Economy
The Gift Card Economy: Exploring the Rise of Gift Cards
The greatest way of expressing love and gratitude is through gifting. Since the history of mankind, the act of gifting is an integral part of every society in the world.
In traditional society, people send tangible items as gifts but the transition into a digital society has revealed gift cards to be the currency of the act of gifting.
Some time ago before gift card adoption evolved to a substantial extent like it is today, it was considered nothing more than a worthless and inefficient plastic card.
Today in Nigeria, gift cards have become the perfect gift choice for gift givers and recipients as well because of their convenience, portability and value. The transition to a more digital society has also reshaped people’s shopping behaviour, stirring a massive adaptation to online shopping, hence, giving more credence and value to gift cards.
With the use of gift cards, gift givers need not worry about the type of gifts to buy. They just simply purchase the gift cards from stores and send them to the recipient, who will redeem them for any type of gifts suitable to them or find means of how to sell gift cards.
Gift cards serve as a surprise gift for a retiree, employee, friend, lover and many more and it is very important to choose gift cards with the highest resale value when gifting them. This will enable them to profit from the high gift card rates if they don’t want to buy gifts from the store and decide to sell them.
Some recipients can even sell gift cards for cash if they don’t need the gift item.
With the massive acceptance of gift cards over the years, gift card trading will continue to grow with the economy as it gives a more personalized, digital and convenient gifting experience.
The Magical Transformation: From Inefficiency To Efficiency
The innovation of the first gift card in 1994 and other brands which later joined the gift card market in the early 2000s, was ensued by some bottlenecks which projected the invention as inefficient.
Apart from the major problem of gift card fraud which took a toll on the industry due to the feeble nature of the market, many customers did not utilise the gift cards they purchased.
Many people challenged the efficiency of gift cards when the New York Times in 2007 asserted that about $8 billion out of the $80 billion spent on gift cards in 2006 was not redeemed. In fact, due to the rate of unredeemed gift cards, some economists asserted that gift cards were poor gifts which were merely gifts bought for the issuing companies who earn “breakage” (unclaimed gift cards reclaimed by the issuing company) from them.
However, in recent times, due to the technological and e-commerce revolutions, the archaic perspective about gift cards had become history and gift cards have become the most desirable gifting experience.
The Trend Gap Of The Gift Card Economy: An Exchange of True Value
When we consider the constant e-commerce and digital revolutions we live, one may understand that people are open to giving and receiving gift cards for many reasons like;
1. Flexible Spending And Unlimited Choice Of Gift Cards:
Even though there are some restrictions on the closed-loop gift cards which would force users to only spend the gift card on that same brand, 78.7% of people still use gift cards from strange brands and about 87.7% tend to become customers afterwards. However, an open-loop gift can be redeemed at any store that accepts debit and credit cards. This type of gift card is not restrictive to brand stores, hence, the versatility of gift cards makes it a perfect gift choice.
2. Gift Card Purchases Are Now Planned:
Unlike the old popular belief that gift cards gifting is not properly planned which makes it a poor gift, a gift card report by Incomm stated that 86% of gift cards purchased in the US are planned and 55.8% of recipients received the gift cards for their brand of choice.
3. Number Of Unused Gift Cards Drop Annually:
In the early days of gift card usage, one of the problems was the big fraction of unredeemed gift cards. However, according to Bankrate, the number of unused gift cards reduced by 25% annually.
4. Gift Card Purchases For Personal Use:
Individuals tend to buy more gift cards for themselves than they did in the past ten years. According to research by Black Hawk Network, 33% of the gift cards purchased in 2019 were for the owners.
Some of the reasons individuals purchase personal gift cards are;
- Financial budgeting and diplomacy
- The convenience of gift card transaction
- The safety of gift cards
- An alternative method of payment
Conclusion
The gift economy is still a fast-growing one which has been predicted to reach about $440 billion by 2027. With the desire for convenience, value and safety in gifting and transactions, gift cards are the ideal gifting strategy and also, a very good way to make in-store and online transactions with ease.
By Adedapo Adesanya
The duo of Geo-Fluids Plc and Afriland Properties Plc propelled the NASD Over-the-Counter (OTC) Securities Exchange up 0.13 per cent on Friday, January 10.
Investors gained N1.4 billion during the trading session after the market capitalisation of the bourse ended at N1.053 trillion compared with the previous day’s N1.052 trillion, and the NASD Unlisted Security Index (NSI) increased at the close of business by 4.07 points to wrap the session at 3,073.93 points compared with 3,069.86 points recorded at the previous session.
Geo-Fluids added 25 Kobo to its value to close at N4.85 per unit compared with the previous session’s N4.60 per unit, and Afriland Properties Plc gained 24 Kobo to close at N16.25 per share versus Thursday’s closing price of N16.01 per share.
There was a 35.4 per cent fall in the volume of securities traded in the session as investors exchanged 4.3 million units compared to 6.6 million units traded in the preceding session, the value of shares traded yesterday went down by 37.4 per cent to N17.2 million from the N27.5 million recorded a day earlier, and the number of deals decreased by 47.2 per cent to 19 deals from the 36 deals recorded in the preceding day.
