How Businesses Make a Fortune on Gift Certificates

Wednesday, February 8. 2006

How Businesses Make a Fortune on Gift Certificates

Don't bother clicking on the gift card- you won't win anything.

Neither did I, when I found an envelope full of gift cards and certificates that I had been holding on to for my now 18 year old daughter. There were all kinds of pretty, color cards. But the ones that drew my eye were two that had $50 stamped on them. They were for the local ritzy, hoytie toytie (how DO you spell that) mall nearby.

Then there was the $100 card for Best Buy. And one for the cool local mom and pop local toy store that carries the coolest educational toys in town.

You're probably wondering why I'm writing about gift cards. Well, the envelope has been sitting on my desk for exactly five years, in full sight, among all of my various desk "stuff". But it wasn't till today that I actually SAW it. See, it had fallen over, from the weight of all those cards.

As you have guessed, every card had expired. Being the tenacious type, I figured I'd call the companies to see if there was a chance in hell in getting a soft-hearted soul who would understand my dilemma. HOW was I going to face my daughter, telling her that she had about $300 worth of expired Bat Mitzvah gifts that I had been keeping safe for her. <note to Terry: never save gift cards to toy stores- cash them in before the giftee turns 18>.

At any rate, I started with Toys R Us. Three people later, I was transferred to Corporate Customer Service <shudder>, where a very sweet man named Tommy tried his best to help me. He heard my plea: "er, sir....I have a hard time keeping track of itty bitty plastic cards with giraffes on them...". He told me to hold on, which gave me time to come up with a better excuse. Before I had a chance to memorize a new script, Tommy came back on to apologize profusely that there simply wasn't anything he could do to rectify the problem. He asked if there was anything else he could help me with (haaaa), then we hung up.

Challenge #2: I called the fancy mall and was promised that someone would get back to me later. Being that it's now nearly midnight, I'd say that was one funny lie.

So it made me wonder just how much money businesses make off of us ADD "types" who simply never remember to cash in those pretty little cards. Or who lose them.

Anyone care to do a study on that?

Posted by Terry at 23:43 | Comments (6)

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I'm sure they BANK on this happening!! Pure revenue. It does not seem like it should be legal that we give them cash, and they give us something that is supposed to "be like cash" that after a certain amount of time they get to keep the cash and we get *nothing*.

It is a racket!!

#1 Kathy on 2006-02-09 17:17

Kathy,

Well said. It IS a racket and I got sucked right into it. I have to come up with a good coaching tip to remind myself-and others- that we have these stupid cards/certificates laying around. Sheesh.

#1.1 Terry (Homepage) on 2006-02-12 22:10

I read an article recently that 8.5% of all gift cards go unredeemed, totaling 4.8 Billion dollars of unused gift cards a year. (I have attached the link to the article below)
However there is good news, as more people are giving gift cards, many states are improving the laws to make the gift cards more consumer and ADD friendly. In fact states such as California, Washington, and Massachusetts have laws that prohibit an expiration date on gift certificates and gift cards.

http://www.dailykos.com/story/2005/12/28/51217/596

#2 John MacKenzie (Adult ADD and Money) (Homepage) on 2006-02-09 17:21

Hi John! (are you Tara's John?)-

Thanks for the article link and the hopeful news that things will be changing. I shudder to think of all the unused gcs I've lost over the years. Probably a down payment on a new car....Grrrrrrr.

Terry

#2.1 Terry (Homepage) on 2006-02-12 22:13

Just this week I finally got around to using the balance on a gift card to find that the balance was zero due to the monthly fees that happened! AGGGHH

#3 christy on 2006-02-15 20:27

I have a Sam's Club/Wal-mart gift card my mom gave me that has a picture of my nephew on it. Nice thing is, it doesn't expire and my mom can refill it anytime she wants. I just keep it in my wallet so I won't lose it, makes it alot easier on both of us.

#4 Lisi (Homepage) on 2006-08-18 09:32

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