According to the 2007 U.S. Gift Card Consumer Insights Survey, gift cards continued to gain in popularity in 2007. Nine out of 10 (90 percent) American adults who responded to an online survey purchased or received a gift card in the previous 12 months and six out of 10 (60 percent) did both, according to the survey. This is a significant increase from the previous year ’s findings.

“First Data has been conducting the Consumer Insights Study since 2001 to identify gift card trends, and this year we added a first-of-a-kind segmentation analysis that helps our clients better understand and target consumers, ” said Mark Herrington, president of First Data ’s Prepaid business unit. “In addition to this study, we invest in a variety of other initiatives to help our clients develop and maintain successful gift card programs, including our business and consumer incentive studies, our mystery shopping studies and a gift card marketing best practices guide. ”

Birthdays and Christmas are the two most common occasions to give gift cards. Among gift card purchasers who purchased gift cards that can only be used at one retailer, 68 percent bought at least one gift card as a birthday gift, while 61 percent bought at least one card as a Christmas gift. Other popular occasions include graduations, weddings, Mother ’s Day and Father ’s Day, but “thank you gifts ” and “no special occasion ” are frequently cited as reasons as well.

Consumers are buying more cards, too. The majority of gift card purchasers (88 percent) bought more than one card. On average, consumers who purchased cards that can be used at a single retailer bought five gift cards in the previous 12 months and spent an average $46 on each card. Gift card recipients spent an average of $29 over the original value of the gift card.

The study also indicates that gift cards that can be used at a specific retailer are purchased more frequently than those that can be used at multiple retailers, but more than one in four gift card purchasers (28 percent) chose a gift card that could be used at a variety of stores, restaurants and other retailers.

Top reasons why respondents purchase gift cards include that the receiver can buy what they want (72 percent), followed by the convenience of purchasing (43 percent), flexibility in redeeming a gift card (38 percent), and in general, not knowing what to buy the receiver (33 percent).

Fast facts

• 90 percent of consumers purchased or received a gift card
• 60 percent of consumers both purchased and received a gift card
• 68 percent of gift card purchasers bought a card as a birthday present
• 61 percent of gift card purchasers bought a card as a Christmas present
• 88 percent of gift card purchasers bought more than one card
• Consumers purchased an average of five gift cards that can be used at a single retailer
• Consumers spent an average of $46 on gift cards that can be used at a single retailer
• Recipients spent an average $29 over the original value of the gift card

About the Survey

Data for First Data 2007 U.S. Gift Card Consumer Insights Survey was collected September 18 –25, 2007 by Market Strategies International. The data was weighted to match U.S. census data and consisted of interviews with 2,182 adult consumers 18 years of age or older, who purchased or received a gift card in the past 12 months. The results are statistically valid at the 95 percent confidence level with a margin of error of plus or minus 2 percent.