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183 Comments
- billisdog, on 10/12/2007, -4/+137@Otto:
Does that work pretty nicely when you never get another gift from them again? - BadassCheese, on 10/12/2007, -55/+160Cash isn't a gift. It's like a "you're poorer than me" gift, but a gift card is a legitimate gift. It even has gift right there in the name.
- SourWorm, on 10/12/2007, -33/+136@BadassCheese
Way to play right into the hands of the corporations. Precisely what they want you to do. - ChaosIncarnate, on 10/12/2007, -34/+131@BadassCheese A gift card says "I didn't think to buy you anything so here's something worth less than money that can only be used at one store." Personally I take gift cards as an insult and would rather just get the money that went into buying them.
- BobMysterioso, on 10/12/2007, -2/+82You know, I may be "playing into their hands" but its not that easy to buy for a guy I never see.
My brother in law is super religious, and he seems to like to buy dvds and other things at Best Buy. Personally, I only buy at Best Buy when its a pretty decent deal, with no rebates, and its something I might need to return, or I want/require it that day. Although the new Magnolia Home Theatre carries some much better equipment than the normal consumer level crap. But I digress.
So I got him a $30 gift card. I don't care what he does with it. He can do nothing with it forever as far as I'm concerned. He is expecting a gift card, he doesn't want cash and I don't blame him. Cash is a dilemma really. You're giving money, but its not purposed. So that person may very well not spend it on themselves, but rather on bills or an oil change or something like that. With a gift card you're giving that person something, or a part of something, in that store. There is a pretty decent difference there. The only gotcha is gift cards to places you never shop. Then, you'd just rather have cash. - sardion2000, on 10/12/2007, -8/+67wow, I hope none of you jerks gets a gift card this christmas. bunch of ungrateful *****.. "sorry but I only take cash" "No thanks I don't want to be a tool of the Corporations even though I spend money at corporations and am already a Tool for different reasons" etc etc
- FreakTrap, on 10/12/2007, -4/+58The reason I purchased gift-cards for a few few family members is simple:
I can't afford to buy my sister a 80gb iPod, and she doesn't really want a cheaper alternative. I know she intends on buying it at best buy rather a cheaper online store, and I know that she is having a less-than-easy time being a college student [just like myself] that has to pay for her own rent and bills. So, myself, and a few other family members are all pooling together to get her gift-cards to pay for the iPod.
Why not give her cash? Well, if the sum of the gift-cards can't pay for the iPod, then she will hang on to them until she can afford the other $50.00; however, had we given her cash, chances are that the cash would end up being put into her checking account, then liquidated into paying bills. - Blizaine, on 10/12/2007, -4/+43I love gift cards. Sometimes I'd rather be forced to buy something from Best Buy. Otherwise, if someone gave me cash, I would use it on food or something.
- GliTCH82, on 10/12/2007, -10/+41So true, it's right up there with mail-in-rebates. You'd be surprised how many are enticed enough by one to make the purchase but lazy enough to never fill it in and send it back, resulting in massive profits for a retailer. Neither are really a scam, but definitely tools used by companies to exploit our lazy lifestyles.
- cards, on 10/12/2007, -1/+25I don't like Best Buy either, but I don't think you can blame them on this one. Gift cards fill a demand customers have created. It's not their fault customers forget/choose not to use the gift cards they receive.
- jiminoc, on 10/12/2007, -2/+26I believe in california it's a law that you can't make gift cards expire. I'm sure it's due to ***** like this. Best Buy has some really ***** tactics nowadays. I haven't shopped there in a while because of it.
- IEatHamburgers, on 10/12/2007, -6/+28It's probably idiots buying $10 gift cards - it's an electronics store, what the hell are you going to do with $10?
- mecole21, on 10/12/2007, -2/+23maybe if people weren't idiots and actually used the gift cards after they got them, they wouldnt go bad... what i'm wondering about is how much of that is cards that were used but only have like 3 cents left on them...
- david76, on 10/12/2007, -1/+22Unfortunately, GAAP (Generally Accepted Accounting Principles) states you cannot recognize revenue on unredeemed gift cards.
"If you are following Generally Accepted Accounting Principles (GAAP), gift card revenue is only recognized when the card is redeemed for merchandise or a service." - http://www.ernex.com/newsletters/2006_10_feature.asp
I don't know what accounting standards they're following, but unused gift cards do not contribute to revenue from an accounting perspective. This is even disclosed at the bottom of the article. So in that sense, the article is somewhat misleading. - tvc15, on 10/12/2007, -8/+28@billisdog
"Does that work pretty nicely when you never get another gift from them again?"
Not that I would be as 'direct' as Otto but...
I would love it to never get a 'gift' again. Most gifts as practiced in our (or at least my) culture aren't real gifts. They are obligations which beget obligations. A real gift is something given with nothing at all expected in return. Ever. If you give something to someone and get hurt that you don't get anything back... that's not a gift. As a corollary, things given around traditional gift giving times (end of year, birthdays, etc) are ambiguous even if you mean them to be real gifts. People might think they need to get you something back in return. The safest thing is to give things to people well away from these times. - RockMyMonkey, on 10/12/2007, -29/+45Gift cards are a scam! If only they let people cash them out.
- jpmoney03, on 10/12/2007, -0/+16That's the bigger way they make money off them. You get a $10 gift card and spend $75 or more out of your pocket in order to use it.
- jrapp, on 10/12/2007, -0/+12We have that here in Nebraska as well - however, many companies will charge a monthly service fee to the card after it's been used if you somehow happen to not use all of the card up at once.
- ThrobbingBrain, on 10/12/2007, -0/+10For all those reading this that haven't used their Best Buy gift cards, send them to me and I will put them to good use. I promise.
