As employers seek innovative ways to support their staff through the cost of living crisis, new research has revealed that use of gift cards as an employee benefit has increased significantly.
According to the latest analysis by the Gift Card and Voucher Association (GCVA) and KPMG UK, sales of gift cards to businesses for use as an employee benefit have soared by 59.2%. This is a result of increased efforts from businesses to provide their employees with access to discounted offers on products and essentials to help to tackle rising costs.
The use of gift cards for rewards and incentives has also risen by 26.8%, reflecting the increasing need for employers to motivate and retain staff, as well as attract new talent, as the recruitment markets becomes more competitive.
Further research by the GCVA, carried out in June, found that the power of incentive and motivation schemes to foster loyalty to a company has increased in the first half of this year. Of those surveyed, 47% said that an incentive, such as a £50 gift card, would have more impact on their loyalty and productivity than before the cost of living crisis hit. With 20% of people saying this increase in impact would be significant.
Gail Cohen, Director General of the GCVA said: “It’s great to see that an increasing number of businesses are seeing the real value of gift cards and the role that they can play in supporting employees through challenging financial circumstances. The increased power of rewards and incentives has clearly been felt by businesses looking to recognise the hard work of their staff and foster new talent with attractive employee benefits.
“This research shows that the B2B market as a whole has grown significantly, with employee benefits and rewards and incentives taking the lions share of the market. B2B remains a vital area for gift card sales, making up 67.4% of the whole market, so it’s extremely encouraging to see continued enthusiasm for their use. Once again, this research illustrates how gift cards can be used in a multitude of ways to support a business.”
Don Williams, Retail Partner at KPMG, said: “The economic outlook is set to be challenging for the next year or more and this will require employers to find new ways to support their employees, similarly to retailers making a renewed effort to attract and maintain customers, as everyone looks for ways to save.
“Despite these challenges, this backdrop may well provide abundant opportunities for the gift card and voucher sector. This can be seen through the strength and growth of employee benefit schemes within the B2B market, highlighting how the gift card industry will play an important role in how employers support their staff.”