Digital Gift Card Market Expected to Reach $1499.3 Billion by 2032—Allied Market Research

According to a new report published by Allied Market Research, titled, “Digital Gift Card Market," The digital gift card market was valued at $341.86 billion in 2022, and is estimated to reach $1499.3 billion by 2032, growing at a CAGR of 16.3% from 2023 to 2032.

A digital gift card is an electronically stored-value card that is used instead of cash at a certain retailer or business outlet to make purchases of products and services. Digital gift cards are frequently used in development plans to promote enterprises, raise brand awareness, cut down on fraud, and draw new clients. Thus, these cards are widely used in a variety of industries, including as food & beverage, retail, hospitality, and consumer electronics. Selling digital gift cards for one's own business has the primary benefit of attracting new customers. As their name suggests, digital gift cards are frequently purchased as presents.

Furthermore, due to technological advancements in product offerings, rise in demand for innovative payment options, and surge in use of smartphones, the market for digital gift cards is anticipated to provide promising development prospects throughout the projected period.

Digital gift card, often referred to as gift certificate, gift voucher, and gift token, is issued by a store or bank as a marketing tool used to promote businesses, draw in new clients, raise brand awareness, lower fraud, and boost sales. The demand for digital gift cards is primarily being driven by rapid digitization coupled with surge in adoption of smart devices. Moreover, increase in use of e-gift vouchers for giving distinctive and alluring product offerings is a result of the booming e-commerce industry. In addition, despite geographical and temporal constraints, the desire for convenient and easy gifting methods is increasing due to improvement in standard of living and hectic work schedules.

Furthermore, the key factors that impact the growth of the global digital gift card market is acceptance of smartphones and increase in demand for advanced payment options. However, security issues affect the market growth to some extent. Conversely, increased enthusiasm in revolutionary products is expected to influence the market growth during the forecast period.

Depending on transaction type, the digital gift card market share is dominated by B2C segment. The same segment is expected to be the fastest growing in 2022, owing to the increasing shift toward online shopping and e-commerce. B2C companies have integrated digital gift card functionality into their online platforms, making it easier for customers to purchase and redeem gift cards directly on their websites or mobile apps. This seamless integration enhances the customer experience and encourages gift card usage.

On the basis of region, North America dominated the digital gift card market size in 2022, owing to rise in demand for digital gift cards. Due to rapid digitization and surge in adoption of smart devices, North America has a strong potential for growth. Additionally, the growing e-commerce industry has sparked a rise in the use of digital gift cards to offer distinctive and alluring product offerings.

However, Asia-Pacific is expected to be the fastest growing, owing to the increased demand during the holiday and shopping seasons, the market for digital gift cards has witnessed significant expansion in this area over the last several years. In addition, with rise in digital gift card purchasing at online shops and investments in Al to give personalized digital gift cards, the usage of digital gift cards has increased substantially and is expected to continue in China.

The COVID-19 outbreak has shifted the preference from cash payments to digital payment; thus, the digital gift card market has experienced substantial growth. Furthermore, digital gift cards are readily available, simple to use, and flexible for purchases. In addition, the popularity of digital voucher, particularly among companies, has surged and is anticipated to continue driving growth momentum for the digital gift card sector as governments implemented lockdown to stop the spread of virus.

Furthermore, firms are using digital gift cards more frequently as a perk for their staff and business partners because of the widespread adoption of work-from-home strategies across a variety of industry verticals. Therefore, organizations and corporate entities have significantly shifted toward digitalized gifting models throughout the pandemic crisis to maintain regulatory COVID-19 criteria. Several nations have enforced lockdowns and closures of retail establishments and other physical sites offering utility services in accordance with COVID-19. As a result, customers' preferences have changed with regard to making payments. Thus, it is projected to increase in the volume of best digital gift cards. In addition, consumers are delaying their holiday vacation plans and looking for substitutes for customary get-togethers & gift-giving. In addition, amid the pandemic crisis, issues such as the demand for less expensive gift options and the spike in plans to shop online rather than in stores were the key consumer trends.

Key Findings of the Study

• By channel, the brick and motar segment led the digital gift card market trends in terms of revenue in 2022. 
• By transaction type, the B2C segment led the digital gift card market in terms of revenue in 2022.
• By end user, the retail establishment segment dominated the digital gift card market growth in 2022.
• By region, North America generated the highest revenue in 2022.

The key players profiled in the digital gift card market analysis are Amazon.com, Inc., Apple Inc., Blackhawk Network, Fiserv, Inc., Incomm Payments Llc, Loop Commerce, Inc., NGC US, LLC., Paypal Holdings, Inc., Target Brands, Inc., and Walmart. These players have adopted various strategies to increase their market penetration and strengthen their position in digital gift card industry.