Despite a backdrop of inflation and rising living costs, new research reveals a strong performance in the gift card and voucher industry through the second half of 2022.
The latest analysis by the Gift Card and Voucher Association (GCVA) and KPMG UK found that retail continues to dominate the market (accounting for 90%), with GCVA retail members experiencing a median 10.4% increase in sales.
Grocery was the highest retail growth area with 11.8% like-for-like growth overall – potentially the impact of consumers seeking discounts through gift cards to help combat the cost of living.
In contrast, fashion appeared to be a tightening market for discretionary spend, seeing a 7.8% like-for-like decline.
However, it was the leisure market that led the way for the third period running, experiencing like-for-like growth of 7.6% and showing a continued appetite for experience-led gifting, as Brits prioritise leisure and entertainment activities when money is tight. Leisure gift card sales grew by 28% in 2022, compared to the previous year, as the nation continued to pull away from the effects of pandemic restrictions.
The findings demonstrate robust consumer confidence despite the economic climate, with B2C sales growing by 13% through 2022. Sales increased across every channel, with in-store accounting for over 58%, and gift card malls experiencing 20.5% like-for-like growth, showing the continued strong role of the high street in driving the gift card and voucher market.
Within B2B, rewards and incentives grew by 44.6%, reflecting a shift in how businesses are using gift cards to reward their staff. Employee benefits retained the biggest market share (55%) but showed a small decline from the previous period as the pandemic-induced staff benefit boost begins to moderate.
Digital products have contributed significantly, showing 19.3% growth on the previous year. The shift away from physical cards and paper voucher continues as people look to digital as a quick, easy and more sustainable method to purchase.