American Express Unveils Gift Cards With A Little Extra

by Judy Warner, Nov 29, 2006, 5:00 AM

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Survey after survey shows gift cards growing in popularity, particularly among younger consumers. Cashing in on that trend is American Express, which yesterday said it will offer personalized lines of gift cards and cheques specifically for kids and teens as well as special occasions, such as weddings and birthdays.

In addition to their custom design, these gift cards and cheques come with another twist--special offers from participating retailers and restaurants--such as free dessert, two games of bowling for the price of one, and discounts of up to 20 percent on purchases.

"Gift cards are more popular than ever, and American Express is constantly looking to make giving and receiving our Gift Card a more enjoyable experience," said Valerie Soranno Keating, president, American Express Travelers Cheques and Prepaid Services. "Our new lines of personalized Gift Cards and our special offers for recipients give people more reasons to give and more reasons to look forward to receiving the American Express Gift Card and Gift Cheque this holiday season."

Meanwhile, consumers are putting gift cards on their holiday wish lists, and plan to spend more than a gift card's value when they redeem, according to the findings of an Accenture survey of 545 consumers in the U.S.

A second larger study by First Data Prepaid Services found that on average American consumers purchased five gift cards in the last year and spent an average of $281 on those cards. Moreover, recipients of those cards spent an average of $39 over the original value of their gift. Data for First Data Prepaid Services 2006 Consumer Insights Survey was based on interviews with 2,013 adult consumers ages 18 and over, who purchased or received a gift card in the past 12 months.

"The results of our study indicate that American consumers understand gift cards, set out to buy them and typically spend more than the initial value of the card when it comes time to redeem them," said Kevin Grieve, president of First Data Prepaid Services.

Other survey findings:

The ability to choose a specific cash amount was cited as highly influential in the purchase decision by 63 percent of the respondents; while the ability to earn reward points for future discounts and free merchandise was cited as highly influential by 44 percent.

18- to 34-year-old consumers who received single-merchant gift cards had the highest average dollar amount of gift cards per year--$239--compared to $172 for the average gift card recipient.

Of those who purchased single-merchant gift cards, 72 percent entered the retail location intending to buy a gift card.

35 percent of consumers who received a gift card that could be used at a variety of stores and establishments used that card at discount stores, while 21 percent selected specialty retail stores.

Heavy gift card purchasers--those who spend more than $200 per year on single-merchant gift cards--purchased an average of 8.4 gift cards in the previous 12 months.

Purchasers under age 44 are more likely to obtain gift cards from discount stores, while those age 65+ are more attracted to gift cards from department stores.

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