Explosive Growth in Gift Cards and the Factors Accelerating This Phenomenon
In the ever-evolving world of retail, digital gift cards are making a significant impact. By 2028, the digital gift card segment is expected to reach a staggering $115.3 billion, according to recent projections.
The digital-first era of gift cards is marked by widespread adoption of digital delivery as a standard, personalized and dynamic gifting experiences, the rise of closed-loop ecosystems, and increased integration with mobile wallets and contactless redemption. This shift is driven by consumer preferences for convenience and immediacy, with approximately 70% of digital gift card sales originating from online shopping and 60% of mobile wallet users preferring e-gifts.
Brands are leveraging digital gift cards strategically to drive customer engagement and business growth. Key strategies include instant digital delivery, personalization, corporate and loyalty programs, and technological advances. Leading brands such as Amazon, Walmart, Apple, Blackhawk Network, and InComm Payments are setting the pace in this digital revolution.
The U.S. gift card market is projected to generate nearly $477 billion in 2025, underscoring the market's strong potential. Digital gift cards are increasingly becoming a strategic tool not just for retail but also for hospitality, services, and corporate sectors, driving higher spending and loyalty without additional operational burden on merchants.
Staples secured the top spot in the Brand's Own Gift Card survey for 2025, followed by Amazon, Best Buy, Sephora, and Target. The survey, which evaluated 100 U.S. merchants across 17 industries, highlighted the importance of gift cards in enhancing customer experiences and driving growth.
As the digital gift card market continues to evolve, merchants are encouraged to adopt best practices such as featuring their digital gift card program prominently on their websites and apps, simplifying the self-use purchase path, and protecting against gift card fraud.
The survey also revealed that consumers are purchasing gift cards year-round, not just during holidays, and that email remains the primary channel for driving engagement, although there is a shift towards other formats for reaching audiences. SMS delivery and direct delivery into merchant apps are growing areas for gift card distribution.
When shopping for others, the average buyer purchases around four gift cards, typically one of which is digital. Interestingly, when buying gift cards for themselves, consumers choose digital formats more frequently. Among the youngest respondents, particularly Gen Z and Gen Alpha, physical stores are the clear favorite for purchasing gift cards.
In conclusion, the 2025 digital gift card market is characterized by digital-first delivery, personalization, mobile wallet integration, and corporate/loyalty adoption. Major brands like Amazon, Walmart, and Apple are leading the way by innovating customer experiences and leveraging technology to boost engagement and growth. The future of gift cards is undeniably digital, offering a convenient, immediate, and personalized shopping experience for consumers.
[1] Source: MarketWatch [2] Source: BusinessWire [3] Source: Forbes [4] Source: CNBC [5] Source: Statista
- In the realm of lifestyle and retail, digital gift cards are increasingly becoming a strategic tool for brands, not only in the retail sector, but also in hospitality, services, and corporate sectors, as they drive higher spending and loyalty without additional operational burden on merchants.
- When shopping for themselves, consumers increasingly prefer digital gift card formats, a trend particularly noticeable among younger generations like Gen Z and Gen Alpha. This preference for digital formats also extends to year-round gift card purchases, suggesting a shift away from traditional, physical gift card buying.
