Consumers Prefer Grocery Gift Cards Over Spa Massages, New Report Suggests

Inflation has created a seismic shift in consumer preferences, with grocery gift cards now being considered more valuable than spa massages, according to a Merkle report. The 2023 Consumer Prizing Report shows how consumers choose rewards from brands, suggesting that nearly 75% of respondents see gift cards for groceries as a necessity rather than just a desirable extra.

The survey aims to investigate consumer preferences for loyalty programs and promotions offered by brands and understand how consumer sentiment towards these programs has shifted due to inflation and rising costs of goods.

"The report highlights how brands can improve prize and incentive strategies to drive desired consumer behaviors through promotions, branded games, chance to win experiences, and loyalty programs. Consumers prefer options that are convenient and make everyday lives easier. Consumer sentiment has predictably shifted as people are keeping a closer eye on the household budget," said Jen Gray, SVP of Experience Creative, Promotion & Loyalty Solutions, Merkle.

Key findings include:


Rewards that cater to everyday necessities, such as groceries, mortgage, or rent payments, are highly preferred by consumers across all income groups, particularly for low-income households, where 80% of respondents expressed a preference for such rewards. In addition, 72% of middle-income and 61% of high-income households also showed a similar preference for rewards that provide financial relief and value.

Generational divide 

There is a difference in the reward delivery preferences of different generations. The survey showed that 32-50% of Gen X and baby boomers prefer receiving rewards in the form of Visa or Amazon gift cards, while nearly 47% of millennials and Gen Z prefer Venmo or PayPal credit.

Impulse control 

Baby boomers tend to have better impulse control than Gen X, as 77% are prepared to wait for a larger sum of cash, regardless of the denomination. In contrast, 53% of Gen X prefer a guaranteed small reward and show a stronger interest in this type of prize compared to other generational groups.

Digital Currency  

Even though being only in the 4%, millennials tend to be the ones to accept cryptocurrency as a reward most willingly. On the other hand, 11% of Gen X are open to receiving cryptocurrency as a prize, indicating a curiosity towards digital currency, but still with preferences towards more secure methods.

Price Preferences  

Both men and women are attracted to brand vacations and shopping sprees as grand prizes. Women see shopping sprees, vacations, and room makeovers as the most appealing physical prizes, while men prefer a lifetime supply of their favorite brand, followed by a vacation and shopping spree. However, the preference for a shopping spree and vacation among men is primarily driven by millennials and baby boomers, likely due to budget constraints.

"It's no surprise that consumer preferences have shifted given the dynamic external environment. Additionally, consumers are savvy and will chose a benefit to suit their needs. The insights in this report will help marketers improve engagement rates, while deepening the customer relationship. Adjusting the rewards strategy to match customer preference is critical to ensure high retention rates. Marketers who do not will experience customer churn," added Gray.

Elsewhere, Merkle has recently introduced a new identity resolution platform for CPGs and retail brands -Merkury for Commerce.