2025 Prepaid Holiday Preview: Gift Cards Could Provide Safe Harbor

Tariffs and the will-they-or-won’t-they question of the effects on goods people want remain a pervasive threat to the growth of holiday shopping in 2025. Although the 2024 holiday shopping season showed positive momentum, the outlook for 2025 remains muddled. How to follow up on a strong 2024 holiday season may be hard to visualize in the heat of summer, but planning is well underway. The 2025 shopping season may incur a rash of last-minute swings as consumers grasp the impact of economic changes in the first half of the calendar year. This action could prove to be a boon for the gift card industry, with buyer preferences and the potential for less discounting shift purchases from physical items to the promise of a future purchase. The entirety of the gift card ecosystem, from retailers to program managers to those in card production or stored-value wallet management, must be prepared to step in and fill voids in the gifting marketplace. 

Consistent with prior years, open-loop and closed-loop gift cards continue to be the preferred gift for recipients and buyers. Javelin research also highlights opportunities to position gift cards against physical gifts and also other gift card competitors. The long-term ramifications begin with enticing the giver to purchase a particular card, then must be followed up by providing the recipient with a positive engagement that emphasizes a future relationship based on loyalty and associated benefits.

Key questions discussed in this Prepaid payment card report: 

• How will the retailers utilize gift cards to reduce risks from the chaos of on-again, off-again tariff threats?
• What can open and closed-loop gift card providers do to stand out in the holiday market?
• What changes does Javelin see in shopping behavior from previous years?
• How do other holidays and events affect the winter holiday season?

Companies Mentioned: 

American Express, Blackhawk Network, Delta, Discover, Disney, Fiserv, Hotels.com, Marriott, Mastercard, National Retail Federation, Visa