Gift Cards

More and more shoppers are deciding to just give those little plastic cards implanted with a dollar amount that the recipient can use to select merchandise at the store of origin. There are some advantages for the giver in that shopping is greatly simplified and wrapping is not a hassle. It implies more thoughtfullness than cash since you went to the specific store to get the card. The recipient is usually pleased to get the freedom to go shopping for something desired instead of returning something not wanted. These facts pale in comparison to how happy the store is to sell gift cards. First, most of them are used in the month following Christmas and the season is thereby not only extended, but the purchase is usually for more than the value of the card. So, the retailer wins with two store visits rather than the one. In addition, some 10% of the total amount spent on the cards (about $50 billion this year) is never redeemed. Depending on the state laws, this eventually becomes revenue for the retailer. How sweet is that?