Thursday, February 12, 2009

When did gift cards become so popular?

I saw an interesting story on the news the other day. Planned Parenthood of Indiana was making gift cards available in any denomination. When I think of gift cards I immediately think of Chili's, Best Buy, Radio Shack, or Home Depot. I have to admit that I have never considered giving someone a parnethood planning gift card. How do you present a gift card like that? Do you put it in an envelope or in a basket wrapped in a bow? I can just see it now-I give one of these gift cards to a friend who is not actually pregnant. Hmmm.

I understand that gift cards are basically a gift with a guarantee and that they are very convenient gifts for the person who has everything, but I want to get a bargain or buy something on sale. Have you ever seen gift cards on sale? I DID find a website that offers discounted gift cards for restaurants in your area. The truth is, approximately 20% of gift cards never get used which amounts to huge profits for these businesses. A gas card is one that I would surely use but I feel bad for all the folks who got Circuit City gift cards recently. Since I stash most of these gift cards and certificates away where I will never find them it is a bummer that many of them have expiration dates.

So how did gift cards get so popular? Somehow in our twisted sense of giving, we gave up on buying meaningful gifts for other people. Cash seems tacky for some reason, so instead we try to pretend to know what people would like at one store or another. "Mike likes gadgety crap, let's give him a Best Buy card."

The ones I really like to receive are to local restaurants since they are usually to places I have never been. My wife and I visited 9Elm in Danvers, MA this week and were pleasantly surprised at how nice the place was including the food and nice wait staff. Had I not received the gift certificate perhaps we would never have visited and now we have a new local favorite. It is interesting to see how some restaurants give you cash back and some just give you a credit for a future visit. What if I hated the food and didn't want to come back? The $18.46 that was remaining would be pure profit for them while losing a return customer. The other one I always look forward to is from Amazon since I am such a book junkie. Never have I not been able to use one of these and they usually get redeemed on the same day I receive them. Thankfully Amazon has a nice checkout system where you can log in, buy the item and be done in about 2-3 minutes. What a great business model and getting a slightly used book for $1.50 is great, but the shipping is always $3.99. I guess they lose so much on shipping large items that they have to make it up by charging 4 bucks to ship a book which usually shows up in an envelope with $1 postage. I think UPS or the USPS should demand a greater percentage for doing all the dirty work.

Maybe I should consider offering gift cards for use at Meadowview Construction. Just imagine how excited your sister would be if you gave her a $50 gift card to be used toward a $300,000 renovation with a 6 month expiration date. Or maybe we could even set up a web page for wedding registries. Forget that china set for 8 and go for the kitchen renovation. Here's a little tip for anyone wanting to get me a gift or a gift card. GIVE ME CASH. Gift cards cost just as much as cash and they are far less useful.

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