A gift card is always perfect as a last-minute present or if you’re stuck for what to get someone for Christmas - you can’t ever really go wrong. But with many people unable to see their loved ones face-to-face this year, gift cards have also proved to be an easy way to show someone that you’re thinking of them during the locked-down festivities.
2020 was a year like no other - and for the hospitality sector it marked a considerable shift in the need to diversify income streams and embrace technology like never before. Toggle has been well-positioned to support this, with the platform providing an easy way for operators to raise pre-sold revenue through gift card sales and to sell retail products and at-home experiences directly to customers. This has been a notable trend throughout the year, but it became particularly apparent during December - with Toggle seeing a 39% increase in digital sales compared to last year. Despite this uplift, overall total sales remained comparable with December 2019 at £1.3m, due to in-venue sales dropping off a cliff during what would normally be the busiest period of the year.
We’ve delved into the data to highlight some notable December trends. We’re referring to stats solely derived from Toggle clients, which include national operators through to independent venues. The demographic data is drawn from businesses that use both Toggle and Airship.
Unsurprisingly, in-venue sales accounted for just 8% of overall sales this December, compared to 28% during the same period last year. And with online shopping soaring during the pandemic, Toggle customers’ digital card sales accounted for 69% of all purchases, compared to 49% last year. We reflected in 2019 that physical gifts tend to be king at Christmas with the public leaning towards something tangible, and we expect this trend to resurrect when things return to some normality. So the lesson here is to ensure you’re selling both physical and digital cards otherwise you’ll miss out. If you’re not doing so already and want to start selling physical cards, get in touch.
Whilst gift cards accounted for more than 4-in-5 transactions in December, it is interesting to note that over £63,000 of retail products were also sold. This was just 5% of overall Toggle sales, however most Togglers did not offer retail products - such as branded drinks, sauces and wall prints. Of those that did, retail products accounted for 44% of their overall sales, proving that this is a revenue avenue well worth pursuing in 2021.
Sales spiked around Black Friday, as we’d expect, and the trend in December was a steady climb throughout the month, peaking on Christmas Eve with people shopping for last-minute gifts, before dropping off into the new year. This mirrors last year’s sales trend. But it’s perhaps interesting to note that over £25,000 of sales were made on Christmas Day itself - something to bear in mind for promotions next year.
Well, everyone, but there are some definite trends. Females continue to be the most likely to purchase a gift card, with 58% of sales compared to 42% attributed to men.
We’ve seen a dramatic demographic shift in the age group most likely to buy a gift card, with those aged 21-30 overtaking 31-40 year olds in 2020. But in every age group category, the percentages were ahead of the previous year.
In response to Toggle’s Christmas trading results, our CEO Dan Brookman has commented: “We quadrupled the number of operators on Toggle over the last 12 months. There were some noticeable winners as far as revenue, and what we recognise is that consumers are still trusting the brands that they love. Retail and experiences will continue to drive up revenue growth. We now have licensed distribution for operators who are looking to package and sell alcohol.
“Gifting in hospitality is still very early in its evolution. For operators to maximise the opportunity, it must become a revenue channel that’s part of the overall strategy. Gift cards provide an invaluable route to new customers and therefore brand engagement.”
Remember, pre-sold revenue is just the start for these operators. People will often continue spending beyond the value of their gift card, and they’re unlikely to visit a venue alone. Where someone has been bought a card as a gift, we know that 18% of recipients will become a regular customer, with their potential first visit affinity heightened by the fact that it has already been paid for.
We shared a similar data and lessons-to-learn article for Black Friday 2020 last month - take a look at it here.