Meijer: Gift Cards Go Toward Necessities

GRAND RAPIDS, Mich. As economic concerns grow, consumers getting gift cards this holiday season are more likely than ever to use them for needs such as gasoline and groceries, rather than gifts for themselves, according to gift card redemption data from grocer Meijer.

"We saw this trend begin earlier this year when gasoline prices spiked," said Rob Fleener, VP of marketing for Meijer. "In a tough economy, many consumers who receive gift cards are choosing to use them for items they really need, rather than splurging on a gift for themselves."

While gift card sales industry-wide have generally remained flat, many consumers are shifting their gift card purchases away from specialty retailers toward retailers that offer a broader number of items. This trend is most evident at retailers such as Meijer, which sells groceries and gasoline as well as toys and apparel.

According to a study released last week by America's Research Group and UBS, fewer people are buying gift cards. The study indicated about 44% of shoppers are not buying gift cards this year, compared with 26% last year and about 27% in 2006. However, so far this holiday season, gift card sales at Meijer have been on the increase, bucking the national trend.

"This increase for Meijer is clearly based on the flexibility of a Meijer gift card and the ability to purchase a variety of items with the card," said Fleener. "Just as the use of Meijer gift cards shifted toward gasoline purchases at the peak of gasoline prices last summer, we anticipate a continued increase in the use of gift cards for grocery purchases as economic conditions remain strained."