Here’s another reason not to give gift cards or certificates as presents this holiday season (or any other time). According to estimates by TowerGroup, $8 billion was lost by consumers last year who let their gift cards go unused — expired, lost, or ignored.
Consumer Reports also says that their latest survey shows that 27% of gift card recipients have not used at least one of the cards received. That’s up from 19% the same time last year.
From the company’s perspective, issuing gift cards is a great idea. They receive cash from the purchase of gift cards, but if the cards are never redeemed, they don’t have to move any inventory. From the consumer’s viewpoint, receiving a gift card as a present doesn’t reflect any of their own expenditure, so perhaps people don’t pay much attention to their expiration or loss.
What do you think about gift cards? Do you give them to others as presents? I do sometimes. For example, a coworker recently looked after my cat while I was away, with no expectation of something in return. I felt the right thing to do would be thanking her with a small gift. Now that I know her better, I know of some specific things she would enjoy. At the time, however, we had discussed the new Target that opened nearby. I knew she would be shopping there, so I presented her with a Target gift card. If I didn’t know there was a very strong possibility of her visiting the store in the near future, I would not have taken that path.
How about you?
Avoid gift card pitfalls [Consumer Reports]
Image credit: spike55151
Updated August 9, 2011 and originally published November 12, 2007.