US Digital Gift Card Market Size Likely to Reach at a CAGR of 14.4% By 2033

As per the current market research conducted by the CMI Team, the US Digital Gift Card Market size is expected to record a CAGR of 14.4% from 2023 to 2032. In 2023, the market size is projected to reach a valuation of USD 130.4 Million. By 2032, the valuation is anticipated to reach USD 438 Million.

U.S. America Digital Gift Card Market: Growth Factors and Dynamics

• Gift Card Incentive Programs: The implementation of gift card incentive programs by businesses fuels the U.S. Digital Gift Card market. These programs, often tied to loyalty schemes or employee rewards, drive increased adoption as consumers appreciate the added value and flexibility offered by digital gift cards.

• E-commerce Surge: The U.S. Digital Gift Card market is propelled by the booming e-commerce sector. As online shopping continues to grow, digital gift cards offer a convenient and versatile gifting solution, contributing significantly to market expansion.

• Contactless Transactions Trend: The increasing preference for contactless transactions has driven the adoption of digital gift cards. Aligned with the broader trend, these cards provide a secure and touch-free way for users to make purchases and exchange gifts.

• Mobile Wallet Integration: Integration with popular mobile wallets and payment apps enhances accessibility and convenience for users. This integration aligns with the rising trend of mobile payments, further driving the demand for digital gift cards in the U.S.

• Personalization and Customization: The demand for personalized gifting experiences is shaping the market. Digital gift cards with customization options, such as personalized messages and designs, resonate well with consumers, adding a personal touch to the gifting process.

• Strategic Partnerships: Strategic collaborations between digital gift card providers and retailers amplify market reach. Partnerships create synergies, expanding the availability and visibility of digital gift cards across various platforms, thus attracting a broader consumer base.

• Tech-Savvy Consumer Base: The U.S. market benefits from a tech-savvy consumer demographic. With a high level of digital literacy and widespread smartphone usage, consumers are more inclined to adopt digital solutions like digital gift cards, further contributing to market growth and innovation.

• Sustainability Initiatives: Growing environmental awareness influences the market as sustainability becomes a key consideration. Digital gift cards, by reducing the need for physical production and delivery, align with eco-friendly practices, attracting environmentally conscious consumers and contributing to the market’s ongoing growth.

U.S. America Digital Gift Card Market: Partnership and Acquisitions

• In 2023, Starbucks intensified its partnerships with tech giants Apple, Microsoft, and Amazon, aiming to double its 75 million Rewards members within five years. Leveraging these collaborations, Starbucks seeks to enhance its customer engagement and loyalty programs by tapping into the vast user bases and technological ecosystems of these industry leaders.

• In 2020, Mastercard responded to the increasing demand for digitally driven financial solutions by expanding its Digital First Card Program. This initiative aims to provide enhanced digital money management solutions, catering to the evolving preferences of consumers seeking convenient and efficient financial services.

Report Scope

U.S. America Digital Gift Card Market: COVID-19 Analysis

The COVID-19 pandemic has had a significant impact on the U.S. America Digital Gift Card Market, with the industry experiencing both positive and negative effects. Here are some of the key impacts:

• Shift to Online Shopping: The pandemic accelerated the shift to online shopping, influencing the U.S. Digital Gift Card market. As physical retail faced restrictions, consumers turned to digital gift cards as a safe and convenient way to make purchases and send gifts.

• Contactless Preference: The preference for contactless transactions increased during the pandemic. Digital gift cards, aligning with this trend, became more popular as users sought touch-free methods for both gifting and redeeming.

• Impact on In-Store Retail: Traditional in-store retail and the sales of physical gift cards were impacted by lockdowns and restrictions, but the U.S. Digital Gift Card market showcased resilience, providing an alternative for consumers.

• Promotional Campaigns and Discounts: Post-COVID, digital gift card providers in the U.S. initiated promotional campaigns and offered discounts to stimulate demand. These incentives encouraged consumers to purchase and gift digital cards, contributing to the market’s recovery.

• Enhanced Personalization and Features: Companies focused on enhancing the personalization features of digital gift cards to make them more appealing. Customizable options, unique designs, and additional features contributed to an improved user experience, driving recovery in the market.

• Strategic Partnerships and Collaborations: Digital gift card providers formed strategic partnerships with retailers and businesses to expand distribution channels and increase visibility. Collaborations aided recovery by reaching a broader audience and creating synergies within the market.

• Diversification of Offerings: To recover from the impact of COVID-19, digital gift card providers diversified their offerings. This included expanding the range of brands and services available on their platforms, providing consumers with a wider selection of options.

• Technology Integration and Innovation: Recovery efforts involved the integration of advanced technologies and innovative features within digital gift card platforms. Leveraging technologies like augmented reality (AR) or incorporating unique digital experiences enhanced the appeal of digital gift cards, attracting consumers and promoting market revival.

In conclusion, the COVID-19 pandemic has had a mixed impact on the U.S. America Digital Gift Card Market, with some challenges and opportunities arising from the pandemic.

List of the prominent players in the US Digital Gift Card Market:

• PayPal Holdings Inc.
• Sephora USA Inc.
• Best Buy Co. Inc.
• Home Depot Inc.
• Amazon com Inc.
• Apple Inc.
• Google LLC
• Starbucks Corporation
• Netflix Inc.
• Spotify Technology S.A.
• Walmart Inc.
• Target Corporation
• eBay Inc.
• Uber Technologies Inc.
• Facebook Inc.
• Others

The US Digital Gift Card Market is segmented as follows:

By Channel

• Brick and Mortar
• Digital

By Application Area

• Consumer Goods
• Health and Wellness
• Restaurants and Bars
• Travel and Tourism
• Media and Entertainment
• Others

By Card Type

• Closed Loop
• Open Loop

By End User

• Retail Establishments
• Corporate Institutions