The Italy gift cards market size was valued at $6.55 billion in 2020, and is projected to reach $18.26 billion by 2028, growing at a CAGR of 13.9% from 2021 to 2028.
A gift card is a stored value card used as an alternative source for money at a particular store or business store for purchases related to goods or services. Gift cards are also known as gift certificates, vouchers, tokens, and others, which are generally issued by a retailer or a bank as a developmental strategy used for promoting businesses, attract new customers, increase brand awareness, reduce fraud, and improve sales. Closed loop gift cards can be used at a selected outlet or group of outlets depending on the issuing authority. The rise in use of e-commerce digital payments/wallets—makes it convenient for consumers to track, manage, and redeem gift cards.
The Italy gift cards market share is expected to exhibit robust growth during the forecast period. The key factors impacting the growth of the market include technological innovation in product offerings, and increase in application areas such as hospitality, banking, and retail stores. In addition, rise in need for advanced promotional strategies, high adoption rate of smart phones, and growth associated with e-commerce industry drives the Italy gift cards market growth. Furthermore, various types of fees associated with card transaction and dearth of security measures as compared to credit or debit cards are the major restraints that hinder the growth of the market. Moreover, increase in popularity of these cards while traveling and increase in demand for digital gift cards from consumers in Italy are expected to boost the market growth in the future. However, each of these factors is anticipated to have a definite impact on the overall market growth during the forecast period.
On the basis of functional attribute, the open-loop card segment dominated the Italy gift cards market share in 2020, and is expected to maintain its dominance in the upcoming years owing to the presence of vast population without a bank account in Italy, which makes the gift card market very lucrative. In addition, it provides better security, efficiency, and flexibility of electronic payments, to transact without a bank account, thus boosting its adoption among consumers and businesses. In addition, the closed-loop card segment is expected to witness highest growth rate in the upcoming years, owing to provide various benefits such as providing an opportunity to business to make money on the products purchased using the gift card, free activation for the user, and others, drive the adoption of closed loop gift cards in Italy.
The retail segment dominated the overall Italy gift cards market share in 2020, This is attributed to continuous addition of innovative and attractive gift cards by retailers, which include three-dimensional, reloadable, voice recordable, and online-redeemable gift cards. Retailers use gift cards not only to increase sales but also to communicate their marketing mix, which drives the growth of the Italy gift cards market revenue in the retail industry. However, the corporate segment is expected to grow at the highest rate during the forecast period, due to the increase in usage of gift cards by corporate institutions as an incentive, rebate, and reward payment options to encourage employees to reach new sales goals or production goals and build customer and partner relationships.
By Functional Attribute
Closed-loop Card is projected as one of the most lucrative segments.
The report focuses on the growth prospects, restraints, and Italy gift cards market analysis. The study provides Porter’s five forces analysis of the Italy gift cards industry to understand the impact of various factors such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers on the Italy gift cards market trends.
By Distribution Channel
Offline is projected as one of the most lucrative segments.
The Italy gift cards market is segmented into functional attribute, distribution channel, product type, end user, age group and application. On the basis of functional attribute, it is classified into open loop gift cards and closed loop gift cards. By distribution channel, the market is bifurcated into offline, and online. By product type, the market is bifurcated into physical gift card and digital gift card. In terms of end user, the market is bifurcated into retail and corporate. As per age group, it is segregated into generation X, generation Z/millennials and baby boomers. On the basis of application, the market is categorized into consumer goods, health & wellness, restaurants & bars, travel & tourism, media & entertainment and others.
By Product Type
Physical Gift Cards is projected as one of the most lucrative segments.
COVID-19 impact analysis
The Italy gifts card market has witnessed significant growth in the past few years; however, due to the outbreak of the COVID-19 pandemic, the market is projected to witness a huge decline in 2020. This is attributed to increase in remote working and social distancing, which creates challenge for gift cards in retail, corporate, any other sector for shopping, travel, and cash flow. All these factors have completely reduced the usage of gift cards, gift vouchers, and others. It has been witnessed that different ways of working are bringing different ways of communicating. This presents a challenge for businesses to ensure that customers who are buying vouchers at this time are bringing instant revenue. For instance in April 16, 2020, Instagram in Italy has now officially announced the addition of its new gift card, food order, and fundraiser tools for stories and profiles, which is expected to provide businesses with another way to generate income during the ongoing crisis. To overcome from these challenges, businesses are approaching toward e-commerce tools, and offer discounts on vouchers, include free “add on” items to vouchers. These reasons are expected to dominate the Italy gift cards market growth during the forecast period.
