Judd over at ScripSmart has tackled one of the things I’ve had on my list for a long time but never got around to – compiling information on all lots of individual gift cards. Additional information included in his very useful site is information about gift card state laws, a comparison of state vs Federal gift card laws, and even the ability to track your gift cards and set personal alerts, if I understand how the site works correctly.
Definitely worth bookmarking.
Apparently spammers have set their sites on stealing iTunes gift cards via a phishing scam whereby emails claiming to offer a way to check the balance of iTunes gift cards direct people to a site that looks like an official Apple site, but instead steal the iTunes gift card info so that it can be drained.
Don’t click on links in email, always type the site in to your browser yourself.
Do people really get excited about things like this? I personally don’t buy gift cards for people, so I don’t get excited about a gift card with a custom picture.
GiftCards.com has had the ability for customers to upload custom photos to be made into gift cards for some time, at a cost to the customer. They recently announced that through their new PicPaid program, if someone else uses that image for a custom gift card, the person that uploaded it gets a credit of $0.25.
Not like we didn’t see more of this coming given the huge state budget deficits that exist for most states right now.
While so far the legislation is only a proposal, it is one of the more ominous such unclaimed property policies we have seen. Under the proposed legislation, gift cards would be considered dormant and be grabbed by the state after only one year. While, in theory at least, if you tried to get the value back the state is supposed to give it back to you, I can think of quite a few ways the state could make this very difficult to discourage people actually getting their gift card value back.
It does like this:
1. Consumer lets card sit in a drawer for a year
2. State grab gift card
3. Consumer tries to use gift card, but it fails
4. Consumer can’t figure out what is going on and issuing company is no help
5. State doesn’t actually make any effort to find the rightful owner of the gift card
And the money is lost.
Isn’t the government supposed to be helping its constituents?
Plastic Jungle is apparently teaming up with Offerpal Media, which offers one form of virtual currency for use in online games, virtual worlds, and social networks, to give people the ability to convert unused gift card balances into virtual currency.
This is a good idea and ultimately offers people more ways to get the most use out of ALL the value on their gift cards.
Colorado Senate bill 10-155, awaiting signature by the governor, would do away with all gift card fees of any kind. Alas, it does not apply to what they call “general purpose” cards, or open-loop gift cards.
If signed, the law would take effect Aug 11.
Some rebate cards, like those provided by Verizon wireless, carry the Visa or MasterCard logo and can be used as credit/debit cards. We just outlined how important it is to be careful with rebate cards as they don’t carry the same safeguards as gift cards and don’t fall under the new Federal gift card rules, but here are more tricks as reported by the WalletPop blog.
Trick number one: Take the card into your bank and attempt to have it turned into cash. Apparently this is allowed on some cards.
Trick number two: Use the card to buy another open-loop gift card, one that DOES have the gift card safeguards.
I’ve made no attempt to hide my prejudice in favor of American Express gift cards lately as they have shown some extraordinary customer service and were the first to do away with monthly fees, but this agreement with National Gift Card to market a corporate volume rewards card seems like s step in the wrong direction. It is no secret that gift card issuers, expecially open-loop ones, are scrambling to find other ways to ring up fees now that the new gift card rules are coming in August. The most common tactic seems to be to offer cards that aren’t classified as gift cards and so are not beholden to the gift card rules under the Credit Card Reform Act of 2009. This move by Amex appears to be just such a tactic.
While the rewards cards are offered at a discount to face value, and carry no monthly fees, they expire after 12 months and lose ALL of their value. Seems rather drastic. I would avoid these cards.
Mail-in rebates are what gift cards wish they were. Let me explain.
Anyone who has tried to get a mail in rebate knows that the odds are against you. In fact, only somewhere between 20% and 40% of mail-in rebates are ever redeemed. Now, given that many people don’t bother with the mail-in rebate, that number is artificially low. But, as I can attest myself, it is extremely difficult to get your mail in rebate back, for a number of reasons, including the fact that it may just never show up after you’ve mailed it in, or you send the wrong part of the packaging to claim it, or the paperwork is filled out wrong in the smallest of ways … you get the idea.
Well, companies that offer rebated decided that they liked some of the provisions of gift cards so much they started offering rebate cards instead of checks. Now, in addition to it being really hard to get your rebate, once you get it, there are even more ways that you won’t be able to spend it. Rebate cards are essentially the same as gift cards except, since the government considers it free money, rebate cards DO NOT fall under the gift cards rules – pretty much any of them.
So, if you do get a rebate card, here are some tips to getting the most out of it. Probably the best tip is SPEND IT IMMEDIATELY! Here is an excellent blog called RebateRemedy dedicated to getting the most out of rebates.
