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 Dipo Olowookere
The local stock market firmed up by 1.13 per cent on Friday as appetite for Nigerian stocks remained strong.
Investors reacted well to the 2026 budget presentation of President Bola Tinubu to the National Assembly yesterday, especially because of the more realistic crude oil benchmark of $64 per barrel compared with the ambitious $75 per barrel for 2025. This year, prices have been between $60 and $65 per barrel.
Business Post observed profit-taking in the commodity and energy sectors as they respectively shed 0.14 per cent and 0.03 per cent.
But, bargain-hunting in the others sustained the positive run, with the consumer goods index up by 3.82 per cent.
Further, the industrial goods space appreciated by 1.46 per cent, the banking counter improved by 0.08 per cent, and the insurance industry gained 0.04 per cent.
As a result, the All-Share Index (ASI) increased by 1,694.33 points to 152,057.38 points from 150,363.05 points and the market capitalisation chalked up N1.080 trillion to finish at N96.937 trillion compared with Thursday’s closing value of N95.857 trillion.
A total of 34 shares ended on the advancers’ chart, while 24 were on the laggards’ log, representing a positive market breadth index and bullish investor sentiment.
Austin Laz gained 10.00 per cent to close at N2.42, Union Dicon also jumped 10.00 per cent to N6.60, Tantalizers increased by 9.80 per cent to N2.69, Aluminium Extrusion improved by 9.78 per cent to N12.35, and Champion Breweries grew by 9.71 per cent to N16.95.
Conversely, Sovereign Trust Insurance dipped by 7.42 per cent to N3.87, Royal Exchange lost 6.84 per cent to trade at N1.77, Omatek slipped by 6.84 per cent to N1.09, Eunisell depreciated by 5.88 per cent to N80.00, and Eterna dropped 5.63 per cent to close at N28.50.
Yesterday, traders transacted 1.5 billion units worth N21.8 billion in 25,667 deals compared with the 839.8 million units sold for N32.8 billion in 23,211 deals in the preceding session, showing a surge in the trading volume by 76.61 per cent, an uptick in the number of deals by 10.58 per cent, and a shrink in the trading value by 33.54 per cent.
By Adedapo Adesanya
Three stocks stretched the bearish run of the NASD Over-the-Counter (OTC) Securities Exchange by 1.21 per cent on Friday, December 19, with the market capitalisation giving up N26.01 billion to close at N2.121 billion compared with the N2.147 trillion it ended a day earlier, and the NASD Unlisted Security Index (NSI) dropping 43.47 points to 3,546.41 points from 3,589.88 points.
The trio of FrieslandCampina Wamco Nigeria Plc, Central Securities Clearing System (CSCS) Plc, and NASD Plc overpowered the gains printed by four other securities.
FrieslandCampina Wamco Nigeria Plc lost N6.00 to sell at N54.00 per unit versus N60.00 per unit, NASD Plc shrank by N3.50 to N58.50 per share from N55.00 per share, and CSCS Plc depleted by N2.91 to N33.87 per unit from N36.78 per unit.
On the flip side, Air Liquide Plc gained N1.01 to close at N13.00 per share versus N11.99 per share, Golden Capital Plc appreciated by 70 Kobo to N7.68 per unit from N6.98 per unit, Geo-Fluids Plc added 39 Kobo to sell at N5.50 per share versus N5.11 per share, and IPWA Plc rose by 8 Kobo to 85 Kobo per unit from 77 Kobo per unit.
During the trading day, market participants traded 1.9 million securities versus the previous day’s 30.5 million securities showing a decline of 49.3 per cent. The value of trades went down by 64.3 per cent to N80.3 million from N225.1 million, but the number of deals jumped by 32.1 per cent to 37 deals from 28 deals.
Infrastructure Credit Guarantee Company (InfraCredit) Plc finished the session as the most active stock by value on a year-to-date basis with 5.8 billion units valued at N16.4 billion, followed by Okitipupa Plc with 178.9 million units transacted for N9.5 billion, and MRS Oil Plc with 36.1 million units traded for N4.9 billion.
The most active stock by volume on a year-to-date basis was still InfraCredit Plc with 5.8 billion units worth N16.4 billion, trailed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.7 million, and Impresit Bakolori Plc with 536.9 million units traded for N524.9 million.
By Adedapo Adesanya
It was not a good day for the Nigerian Naira at the two major foreign exchange (FX) market on Friday as it suffered a heavy loss against the United States Dollar at the close of transactions.
In the black market segment, the Naira weakened against its American counterpart yesterday by N10 to quote at N1,485/$1, in contrast to the N1,475/$1 it was traded a day earlier, and at the GTBank forex counter, it depreciated by N2 to settle at N1,467/$1 versus Thursday’s closing price of N1,465/$1.
In the Nigerian Autonomous Foreign Exchange Market (NAFEX) window, which is also the official market, the nation’s legal tender crashed against the greenback by N6.65 or 0.46 per cent to close at N1,464.49/$1 compared with the preceding session’s rate of N1,457.84/$1.
In the same vein, the local currency tumbled against the Euro in the spot market by N2.25 to sell for N1,714.63/€1 compared with the previous day’s N1,712.38/€1, but appreciated against the Pound Sterling by 73 Kobo to finish at N1,957.30/£1 compared with the N1,958.03/£1 it was traded in the preceding session.
The market continues to face seasonal pressure even as the Central Bank of Nigeria (CBN) is still conducting FX intervention sales, which have significantly reduced but not remove pressure from the Naira. Also, there seems to be reduced supply from exporters, foreign portfolio investors and non-bank corporate inflows.
President Bola Tinubu on Friday presented the government’s N58.47 trillion budget plan aimed at consolidating economic reforms and boosting growth.
The budget is based on a projected crude oil price of $64.85 a barrel and includes a target oil output of 1.84 million barrels a day. It also projects an exchange rate of N1,400 to the Dollar.
President Tinubu said inflation had plunged to an annual rate of 14.45 per cent in November from 24.23 per cent in March, while foreign reserves had surged to a seven-year high of $47 billion.
Meanwhile, the cryptocurrency market was dominated by the bulls but it continues to face increased pressure after million in liquidations in previous session over accelerating declines, with Dogecoin (DOGE) recovering 4.2 per cent to trade at $0.1309.
Further, Ripple (XRP) appreciated by 3.9 per cent to $1.90, Cardano (ADA) rose by 3.5 per cent to $0.3728, Solana (SOL) jumped by 3.4 per cent to $126.23, Ethereum (ETH) climbed by 2.9 per cent to $2,982.42, Binance Coin (BNB) gained 2.0 per cent to sell for $853.06, Bitcoin (BTC) improved by 1.7 per cent to $88,281.21, and Litecoin (LTC) soared by 1.2 per cent to $76.50, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.
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