giants such as Walmart Inc.,

Target Corporation, and Costco Wholesale Corporation benefit from strong physical and digital presences, attracting diverse customer segments by offering versatile gifting options. Best Buy Co., Inc. and Home Depot, Inc. leverage specialized product offerings to sustain consumer interest, particularly among tech enthusiasts and home improvement shoppers. Collectively, these companies contribute substantially to market expansion, driven by strategic digital enhancements, diversified product portfolios, and ongoing improvements in consumer engagement practices.

Top Key Players in the Market

• Amazon.com, Inc.
• Starbucks Corporation
• Apple Inc.
• Google LLC
• Microsoft Corporation
• Target Corporation
• Walmart Inc.
• Best Buy Co., Inc.
• Home Depot, Inc.
• Costco Wholesale Corporation

Regional Analysis

North America Leads Gift Card Market with Largest Market Share of 42.4%

North America dominates the global gift card market, accounting for the largest market share of approximately 42.4% in 2024. This regional dominance can be attributed to strong consumer spending, widespread adoption of digital payment methods, and increased popularity of gift cards during festive seasons and special occasions.

In terms of value, the gift card market in North America is projected to reach USD 390.25 billion in 2024, driven primarily by the United States, where gift cards remain one of the most preferred gifting solutions. Additionally, the high penetration of e-commerce platforms and innovative promotional strategies employed by major retailers further bolster market growth across the region.

Recent Developments

• In 2023, Snappy acquired Covver, a startup specializing in corporate gifting. This move aimed to expand Snappy’s position in the rapidly growing corporate gift market, responding to increased demand from companies wanting cost-effective ways to build strong connections with customers and employees.
• In May 2024, Pine Labs partnered with Google to introduce Google’s Wallet app in India. Pine Labs highlighted that the integration of digital Gift Cards into the Google Wallet app addresses the preferences of young Indian consumers who value choice and flexibility. The company sees e-gifting becoming increasingly important for building customer loyalty and engagement, particularly through refund processes, promotional deals, and credit notes.
• In 2023, ONDC launched a new corporate gift card called the “ONDC Network Gift Card,” supported by the Rupay Network. Companies can issue these gift cards through partners like YES Bank and Omni Card. Unlike traditional gift cards that limit users to specific stores or brands, ONDC’s cards allow recipients to purchase products from various sellers and platforms, offering greater flexibility during festive gifting seasons.

Conclusion

​The global gift card market is on a robust growth trajectory, propelled by increasing consumer demand for convenient gifting options and the widespread adoption of digital payment solutions. Projections indicate that the market will continue to expand significantly in the coming years, driven by factors such as the integration of gift cards into corporate incentive programs and the rising popularity of e-commerce platforms. Technological advancements, including the incorporation of artificial intelligence and blockchain, are enhancing personalization and security in gift card offerings, thereby attracting a broader consumer base. Additionally, the shift towards digital and e-gift cards aligns with the global trend of cashless transactions, further solidifying the market’s expansion. As businesses and consumers increasingly recognize the versatility and practicality of gift cards, the industry is poised for sustained growth, offering ample opportunities for innovation and diversification.​

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