The South Korean gift card market is set for considerable growth, with expectations to expand from a value of US$6.9 billion in 2024 to US$9.1 billion by 2028. This represents a significant compound annual growth rate (CAGR) of 7.0%. As of now, market analysts highlight several key drivers pushing this upwards trajectory, including the rise of e-commerce, the ongoing trend towards remote working, and the increasing popularity of digital gifting.

The surge in the gift card market has been specifically pronounced following an uplift in both retail and corporate environments. Companies, across various sectors such as government, hospitality, and travel, have been leveraging gift cards extensively to motivate and engage employees, especially amidst the increasing adoption of remote working setups. Additionally, corporate entities are using these cards as effective tools for promotions and customer loyalty programmes, signaling a shift in traditional business strategies towards more digitally-oriented consumer engagement methods.

Understanding consumer behaviour within this market reveals a preference for digital gift cards, influenced not only by convenience but also by the digitalisation of the consumer market space. Digital gift cards are particularly popular, given their ease of purchase and delivery, eliminating the logistical barriers associated with physical cards.

South Korea’s progress in digital infrastructure has facilitated innovative uses of gift cards, including in sectors like food and beverage, health and beauty, apparel, electronics, and travel. Market segmentation reveals detailed spending patterns, pointing towards a diversification of the gift card uses across various retail sectors including e-commerce platforms, supermarkets, specialty stores, and more.

From a distribution perspective, the insights show a dynamic shift between online and offline sales channels, with a notable preference for first-party direct sales which allow brands to retain greater control over their gift card programs. This is crucial as businesses aim to maximise profits and enhance the consumer buying experience.

Key market players such as emart, Samsung, Homeplus Hypermarket, Olive Young, and Lotte are not just passive participants but are actively pushing the boundaries of the gift card market to innovate and capture more of the market share. Their strategies often involve targeted marketing and partnerships with other industries to create bundled offers, which further enhance the appeal of purchasing and gifting these cards.

This upsurge in the gift card market in South Korea is grounded in a broader global trend towards digitalisation and personalised gifting, which has seen similar growth trends in markets around the world. As South Korean consumers continue to embrace digital solutions and convenience-oriented products, the gift card market is expected to keep up with changing consumer demands, suggesting robust growth and ongoing evolution in the market’s dynamics through to 2028 and beyond.

These insights into the South Korean gift card market reflect not only the current status but also the potential for future growth, offering critical data for stakeholders looking to navigate and capitalise on these emerging market trends.