give them what they want to give

This holiday season the name of the game is convenience. With that inmind, more and more consumers are putting an end to the frenzied shopping thattraditionally accompanies the holiday season. Instead, shoppers are opting forgift cards purchased at the checkout line at local grocery, drug or, yes, conveniencestores.

Gift cards accounted for more than $17 billion in holiday sales in 2004, roughly8% of all holiday retail sales, according to the National Retail Federation.With that news, gift cards promise to once again be the hottest gift trend for2005. The most recent survey from First Data Prepaid Services' ValueLink statesthat 54% of the respondents who purchased gift cards indicated that they havepurchased gift cards for others at Christmas time. Christmas purchases havemore than doubled since ValueLink first began tracking consumer behavior in2001, when the figure was just 23%.

"For the American consumer, gift cards are now planned purchases that havebecome an integral part of our holiday gift giving,"says Ed Labry, presidentof First Data Prepaid Services ("But, just as important, they are a part of our year-round gift giving, generalretail purchase activity, as well as a growing factor in customer incentive,reward and loyalty programs. Why? Convenience, choice, flexibility and successin giving a gift that delights rather than disappoints."

In addition, people are buying and using gift cards from a much more diverselist of retailers, foodservice and entertainment providers than at any timein the past five years. While major retailers continue to enjoy a dominant share(70%) of gift card purchases, restaurants, food stores and entertainmentbasedstores have seen impressive increases in volume. In 2005, restaurants accountedfor 12% of gift card purchases, more than double the 5% reported just two yearsprior. Food stores accounted for another 6% of gift card sales in 2005, whileentertainment-based businesses accounted for 5%, according to First Data's ValueLink.


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