Retailers are recognizing that gift cards are a promotion that can bring shoppers in twice — first to buy a card or an item that earns them a card, and second to redeem the cards they received. Merchants are using gift cards to promote specific items, increased ticket sizes, and even to even the sale of other gift cards. Some have gotten creative and even tied their gift cards to charities to promote the sale.

Using information gathered as part of Mercator Advisory Group’s annual closed-loop prepaid cards benchmark survey, Mercator has created a forecast of the dollar amount that will be loaded onto gift cards that are sold in stores in the United States during the 2016 holiday shopping season. This forecast focuses solely on closed-loop cards sold by issuers in the United States to customers for use in their own stores.

"Closed-loop issuers have the opportunity to drive growth in their card programs and their sales in the new year, if they view gift cards strategically," Ben Jackson, Director of Mercator Advisory Group's Prepaid Advisory Service, and author of the report, comments.