Online Gift Card Sales Soar As Pandemic Restrictions Send Consumers to Their Laptops

The pandemic has sparked a huge lift in online gift card sales as consumers make shopping for the plastic part of their e-commerce routine. The number of cards purchased online soared 57% in the first six months of this year compared to the first half of 2019. Some 52% of consumers reported buying a gift card online in the first half of the year, up from 41% who said they did so in 2019 and 33% in 2018. 

That’s according to survey data released Wednesday by Atlanta-based payments processor InComm, whose payment technologies include support for gift card malls. The report’s information was derived from responses generated from more than 16,000 consumers.

The surge in purchases of gift cards online this year was especially evident with so-called open-loop cards, which usually bear a network brand and are generally redeemable at stores and restaurants. Here, the number of cards purchased online was fully 77% greater than in the first two quarters of last year. For closed-loop cards, the increase was 43.5%.

Purchases of digital cards, meanwhile, jumped 61% in the first half compared to the first six months of 2019, according to the report, entitled “2020 Consumer Pulse: Gift Cards.”

“We have monitored a steady growth in online gift card purchases over the last few years, but the rapid increase of online purchases during the first half of this year has been remarkable,” said Brian Parlotto, executive vice president at InComm, in a statement. “The suddenness of the increase is largely the result of the pandemic’s effects on in-person shopping, but this trend is supported by data showing that consumers are increasingly purchasing gift cards for digital content such as gaming and streaming services.”

Given consumers’ turn to e-commerce during the pandemic, it’s not surprising they are redeeming their cards at online shops, which ranked as the top category for both open- and closed-loop cards. By contrast, the long-popular dining category slipped to second place for closed-loop redemptions in the first half of the year. The grocery category grew, meanwhile, becoming the second-biggest redemption category for open-loop gift cards.