In its annual holiday forecast, payments provider Blackhawk Network stated that spending on the festive season will gain a modest 3%, with gift cards getting a more significant piece of the holiday pie.
According to Blackhawk, consumers will spend 43% of their holiday budget on gift cards in 2023, up from 37% from a year earlier, with load values expected to increase this year.
The forecast also suggested that younger shoppers will drive noticeable shifts in holiday shopping behaviors and that consumers haven’t started their holiday shopping as early as they did in 2022, with many planning to wait until the last weeks of December this year.
Surveyed consumers intend to spend $770 on holiday gifting overall this year, translating into a relatively flat 3% increase over 2022, BHN maintained. Younger generations plan to purchase a total of 17 gift cards this holiday season, ten physical and seven digital. Older generations plan to purchase ten gift cards, seven physical and three digital.
Younger generations surveyed plan to buy 70% more gift cards than older generations this holiday season, BHN indicated. Surveyed Gen Z consumers plan to spend 56% more on gift cards and 9% more on gifting overall year over year. In addition, younger generations plan to use secondary payment types much more often than older generations, BHN pointed out. Although debit, cash and credit cards remain the top three payment options among all generations surveyed, many younger shoppers surveyed will also look to store or credit card points, at 43%, mobile wallets, at 39%, and physical gift cards, at 37%, to pay for holiday gifts this year.
Regarding later-season shopping trends, BHN’s research demonstrated that younger consumers are a reason for the trend, especially Gen Z, with 72% of the cohort planning to begin shopping in November and December.
“Our research found that after a year of economic ups and downs, consumers are still planning to spend on holiday, but overall gift spending will remain relatively flat as 96% of consumers report ongoing concerns about cost-of-living pressures,” said Jay Jaffin, chief marketing officer, BHN, in announcing the survey results. “Consumers will once again look to gift cards to make the most out of gifting, with shoppers planning to spend nearly half of overall gifting budgets on gift cards, a trend largely driven by younger consumers. For retailers, as the youngest generation of shoppers continues to wield their influence and spending power this holiday season, it has become vital to expand and optimize marketing and gift card programs to include new ways to attract and engage young consumers.”
