First Data's 18th Annual Prepaid Consumer Insights Study Shows Growth Trends in Branded Currency

Study finds that consumers, on average, spend $59 over the original value of the gift card they receive

Results show that consumers plan to spend 55% of their annual gifting budget on gift cards

The average consumer is spending $59 more than the original value of their gift card, up $21 from 2017, according to the 2018 Prepaid Consumer Insights Study released by First Data (NYSE:FDC) today. The report shows significant lift is being generated from gift card spend and continues to highlight a year-over-year branded currency growth trend; for the fifth consecutive year, when purchasing with a gift card, consumer overspend has increased.

First Data's 18^th Prepaid Consumer Insights Study looks at trends in branded currency, giving business owners insight into how gift card solutions can be a boon for their business. This year's study is based on survey data from more than 2,000 U.S. consumers and aggregates responses across four unique age groups: Linksters (ages 18-23), Socializers (ages 24-37), the MTV Generation (ages 38-53), and Maturists (age 54+).

"Business owners continue to have a tremendous opportunity to drive sales, build their brand, and increase customer loyalty by investing in a robust gift card program," said Dom Morea, Senior Vice President, Head of Gift Solutions at First Data. "Our study shows that gift cards, or branded currency, are not only a potential growth engine for businesses, but are becoming the preferred gift for both purchasers and receivers alike."

Businesses Gain a Heavy Lift from Gift

For the fifth year in a row spending lift from gift cards is on the rise, and business owners should take notice. On average, for every gift card purchased, consumers are spending a whopping $59 more than the original value of their card, a $21 spike from just a year ago. This is especially true for fine dining and fast casual restaurants, along with drug stores. But spending spiked most on supermarket gift cards with consumers spending, on average, 94% more than the original value of their card.

Gift Cards: A Preferred Brand of Currency

Consumers love to give gift cards, more so than any other gift. And more and more receivers of gifts prefer gift cards to physical gifts too. With this in mind, here are a few specific trends to make note of:

• 47% of Linksters (ages 18-23) prefer to have a physical gift card over any other traditional gift
• Consumers plan to spend 55% of their annual gifting budget on gift cards
• 33% of purchasers will spend more on a gift card than they will on a traditional gift

Treat Yourself: Self-purchasing on the rise

Gift cards aren't just used to treat others on birthdays, holidays, and special occasions. Self-purchasing continues to be on the rise, with consumers finding value in buying gift cards for their own personal use. In 2018, 64% of consumers bought a gift card for their own personal use, up from 58% in 2017. Socializers (ages 24-37) saw the biggest jump in self-purchasing rates at 71%, up from 56% in 2017. Fast casual gift cards were the most popular type of gift cards for self-purchasers.

Additional highlights of the study included:

• The average number of physical gifts cards purchased by consumers increased from 6.5 per year in 2017 to 8.0 in 2018; e-gift card purchases also increased from 6.1 per year to 6.3.
• 33% of consumers reloaded a gift card; with Linksters (ages 18-23) reloading the most at 61%.
• Up to 50% of Socializers (ages 24-37) have an interest in buying gift cards through a bank website or mobile app.
• 52% of consumers would prefer to have a single app, like Gyft, that manages all of their gift cards.

To learn how your business can drive sales, bring in new customers, and extend your reach using First Data's Gift Solutions, please visit www.giftsolutions.com.

For additional information about the 2018 Prepaid Consumer Insights Study, please see the dedicated page on First Data's website.

About First Data

First Data (NYSE:FDC) is a global leader in commerce-enabling technology, serving approximately 6 million business locations and 4,000 financial institutions in more than 100 countries around the world. The company's 22,000 owner-associates are dedicated to helping companies, from start-ups to the world's largest corporations, conduct commerce every day by securing and processing more than 3,000 transactions per second and $2.4 trillion per year. For more information, visit www.firstdata.com and follow us on Twitter at @FirstData and LinkedIn.

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