We appreciate receiving gift certificates in any denomination and for just about everything, so why don’t we spend them? Each year there are as many gift envelopes tucked in the Christmas tree branches as there are wrapped gifts under the tree, but statistics show many don’t make it back to the store to be redeemed.
So why do we forget about the cards in our wallets or dresser drawer that someone paid for and that were money in the bank for the businesses that issued them? Perhaps it’s because we don’t think of a gift card as cash to spend. Some cards are never used because the recipient is not attracted to what is sold in the store that issued it. Or, in the case of the few I have stashed, it’s a form of savings. If I don’t need the card now, perhaps I will in the future, if not for myself, for someone else.
Despite the extreme misuse of gift cards by consumers, sales for Christmas, birthdays, and all occasions that call for gifts, increase each year. It is estimated that a 5 percent increase in 2012 will bring the sales to $52 billion.
Of that amount, 8 to 10 percent of the cards issued will not be redeemed, based on past performance. The staggering dollar total, according to the National Retail Federation, between 2005 and 2011, was $41 billion not redeemed, making gift cards the most profitable square foot in the retail industry.
Gift cards are a popular request and are particularly favored by teens, who prefer to shop for what they want rather than take a chance of mother, aunt, or grandma trying to please. The common card value is $25, but the average gift card user spends an extra 20 per cent over the value of the card, making it a win-win for the retailer.
Since the cards were introduced in the mid ’90s by Blockbuster, the choice of retailers runs the gamut from gas to groceries and includes airline and cruise travel. They may not be as impressive as a gaily-wrapped gift or as exciting as opening a package, but they do make sense.
Some argue that it’s a lazy way out of shopping. Whether you get the card online, select one from a display of several choices, or buy directly from the store, it surely is easier than shopping for the right size, color, and style and being sure to tuck in a gift receipt so that it can be returned.
We can only hope that the card is redeemed. Otherwise our money is going directly into the store’s pocket. That was not our intention nor is it the recipient’s once they think about it.
The two $25 gas cards I received this Christmas will definitely be used very soon. But three $20 supermarket coupons have been in a drawer far past the expiration date. Though I deserve to lose $60 of groceries in one of my favorite stores for being so careless, the management said it would honor them. That is not always the case. I am not so lucky with a $45 beauty shop certificate that I put away and now can’t find or even remember the name of the shop.
Restaurant gift cards are popular and they are also easy to put aside until the perfect day to go to the restaurant, perhaps for friends to join you, or for any other number of excuses. Then the restaurant goes out of business and what do you do? You cry a little and perhaps acknowledge that you learned a bitter lesson.
There are solutions to the unused gift card issue but I suggest it is kept a secret from the person it was received from. Re-gifting to a friend or perhaps to a charity should be done before the expiration date. Cards also can be posted on Craigslist or Ebay. Cards that are between $25 and $200 and qualify on a specified list can be exchanged for cash through Web sites such as SwapaGift.com.
GiftCardRescue.com and PlasticJungle.com redeem cards for a percentage of their face value.
Mary Alice Powell is a retired Blade food editor.
Contact her at: email@example.com.