The incentive gift-card market is a booming business. Some 52% of U.S. businesses that use gift cards spend $22.7 billion a year in the category, according to a new study by the Incentive Research Foundation.
The cards are a hot ticket for use in employee incentive programs with more than 60% of firms reporting that employees are the recipients. Other key recipient groups include salespeople, channel partners and customers.
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* 68% of the market uses open-loop cards, 54% closed-loop, 12% use restricted cards and 14% now use virtual cards.
* Large businesses are more likely to use a card provider that can deliver many different types of cards, while smaller businesses are more likely to go directly to retailers for their cards. Approximately one-third of U.S. businesses use both card providers and retailers, regardless of the size of the business.
* Most gift-card buyers report that their future spending will either remain the same or increase.
“The economy over the past years has affected many things, but the research confirms that the use of gift cards in business is still very strong,” Betty Weinkle, past president of the IGCC, said.