Consumers are set to spend significantly more on gift cards this holiday season, according to the annual holiday forecast from branded payments provider Blackhawk Network.
BHN reported consumers plan to spend almost half of their holiday budget on gift cards.
The 2024 forecast emerges from a consumer survey in which respondents said they plan to spend $760 on holiday gifting overall this year, essentially flat as compared to 2023, BHN noted. As they pursue their present purchasing, shoppers will spend 48% of their holiday budget on gift cards, up from 39% in 2023. While shoppers across all generations plan to spend more on gift cards this year, the largest increase is among younger shoppers. Gen Z and Millennial consumers plan to spend 54% of their total holiday budget on gift cards, an increase from 41% last year, according to BHN.
The range of gift-giving occasions involving family, friends, colleagues, teachers and service workers is expanding, BHN observed, particularly among GenZers, who are twice as likely as Baby Boomers to participate in holiday gift exchanges with friends. With more such exchanges on tap, younger generations report planning to purchase 25% more gift cards this year compared to older generations. Younger survey respondents said they plan to purchase a total of 19 gift cards this holiday season, 12 physical and seven digital, while older generations plan to purchase 15 gift cards, nine physical and six digital.
Despite cooling, inflation remains a top concern for consumers, BHN indicated, with 45% saying they plan to change their shopping behaviors to focus on value and deals this holiday season. For many consumers, the stored value they’ve built up in loyalty programs will serve as a digital spending reservoir. GenZ and Millennial consumers intend to boost their spending power through stored value, with 43% planning to pay for holiday gifts with store or credit card points and 26% set to purchase gifts using other kinds of loyalty credits.
“Consumers are kicking off the holiday shopping season earlier each year and tapping into tech and loyalty points to help them check off their lists,” said Jay Jaffin, BHN chief marketing officer. “Also new this year: While consumers look both online and in-store for the best buying options, about one in five surveyed shoppers said they plan to use AI to help with everything from finding the best deals, to comparing products and getting gift ideas.”
