Merchant gift cards were the third most popular gift, behind clothing and the CD/DVD catagories.Gift cards. Now that Christmas is over, you need to be aware of a few more gift card facts… especially if your were a recipient of such a gift.
Use your Christmas gifts cards soon or you may not be able receive full value later. Last year, more than $26 billion was spent on gift cards. Also, last year, consumers lost about $8 billion on cards that expired or were not used. When a card is not redeemed for one reason or another, it is called “breakage.”
Home Depot claimed $43 million in profit for gift card “breakage” over a three year period of time. Last year, Williams-Sonoma Inc. gained an additional $12 million for unredeemed cards. Consumer Reports conducted a survey which indicated that 27 percent of those who had received a holiday gift card last year, had not redeemed them.
Perhaps you are in that group. I know I’m guilty. I’ve been known to hang on to a card thinking, “I’ll wait until there is something very special that I want.” Into the dresser drawer the card goes for safe keeping. Several months later, I’ll run across the card in the corner of the drawer… only to put it back in the same place. “I’ll wait until there is something very “special” that I want.” For some reason, I never find that “special” item. I’ve discovered cards that were several years old… still waiting for that “special” purchase. Sooo… I’m one of those 27 percent who have added to the profits of companies without a fair exchange of product.
If your gift card is unredeemed in a matter a few months, some companies impose a service fee. In other words, for every month you do not redeem the card, a percentage of the card’s value is deducted. If you wait too long, your card may not have any value because it has expired.
Some state legislatures are stepping in and passing laws that are requiring companies to display the expiration date on the card. Illinois and New Mexico recently passed laws requiring a card to last for five years before expiring. More and more states are jumping on board to help the consumer come out on top.
It has been reported that retailers such as Barnes & Noble, Blockbuster, Kmart and Toys R’ Us have dropped expiration dates and service fees on their cards. It’s certainly a step in the right direction. However, it’s really the responsibility of the recipient of the card to make sure she gets the full value of the gift by using the card soon after she’s receives it. It was the intention of the giver of the gift card for you to purchase just what you want.
With what I know now… I’ll not be tucking my cards in my dresser drawer anymore! I don’t want to add to the unearned profits of retailers and I want to be respectful of the giver of the gift by not wasting her money.
P.S. Guess what! Borders Bookstore took my two year old gift card for full value. Thank Goodness! Way to go Borders!