Scottish fintech Miconex has revealed that over £1.9 million was spent through its Town and City Gift Card programmes in 2020, providing evidence that consumers are turning to local, multi-venue gift card programmes in a bid to support local businesses. The 2020 sales data represents 350% year on year growth for the firm.
Perth based Miconex took its total number of programmes in Scotland to 17 in 2020, including new schemes launching in Aberdeen, Falkirk district, Kirkcaldy and rural Scotland, as places sought to harness the shop local sentiment and unite businesses behind one gift card that can be spent across retail, leisure, hospitality and services.
Christmas was a key trading period for Miconex, with 10 of its Scottish schemes recording five figure sales in November and December. Aberdeen achieved over £130,000 in gift card sales in December alone.
In the UK market, Miconex reports that gift card transactions in the last two months of 2020 were largely driven by Boomers (55 plus) and Generation X shoppers (aged 35-54), representing 34.88% and 32.33% of transactions respectively. Millennials (25-34) accounted for 19.89% of transactions and Generation Z (16-24) 12.89%.
Data also revealed that the older the customer, the higher the purchase value with 46.75% of revenue generated by Boomers, 33.63% for Generation X, 14.12% for Millennials and 5.5% for Generation Z. Thus, whilst under 34s accounted for over 32% of transactions, they represented 19.62% of revenue for gift card sales.
Women purchased more gift cards, representing 53.18% of all transactions but 49.72% of revenue due to lower gift card purchasing value than men.
The sales figures from Miconex have demonstrated success with gift card programmes for both small towns and big cities. In Kirkwall, population 9000, located on the Orkney Islands off Scotland’s north coast, over £80,000 was spent through the Kirkwall Gift Card in 2020. Laura Bruce, consultant for Kirkwall BID received a High Street Heroes award from Scotland’s Towns Partnership for her efforts to support the Orkney economy in 2020. Laura commented:
“We launched the Kirkwall Gift Card in December 2019 and have around 80% of retail type businesses signed up to receive the Kirkwall Gift Card. People will come from other islands to Kirkwall to spend their card, and with pop up shops and even click and collect over the festive period, we’ve been able to cater for all shopping preferences.
“In 2020, the pandemic meant Orkney lost out on the usual tourism income but our corporate sales really increased. 15% of our sales actually came from outside Orkney, from as far as Australia, as people purchased them as gifts for family and friends living here. As well as keeping money locked in Orkney, we’re also bringing new money in. The amount of positive comments we get about the Kirkwall Gift Card are unreal.”
One of the larger cities that has enjoyed significant success with its gift card programme is Aberdeen, which has a population of over 200,000. Adrian Watson, chief executive of Aberdeen Inspired, said: “We have been pleased with the fantastic sales the Aberdeen Gift Card has had since it launched in late November. With 3500 cards bought with a total value of £150,000, it really has given a boost to the local economy. Aberdeen Inspired worked incredibly hard in a short timescale to launch it in time for Christmas and it has helped to make a big difference at a time when it was, and is, most needed.”
Miconex’s sales performance aligns with findings of increased buoyancy in the gift card market during November and December. The Gift Card and Voucher Association reported a marked increase in overall gift card buying in December 2020, with 51.5% of respondents purchasing a gift card for self-use or as a gift. They also found that 25.2% of people purchasing gift cards for others and 24.2% purchasing gift cards for themselves, did so to show support for local businesses.
Colin Munro, managing director of Miconex believes the success of its Town and City Gift Card concept is just the start of what can be achieved with local gift card programmes: “The shop local sentiment has been building globally for some years now, as we see a return to community and all of the benefits strong communities bring. The pandemic has accelerated the shop local trend and increased the demand but is not the sole cause of it. What our places have done is convert the demand for local shopping into economy boosting revenue, in a programme that works just as well in a small town as in a large city, creating an unbeatable consumer product.
“What we can see from the 2020 data is that multi-venue gift cards are popular across the generations. As we would expect, Boomers and Generation X shoppers spend most when they buy gift cards, due to their greater disposable income but Millennials and Generation Z are vital to the long term success of gift card programmes; once that loyalty is gained, purchase values can increase alongside disposable income. Overall, this is data that we will use to continue to support our new and existing gift card programmes around the UK and Ireland.”
ENDS