By End User
Retail is projected as one of the most lucrative segments.
Top impacting factors
Increase in demand for innovative products
Gift cards have become one of the best ways for companies to make money. The ongoing technological innovations in gift cards enable high sales in companies and help them in revenue generation. These gift card innovations benefit companies by making them unique and attractive. For instance, track gift card, which allows its users to buy and give gift cards online and also offer them capabilities to see when those gift cards can be redeemed. It also allows recipients to donate their gift cards to charity, and if a card goes unused after its expiry date, the card giver is not charged for it. For instance, Amilon Srl entered into a partnership with Eataly to extend the sale of its digital gift cards to companies. Such broad innovative offerings focused on customer experience drive the growth of the Italy gift cards market.
By Age Group
Generation X is projected as one of the most lucrative segments.
High adoption of smartphones
Gift cards have become innovative with the rapid evolution of smartphones as the use of modern technology and marketing strategies create different ways for gift card lovers and tech-savvy smartphone users that combine all the services into one convenient package. Thus, increase in adoption of smartphones boosts the growth of the gift cards market by providing many easy solutions to the customers. For instance, Gyft that is available on iOS and Android platforms, is one of the most popular solutions. Users can load their gift cards into the app and use them during shopping. As of September 2018, the penetration of smart phones in Italy is limited to only 58% of the total population. However, over the years, the number of smart phone users is estimated to exceed 43 million, i.e., 69% of the total population. High promotion and loyalty programs associated with gift cards are anticipated to fuel the usage of gift cards among smart phone users, especially among online shoppers.
Consumer Goods is projected as one of the most lucrative segments.
Key Benefits For Stakeholders
- This study includes the Italy gift cards market analysis, trends, and future estimations to determine the imminent investment pockets.
- The report presents information related to key drivers, restraints, and Italy gift cards industry opportunity.
- The Italy gift cards market size is quantitatively analyzed from 2020 to 2028 to highlight the financial competency of the industry.
- Porter’s five forces analysis illustrates the potency of buyers & suppliers in Italy gift cards market.
Italy Gift Cards Market Report Highlights
By FUNCTIONAL ATTRIBUTE
By DISTRIBUTION CHANNEL
By Product Type
By END USER
By AGE GROUP
Key Market Players
EUROSPAR, AMAZON.COM, INC, APPLE INC, Conad, Auchan Holding, EPIPOLI S.P.A, Square, Inc, Esselunga S.p.A, Carrefour Group, PANORAMA
Gift cards are similar to prepaid debit cards; however, these cards are funded in advance and named as stored value cards. The convenience, flexibility, reliability, and security of these cards make them popular among consumers for payments. These cards represent a relatively small but important part of electronic payments. According to Worldpay’s 2019, gift cards contribute 2% of e-commerce and 1% of point of sale (POS) spend in Italy. Furthermore, rapid growth in digital e-commerce provides an opportunity to merchants and issuers to adopt new technologies that provide their customers innovative and seamless payment options. For instance, Epipoli S.P.A., an Italy-based company is continuously working on ways to avoid the disruption in payments and revolutionize the way consumers can pay more conveniently. The gift card market is expected to provide promising growth prospects throughout the forecast period, owing to technological innovation in product offerings, rise in demand for advanced payment solutions, and high adoption of smartphones.
According to CXOs of leading companies, the financial services industry is highly competitive even in times of the economic slowdown. Rise in use of mobile devices, with continuous internet access, supported by numerous innovative technologies and shift toward nontraditional gifting approaches provide a platform for growth of the gift cards market. In addition, rise in preference toward gift cards over cash by corporate organizations to reward their employees, further supplement the market growth. Increase in various digital gift card-related offerings further boosts the growth of the market.