QSR April 2023

SHORT ORDER

As of Q1 2022, Starbucks had more than $3.3 billion loaded onto “Starbucks Cards” across the U.S, exceeding a company record. In fact, the java giant’s gifting business was so strong the unit sales of Starbucks Cards were greater than the next four brands of gift cards combined, executives said. Paytronix recently released its Restaurant Gift Card Report: 2023, which found restaurants have moved on from the pandemic, yet still face challenges thanks to inflation. Those changes a ect both how operators sell cards and how consumers purchase them.

The Analysis: “Gift card purchasing appears to mirror that of loyalty guests. Our research shows that loyalty guests’ checks match inflation. From the beginning of 2020 to the present day, restaurant loyalty guest check size grew in tandem with menu prices,” says Kirstin Lynch, Paytronix’s strategy and analytics director.

The Big Point: In 2022, dollars spent on gift cards rose 6 percent over 2021, a high-water mark for gift card value. But, the overall number of gift cards sold fell.

Why? People loaded on more value, choosing more cards of over $25 and fewer that are under $10. Consumers also showed a preference for digital gift cards, not only by purchasing more, but loading them with higher values than on their physical counterparts.

Other Findings: Average dollars loaded per gift card increased 8 percent from 2021.

It’s Not Just About Guests Restaurant marketers are targeting this behavior, too. “Brands themselves may be influencing the trend of higher-value cards by only selling higher-value cards or by making lower value cards less available,” Lynch adds.

Digital cards outperformed physical cards in terms of value, with the average digital card loaded $82 more at a fine-dining establishment than a comparable physical card.

Third-party retail sales grew, while in-store sales dropped, indicating a channel shift.

A Final Point Card sales also showed a shift toward full-service restaurants, with that segment showing significant growth, even as quick-serves, the segment that best weathered the pandemic, showed a 5 percent drop in revenue. This trend was particularly appar ent for fine-dining restaurants. “Fine-dining gift card sales have not only recovered completely from the pandemic, they’ve also been

the only concept to see an increase over 2019 numbers. This indicates a chan nel shift in consumer preferences—as guests emerge from the pandemic, they prefer to gift experiences at fine-dining establishments,” Lynch says.

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APRIL 2023 | QSR | www.qsrmagazine.com