News

Study: QSR gift cards redeemed most quickly

December 6, 2018

Digital guest experience platform, Paytronix Systems, Inc., today released its inaugural Gift Card Sales Report, using data from more than 190 restaurant brands and 550 stored value program figures to project restaurant gift card sales trends, a news release said. The study focused on the impact of various sales channels and consumer redemption rates, particularly during the holiday season.

One key finding was that third-party channels accounted for more than half of all restaurant gift card sales in 2017, for both units sold and total dollars. Third-party channels include discount warehouses, like CostCo, as well as gift cards sold in retail establishments not owned by the restaurant brand, including grocery, convenience or drug store outlets.

"Third-party retail sales are a critical component to any gift card program and this report underscores its value for restaurant brands," Paytronix co-founder and President Andrew Robbins, said in the release. "Gift sales contribute substantial top-line impact, plus it offers the often overlooked benefit of being one of the most effective customer acquisition programs."

As part of this report, Delaware-based Grotto Pizza, said its strategic gift program with Paytronix helped grow sales 30 percent, while Zaxby's said it grew gift sales 18 percent.  

Other key findings include:

• 0.76 percent growth from 2016 to 2017 in gift card sales.
• In-store sales fell to 42.8 percent of all gift card sales last year from 2016 as third-party retailers gained popularity.
• Holiday season, in-store sales were 51.5 percent of all sales, however, from Nov. 1 to Dec. 24, 2017.
• Around 70 percent of all gift cards are redeemed within 180 days of purchase.
• About 20 percent of gift cards retain balances a year later. 
• QSR gift cards are redeemed most quickly, with a 75% redemption rate after 180 days compared to 52 percent for fine dining.