The money raked in by Starbucks gift cards is approaching the size of a small country’s economy.
The company says that more than $25 billion has been loaded onto its gift cards since they were launched a decade and a half ago.
That’s about the gross domestic product of Trinidad and Tobago — a relatively prosperous, energy-producing nation off the Venezuelan coast.
A fifth of that amount was loaded onto Starbucks cards just in the fiscal year ended in October, which points to a big acceleration in recent years. And that snowball is still rolling, with Starbucks saying that it’s on track for “another record performance” in gift card sales this year-end shopping season.
The cards, in addition to giving indecisive shoppers a break, are a critical component of Starbucks’ bid for growth. They bring people who might not otherwise go to Starbucks into the store, giving the Seattle company the opportunity of drawing them in. It also represents a big cash advance for the company and good visibility of its costs in the month ahead. Then there’s extra cash the company pockets by selling its “premium” cards — such as a sparkling $200 card embellished with blue Swarovski crystals, which only comes with a $50 load.
Demand for the cards reaches pitch fever on Dec. 24: Last year, 2.5 million cards were sold just on Dec. 24 in the U.S. and Canada, a half-million jump from the previous year. Starbucks says it anticipates breaking that record this year.