Birthdays, thank-you’s, Valentine’s Day – people are constantly shopping for gifts for friends, colleagues, and family. Gifts are more than just pleasantries; they are finely-tuned messages which carry a great deal of meaning. Figure out what people want to say, coupled with their motivation behind the gift, and you’ll be able to furnish them with the perfect gift to help them express it.
In order to maximize your year-round revenue via gift sales, we’ve compiled critical insights into gift purchasing habits. These statistics – collected from over two million transactions via the Rise.ai platform and beyond – provide a treasure trove of insights into how people make their buying decisions. In the age of big data, knowledge is the best tool we have to fuel consistent revenue.
People Pay a Premium for the Right Gift
Gift givers have little time to find the perfect present, but when it comes to birthdays, anniversaries, and special occasions, they are deeply concerned about making the right impression. So much so that they are willing to spend more to do it right: the average price of gift product is 13% higher than the regular cart price. The bottom line is that gift-givers spend more, so they are an ideal target market.
And there’s more good news. When a gift hits a responsive chord, the vendor benefits: over a third (34%) of gift receivers return to the store that sold their gift, and 47% of them make another purchase. The average gift order comes to $67, categorizing gift recipients as an entirely new and intensely attractive year-round target market.
Digital Gift Cards Clearly on Top
A majority of adults (57%) say they believe a gift card is the best gift for the person receiving it, and a whopping 93% of consumers will give or receive a gift card this year. But the chances are, it will be a digital gift card, not a physical one. Statistics show that physical cards are growing at a rate of 6%, which is impressive. But it pales in comparison to digital gift cards, which are growing at an astounding 200%.
What’s the secret to their popularity? They convey the perfect combination of thoughtfulness – the giver chooses the gift but leaves room for the personal tastes of the receiver. The recipient receives the type of gift the giver intended, but in a version they like best: flexible.
While the average gift card comes in at a value of $45, that’s not the end of the story. Some 72% of those who received the cards spent more than the value of the card when they redeemed them.
That’s consistent with findings showing that 82% of small to mid-sized online retailers who used digital gift cards saw an increase in sales. Of course, it’s also worth noting that while 90% of gift cards are redeemed within six months of purchase, a massive billion dollars in gifts is never redeemed by the people receiving gifts.
Women are the Givers, and not Just During the Holiday Season
More than 28% of all gift cards were given as birthday presents, and 26.5% were used to say Thank You. That means that over half the gift cards purchased were outside the holiday season.
If you receive a gift card this year, from a professional contact or even your family, chances are high that it came from a woman. Statistics show that 67.6% of purchases are made by women, as opposed to only 32.4% from men.
Even more surprising, the biggest demographic that gives and receives gift cards is the 25-34 group, which accounts for 28.3% of purchases and 26.9% of recipients. The smallest demographic for giving is 18-24 group with only 15.5%, but that was the second highest group of gift receivers, getting no less than 24.7% of total gift purchases (who doesn’t want to spoil their college kid, especially at back-to-school time? And which college kid doesn’t want to select his own dorm furnishings?)
Gift giving on Valentine’s Day is popular with both men and women. But sadly, 86% of women say men gave them the wrong gift, which is most often flowers, candy, or a stuffed animal. These “safe” gifts are increasingly leading to disappointment, so gear up for Valentine’s Day carefully this year, target men to purchase more personal gifts for their loves.
Gifting is a Year-Round Activity
Gifting statistics prove that there is always a birthday, wedding, or graduation on the horizon. Gifting happens year-round and is the quickest and most efficient route to maximize non-holiday season revenue. Gift cards work for any occasion and always reflect well on the giver. You’ll ring up the profits at the (often online) checkout – now, and again when the receiver comes back to the store to redeem and spend.