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The Anatomy of A Gift Card

With pre-Christmas consumption a fading capitalist memory, it's time for the next big retail season, post-Christmas consumption. If you're like most, you've probably received a handful of gift cards to celebrate the Savior's birth. But did you know why gift cards are such big business? Here are some interesting insights from the inside of Target:


GiftCards are a major traffic driver pre- and post-holiday, since each one sold means at least two trips to the store: one by the giver and one by the recipient. That’s 16 million purchase trips and 18 million redemption trips from November to January.

Here are a few other reasons why GiftCards are an important component of the fifth quarter strategy:


  • One in three GiftCard recipients said they would not have made their purchase at Target had they not received the GiftCard.
  • Nine out of 10 GiftCard recipients spend more than the value of the card upon redemption.
  • More than 78 percent of GiftCards are redeemed within 90 days of purchase—imagine the sales when the 4,000,000 GiftCards sold during December week 3 are redeemed!


Maybe cash isn't such a bad gift after all?

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This page contains a single entry from the blog posted on January 6, 2005 12:49 PM.

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