FrieslandCampina Wamco Nigeria Plc remained the most active stock by value (year-to-date) with 1.9 million units worth N74.2 million, followed by 11 Plc with 12,963 units valued at N3.2 million, and Industrial and General Insurance (IGI )Plc with 10.7 million units sold for N2.1 million.
IGI Plc closed the day as the most active stock by volume (year-to-date) with 10.6 million units sold for N2.1 million, trailed by FrieslandCampina Wamco Nigeria Plc with 1.9 million units valued at N74.2 million, and Acorn Petroleum Plc with 1.2 million units worth N1.9 million.
By Adedapo Adesanya
The Naira witnessed a depreciation on the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Friday, January 10.
According to data from the FMDQ Exchange, the local currency weakened against the greenback yesterday by 0.12 per cent or N1.80 to sell for N1,543.03/$1 compared with the preceding day’s N1,541.23/$1.
The pressure on the domestic currency came as the access granted to the Bureaux de Change (BDC) operators by the Central Bank of Nigeria (CBN) to purchase FX from the official market through the Electronic Foreign Exchange Matching System (EFEMS) platform prepares to end next week, precisely on January 19.
The CBN had given a 42-day window to the operators to access the platform to help stabilise the Naira in December, and this expires next week.
On Friday, the Nigerian currency tumbled against the Pound Sterling in the official market by N30.78 to sell for N1,889.29/£1 compared with the previous day’s N1,858.51/£1, but gained N5.48 against the Euro to finish at N1,583.81/€1, in contrast to Thursday’s rate of N1,589.29/€1.
As for the parallel market, the Nigerian Naira remained stable against the US Dollar during the trading session at N1,650/$1, according to data obtained by Business Post.
In the cryptocurrency market, it was bearish as the US economy added 256,000 jobs last month, the Bureau of Labor Statistics reported on Friday, topping forecasts for 160,000 and up from 212,000 in November (revised from an originally reported 227,000).
However, the readings came after a number of recent economic reports triggered a broad-market pullback across asset classes such as crypto as investors quickly scaled back the idea of a continued series of Federal Reserve rate cuts in 2025.
Cardano (ADA) fell by 3.6 per cent to trade at $0.921, Solana (SOL) slumped by 2.8 per cent to $185.93, Ethereum (ETH) depreciated by 1.4 per cent to $3,233.27, Litecoin (LTC) lost 1.3 per cent to finish at $103.62, Dogecoin (DOGE) shed 0.5 per cent to sell at $0.3315, Bitcoin (BTC), waned by 0.2 per cent to $94,154.43, and Binance Coin (BNB) went south by 0.1 per cent to $693.30.
On the flip side, Ripple (XRP) jumped by 1.5 per cent to settle at $2.34, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) sold flat at $1.00 each.
By Dipo Olowookere
Profit-takers took control of Customs Street on Friday, plunging it by 0.08 per cent at the close of trading activities.
The sell-offs were across all the key sectors of the Nigerian Exchange (NGX) Limited on last trading session of the week.
The insurance space went down by 1.53 per cent, the banking index depreciated by 0.41 per cent, the consumer goods sector weakened by 0.16 per cent, and the energy counter slumped by 0.08 per cent, while the industrial goods sector closed flat.
At the close of business, the All-Share Index (ASI) tumbled by 79.68 points to 105,451.06 points from 105,530.74 points and the market capitalisation retreated by N48 billion to N64.303 trillion from N64.351 trillion.
Yesterday, investors traded 1.5 billion shares worth N19.4 billion in 12,877 deals compared with the 489.5 million shares worth N13.1 billion transacted in 13,010 deals in the preceding day, indicating a decline in the number of deals by 1.02 deals and a rise in the trading volume and value by 203.14 per cent and 48.09 per cent, respectively.
Wema Bank was the busiest stock with 976.2 million units valued at N9.8 billion, Tantalizers traded 53.0 million units worth 129.6 million, Universal Insurance sold 34.8 million units for N26.8 million, Access Holdings exchanged 33.9 million units valued at N843.8 million, and Nigerian Breweries traded 27.3 million units worth N873.3 million.
The heaviest loss was suffered by Sunu Assurances with a decline of 9.99 per cent to trade at N7.30, Eunisell shed 9.96 per cent to N17.35, SAHCO crumbled by 9.87 per cent to N30.15, DAAR Communications plunged by 9.28 per cent to 88 Kobo, and Sovereign Trust Insurance went down by 7.04 per cent to N1.32.
On the flip side, C&I Leasing gained 10.00 per cent to close at N4.51, Honeywell Flour appreciated by 9.99 per cent to N10.02, Trans Nationwide Express jumped by 9.89 per cent to N2.00, RT Briscoe rose by 9.83 per cent to N2.57, and Secure Electronic Technology grew by 9.46 per cent to 81 Kobo.
Business Post reports that the bourse ended with 33 price gainers and 25 price losers, indicating a positive market breadth index and strong investor sentiment.
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