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Friday, December 31, 2020

It’s the thought that counts, but what the hell were they thinking when when they got you a gift card for Wicks’n'Sticks?

Rather than deposit that little piece of plastic into the local landfill, you can hit the appropriate websites to swap out your gift currency for some to a store that’s more your style.

The swapping I can understand, even if the dollar amounts don’t exactly match. I mean, if you’re not going to ever step foot into a Home Depot, then it’s worthwhile for you to trade that $50 certificate to someone who loves the place, and take his $25 gift card for the local Apple store (if that’s how you roll) in exchange.

What’s harder to understand is buying a gift card on eBay for more than face value, as you occasionally hear about (I’d try to find an example online, but I currently don’t feel like it).

You’d think the retailers would object to this trading market, but so far, they’re cool with it:

CardAvenue and SwapAGift said interest is increasing as word spreads, and there’s no question about the popularity of the gift cards. The National Retail Federation, the world’s largest retail trade association, said consumers planned to spend more than $17 billion on gift cards this holiday season.

Spokeswoman Ellen Tolley said the federation didn’t have a position about the Internet reselling of gift cards, but pointed out that retailers do, in fact, want customers to use their gift cards.

For one, retailers typically do not record a sale as made until the gift card is redeemed. And, she said, gift cards provide a good way for a store to introduce itself to consumers or to boost spending.

“Retailers’ hope is that people will redeem the gift card, and spend a little extra,” she said.

Really, it’s a no-lose proposition for retailers: The vast majority of gift card redeemers will wind up spending more than the value of card, resulting in a sale where one may never have existed. That percentage of cards that never get redeemed wind up as free money to the stores; whether they get counted as actual sales is irrelevent, it’s still dollars tacked onto the bottom line (minus whatever cut the gift card services get, which isn’t much).

- Costa Tsiokos, Fri 12/31/2004 06:33:46 PM
Category: Internet, Business | Permalink |

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