According to the recent American Express Annual Christmas Survey, the most popular present this year may be the practical gift card. This poses a challenge for retailers, to see who will be able to drive the most consumers to their store.
According to the survey, one in five people will be taking the gift voucher option in 2009, which is up from 13 per cent in 2007. Australian National Retailers Association CEO Margy Osmond commented on the results.
“Clearly, it’s fashionable to be practical this Christmas. The humble gift voucher is very popular with the baby boomers (55 to 74) with one in three admitting it will be their gift of choice,” she said.
“Consumer electronics came a close second (19%), followed by toys (14%), clothing (12%), food and wine (10%), CDs, DVDs (8%), books (6%), home wares (5%) and cosmetics and beauty products (4%).”
Geoff Begg, vice president merchant services at American Express, commented on how American Express is directly impacted by gift vouchers over Christmas.
“Australians have always been very good at giving gift vouchers at Christmas time and in November and December we generally see a spike in the conversion of Membership Rewards points into vouchers,” he said. “Between Christmas 2007 and Christmas 2008 there was a 71% increase in the redemption of retail vouchers.”
“For many American Express customers, the Membership Rewards program has become a form of Christmas Club and they accumulate their points throughout the year so they can transform them into grocery vouchers for the Christmas hamper or into gift vouchers for presents.”
Other findings of the survey have show that 35 per cent plan on shopping at department stores, which is in contrast to last year, when the majority chose to shop at general merchandise stores like Target and Big W.
Another highlight of the survey was that 13 per cent of those surveyed expect to spend more than last year this Christmas, while 34 per cent expect to spend less.
“A lot of people snapped their wallets closed and didn’t spend on themselves during the financial crisis. This year Australians are feeling relieved. Unemployment isn’t expected to reach the highs predicted by the Government, and consumer confidence seems to be stronger,” Osmond said.