I’m not sure the history of the laws around gift card fees in Hawaii, but, in a move that seems contrary to the trends in legislation both at the State and Federal levels, Hawaii’s legislature voted to approve the charging of fees, up to 10% of the gift cards face value with a maximum of $5, when a gift card is issued.
Most closed-loop store gift cards (Target, Wal-Mart) do not charge fees when gift cards are issued. Most open-loop (Visa, MasterCard) gift cards DO charge fees when the cards are issued. Perhaps prior to this law these fees were somehow not allowed in Hawaii. As to why the legislature would vote to weaken a consumer friendly law, I am baffled and the comments on the story are very against the move.
Plastic Jungle has announced plans to work with retailers to give gift cards issued from one retailer the ability to be used at others. For instance, you would theoretically be able to use a Wal-Mart gift card to purchase something online from Target.com, although both companies would have to agree to this.
The move would be heavily dependent on signing up retailers to participate, and there is not necessarily a benefit to retailers doing so. Retailers get quite a benefit from holding the cash represented by gift cards (they get to use that money for free until the gift card is spent), often times gift cards go unspent and the company keeps the funds (unless the State grabs it), and gift cards have the additional benefit of usually causing consumers to spend more than the face value of the card when they are in the store. So, why would a retailer allow their gift card to be spent at other locations? The proof is in the pudding, so we will have to see how many retailers sign up for this service.
California is considering raising the amount of money consumers can demand in cash from a gift card from the current level of $10 to “under $20.”
Cardhub.com, a gift card buy/sell/trading site, has launched a new social network-linked gift card exchange to allow people to buy, sell, or trade gift cards without the overhead involved in using a service. Why is this better than Craigslist? The idea is that with access to the other persons social network profile (aka Facebook), people can feel more comfortable doing business with them, versus some random person they might meet on Craigslist.
The latest Postal Service employee charged with stealing gift cards from the mail is believed to have stolen as many as 1,200 gift cards.
The best tip we can give you is DON’T SHIP GIFT CARDS THROUGH THE MAIL! But if you do have to, don’t make them look like greeting cards with a gift card inside, which can be easily felt from the outside.
New Jersey is the latest state to go after gift card funds under the authority of unclaimed property laws, with a twist; they want to actually take possession of the money spent on gift cards when the cards are first purchased, so that the State, and not the issuing company can benefit from the interest and other benefits of holding that money until it is spent, as well as end up with the value on gift cards that is never spent (i.e. the unused property law aspect).
However, the numbers reported don’t make a lot of sense:
Eristoff said the state currently collects money on unused money orders and travelers’ checks. He said the administration expects to collect $85 million in 2010-11 and make $135 million that can go to help finance the government.
Obviously they can’t make more money than they collect, although numbers like that are quite consistent with how States and the Federal government seem to do their books these days.
Google trends is great for tracking the frequency of search terms over time. Reports from industry analists put gift card sales down only moderately (5%) for the last two holiday seasons, but searching Google Trends for “gift cards” gives us a different picture, with traffic declining what appears to be about 30-40% from the peak on 2007:
The search term “visa gift card” seems to have suffered even worse:
The concept of selling unwanted gift cards however, has gone from non-existent in 2006 and continues to grow:
I recently reported on Frendgiftr and GiftCardMall.com, both of which are convenient because they have a large number of gift cards available in one place. Today I came across this site, snapgifts.com, which carries lots of different gift cards and appears to have quite a few more (750 different retailers) than the other two. If the convenience of buying just about any gift card from one place, saving you the trouble of visiting the stores directly to purchase gift cards, this seems to be the place to go. The convenience will set you back a $2.95 shipping and handling fee per card.
The process of adapting to limits on fees has begun, such as the Valley View Mall’s gift cards, which no longer have expiration related fees, but now cost more when you purchase them.
Another interesting fact about this particular mall’s gift cards is that while the previous ones were American Express branded, they could only be used at mall stores. The new ones can be used anywhere an Amex card can be used.
The Wikipedia page on gift cards has some interesting factoids:
1. Gift cards are the most highly wanted gifts by women but only the third highest by males
2. Gift cards ranked as the second most given gift by consumers in the US in 2006.
3. The US is WAY more gift card crazy than our bretheren in Canada or the UK. While the gift card market is quoted as $80 billion in the US, Canada comes in at $1.8 billion and the UK at $8 billion.
Holy cow! This article claims that 33% of Australian gift card go unredeemed. While that figure is for the number of gift cards sold, apparently it represents the value that goes unredeemed as well.
What is curious though is that the article (entitled Profiting from Expired Gift Cards) is for merchants and touts the benefits of selling gift cards as a way to make more money.
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