Report: Millennials find a new use for retail-specific gift cards

A majority of millennials are purchasing gift cards, but not for the obvious reasons.



According to a new report from analyst firm Mercator Advisory Group, nearly three-in-five young adults said they bought refillable retailer-specific gift cards during the previous year, up from less than half of shoppers who reported making these purchases in the 2015 study. The biggest jump was among 18- to 24-year-olds, which climbed from 44% to 53%; followed by those aged 25 to 34, which increased from 48% to 57%.



Rather than gift these cards to loved ones and friends however, “More prepaid cards being bought for personal use,” Karen Augustine, manager of primary data at Mercator Advisory Group, said in the report, “Consumer and Prepaid: Growing Use, Especially for Retail-Specific Cards.”



One factor spurring this trend is the availability of retailer apps that enable users to store retailer-specific gift cards, as well as utilize offers available through integrated digital loyalty programs. As millennials use more prepaid cards for their own use, “Young adults will continue to lead this mobile revolution, and grow the use of prepaid cards as a money management tool,” she added.