Increased Sales: Gift cards often lead to additional purchases beyond the card's value. Recipients may spend more than the card amount when redeeming it, leading to increased sales for the retailer.

Customer Acquisition: Gift cards can attract new customers who may not have previously shopped at the store. If someone receives a gift card to a store they've never visited, they may become a repeat customer if they have a positive experience.

Brand Exposure: Gift cards serve as miniature advertisements for the retailer. When someone gives a gift card to a friend or family member, they're essentially promoting the retailer's brand.

Cash Flow: Selling gift cards provides immediate cash flow for retailers, even if the cards are not redeemed right away. This can be particularly beneficial during slower periods.

Loyalty Programs: Gift cards can be integrated into loyalty programs, encouraging repeat business from existing customers.

Reduced Returns: Unlike traditional gifts, gift cards significantly reduce the likelihood of returns or exchanges since the recipient chooses what they want.

Data Collection: When customers purchase and redeem gift cards, retailers can collect valuable data about consumer behavior and preferences, which can inform marketing strategies and product offerings.

Gift Card Fees: Some retailers charge fees for inactive gift cards or for customization options, providing an additional revenue stream.

Inventory Management: Gift cards help retailers manage inventory by allowing them to sell gift cards for specific products or services that may be overstocked or seasonal.

Customization Options: Offering personalized or branded gift cards can enhance the retailer's brand image and appeal to customers looking for unique gifts.