Gift cards remain a popular choice for Americans who are not good at picking appropriate presents, have little time to shop or are last-minute consumers.
Because of those reasons, this holiday season, the National Retail Federation (NRF) estimates about $26 billion worth of gift cards would be purchased and given as Christmas present to family, relatives and friends. The bulk of its purchase is on the last four days before Christmas, reports Tulsaworld.
But that figure is only about one-fourth of the total $120 billion gift cards spent by American consumer yearly. The amount is expected to steadily rise through 2017, says CEB TowerGroup, a research company.
Besides holidays, gift cards too are given away during corporate events and children's birthday parties. Consumer behavior experts explain the popularity of gift cards to the convenience it offers to the giver as well as the recipient.
The NRF's yearly poll confirms it, with 59 percent of survey respondents this year stating they want to receive one. It is particularly a preferred present by people under 25 years old who do not want the gift giver to attempt to figure out what present they want to receive.
But despite its popularity, an estimated $1 billion worth of gift cards were unused in 2014 because the card was likely not from a store the receivers liked, says CEB. Options available for those who would get undesired gifts cards include returning it to the store and re-gifting the card and donating it to charity, suggest Chicago Tribune.
Whitney Young, a college student at the George Washington University, points out, "It's a lot better than giving cash and a lot more useful than picking out something they might not use." She plans to buy five gift cards for the Yuletide holidays. One of it, an American Express card, is for her mother and a Best Buy card would go to Young's father.
However, analysts say gift cards could never replace the joy of seeing wrapped presents under the Christmas tree and opening it on Christmas Eve or Day. But there are also suggestions from YouTubers that the cards could still be wrapped nicely and be placed under the tree too.