Pre-paid gift cards remain a popular gift, but an Archstone Consulting Report makes clear that even this popular gift is not immune from the economic struggles of 2008 and 2009. As Dave Sievers, Principal and Lead of Consumer Products and Retail Practices at Archstone Consulting states, “Gift cards are still the gift of choice among consumers, but gift card purchases reflect the challenging economic times.” While research indicates that the number of gift cards purchased increased between November and April ’09, the average value of gift cards purchased declined. Consumers used to buy an average of a $52 gift card, but that average fell 11.5% to an average of $46.00. Furthermore, the majority of gift cards purchased are now pre-paid gift cards that can be used for practical things, as opposed to leisure activities or “toys.”
Although some negative press about pre-paid gift cards persist, such as worries about inactivity fees and other surcharges, retailers and companies that issue pre-paid gift cards are working to combat these negative associations and to increase the popularity and usefulness of the cards. For example, Wired Benefits and InComm are currently trying to establish a pre-paid gift card that will cover medical services at large health networks nationwide, and other retailers, including CVS, are allowing the online purchase and delivery of pre-paid gift cards.
With more upcoming changes on the horizon, including new regulations by the Retail Gift Card Association and the Credit Card Accountability, Responsibility and Disclosure Act, the value of gift cards to the consumer should even be increasing further. These new regulations may restrict inactivity fees and change rules regarding expiration dates in order to add value to the consumer’s pre-paid gift card experience. Since gift cards already present a practical way to give a useful present during hard economic times, these changes may help to improve an already good-thing.