by Adam Brault, Senior Vice President, Financial Services, InComm Payments and Board of Directors, American Transaction Processors Coalition
It seems hard to believe that we are entering our eighth month in a COVID-19 restricted lifestyle. Yet here we are with the holidays around the corner and our health and safety still a priority concern for consumers and retailers.
The statistics show that COVID-19 has impacted shopping behavior, and our research indicates some trends likely to carry over for the upcoming holiday season.
Here are some consumer insights from InComm Payments:
- Rise in digital gift cards
Even before the pandemic, we saw, through our sales data, growth on the purchase of digital gift cards. COVID-19 then accelerated purchases by more than 60% in the first two quarters of this calendar year. Gift cards have fast become the safe, simple and convenient way of gift giving, with 30% of consumers expecting to purchase more gift cards this year than in 2019, according to InComm Payments data.
- Gift cards: the #1 most requested gift
Already a year-over-year success, gift cards are the undisputable #1 most requested gift in 2020. They can be sent from far away, used at virtually any retailer in the United States (excluding store-specific gift certificates), and the dollar amount on many cards can be stored in digital wallets for contactless transactions. While shoppers are indeed still being mindful of crowds, our sales data shows that customers are redeeming gift cards both online and in-store almost equally. Gift cards may be considered a safe and thoughtful gift this year based on the convenience for both giver and recipient.
- General Purpose Reloadable cards are also a great option
Holiday shopping sales show an increase in reloadable card purchases and this year is already demonstrating a strong consumer demand for such cards, as consumers look for increased options to engage in cashless transactions in-store and for online shopping.
Same spend, more concern with safety
Drawing from early indicators, we expect that consumers will spend comparably this year in holiday shopping as previous years; however, it is how they will be shopping that will see the most change. With large online shopping holidays having taken place in mid-October and Black Friday looming on the horizon, retailers will need to determine how to meet customer expectations online and for those who may choose to visit in-store. Coming up with an in-store safe experience and solutions for customer convenience, such as buy online, pick up in-store or curbside delivery, are imperative this season.
Customers want to purchase responsibly, spend wisely and shop safely.