- Whackly, on 10/12/2007, -0/+10Um... buy something.... seems obvious. Personally I'd rather have gift cards in a lot of cases. I'd rather buy what I want than have to return something that doesn't fit or is not my taste. I wouldn't buy a gift card for my Mom or my Grandma cause they are looking for something "from me" and they don't care what it is. I would prefer that they give gift cards to me, however.
- MrMysterious, on 10/12/2007, -1/+10It's not that they are expired, it's that Best Buy figures if someone hasn't used a two year old gift card then they are never going to use it.
I used to hold onto my gift cards but now I redeem them right away since I'm afraid of making it $43,000,025.00 for the year. - AriaStar, on 10/12/2007, -0/+9In California, gift cards do not expire. They are cards that basically indicate a deposit with the retailer. Since cash has no expiration date, neither do the cards.
- inactive, on 10/12/2007, -4/+12You guys are unbelieveable. Gift cards are "scams" What the *****? Your lives are so devoid of fun that you think everyoine is out to get you? Just sad.
Gift cards are fine. Sure, you don't give your girlfriends (some people have girlfriends, diggers) one. But if you are giving presents to people that you normally don't see very often, they are fine.
To the idiots saying "Would you rather have cash", well you see, once you mature past the point of a 13 year old, cash is not an option. So, that is out. Now your choice is, would you rather have a gift card that can be spent on anything you want, albeit at a particular store, or would you rather get something that someone who barely knows you THINKS you may want, meaning that chances are you will have to return it, and since it was paid with a credit card, most likely STILL have to only get something at that one store?
Most people who get gift cards get them because they ASK for them. They know that the other person doesn't know their tastes but at the same time don't want cash. (Again, because they have matured past that of a 13 year old.) - crash2005, on 10/12/2007, -0/+8The Law to this already Passed... Its Now Illegal in Ontario-Canada to have expiry dates on Gift-cards
- elitexero, on 10/12/2007, -0/+7If you get a gift card you don't like, find someone who shops at the store and sell it to them like 5$ off. Or ebay it. It's really not that big of a deal. A gift card says "I put thought into your gift, I didn't just go damn, 'X' needs a gift, heres 20$"
- MrMysterious, on 10/12/2007, -0/+7Darkdaedra, in my wallet I have a Best Buy Gift Card its says:
"No Expiration date, no fees" - RegisteredUser, on 10/12/2007, -3/+10Forget store gift cards. I think those pre-paid Mastercard or Visa cards are the best way to go. This will allow the gift receiver to spend it at more places. They can even use it to buy groceries or gas or other essentials.
- CornStarch, on 10/12/2007, -1/+8That is why I like the way Friday's does gift cards, you buy one and get 5 bucks for yourself. There should be no excuse for not getting a discount when you buy a gift card.
- mrswirl, on 10/12/2007, -0/+7@Future2
"My RDO told me that 50% of all gift cards sold are never redeemed. He said selling gift cards was like printing your own money. This is why every store in every line of business has a ton of POP trying to trick you into buying a gift card for that someone special."
And 72% of all statistics are made up on the spot.
-Your RDO is absolutely wrong. The vast majority of GCs (upwards of 90%) are redeemed within the first 30 days. The reason companies offer GCs is because of the consumer demand. They are very lucrative to the merchant but mostly because the average person will uplift the sale by a healthy percentage when using a GC than with cash or credit.
By uplift, I mean most people who go in with a $20 GC will buy $30 worth of stuff. The additional $10 is called 'uplift'.
The other revenue generator is the float that the merchant gets to keep from interest made on the money stored in the value of the cards.
TFA mentions "unused" GCs which by most state laws, means the merchant can only claim the money as abandoned property after a certain period of time of inactivity. The unused money can sit in the merchant's bank account gathering interest until used or abandoned. Most state abandonment laws take effect after 2 years which is why you see most GC expiration dates right at around the 2 year mark.
While most companies have done away with GC expiration dates (by law), this doesn't change the abandoned property statute at all. This means that instead of the merchant getting your unused money, the state government has a shot at it first.
Service fees (amounts deducted after a period of inactivity) are usually imposed by merchants who desire to decrement the balance of unused GCs prior to it going into the abandonment stage since claiming abandoned property is a huge pain in the ass. Basically, the government gets it first then you have to get it back from them (minus a healthy amount of course.)
The bottom line for everyone to know is that you only have yourself to blame if you don't use the entire balance on a card. It's not a secret conspiracy by companies to screw you. It's the same thing as you dropping a quarter on the floor and not bothering to pick it up.
(Digg me down for telling the hard truth if you want to. I know this stuff because I worked for one of the largest GC providers in the US). - nick0909, on 10/12/2007, -0/+6In California your gift cards can't expire, its the law. If they tell you they are expired, tell them to get the manager and they will make the card work (happened to me once). If your gift card only has 46 cents or some measly amount on it that you will never come back and use, turn around and give it to the person behind you in line. Sure it doesn't mean much, but its kinda fun to do because people these days don't give anything to anyone. Give someone half a dollar and it changes their whole day. Sad but true.
- jerbaker, on 10/12/2007, -0/+6Doesn't matter. All the ***** places do is refuse to give you change even when there's like 5 *****' cents left on the card. I save them up and then pay with 20 or so cards each having less than $1 balance. Sometimes the cashier complains that they can only take three cards, but I make them get a manger and explain that if their policy not to give change ever, then they're going to have to accept all of their 10-cent cards.
- LeroyBrown, on 10/12/2007, -2/+8I personally love gift cards. If someone gives me cash, I'm more likely to spend it on non-gift related things.
If somebody gives me an actual gift, it's likely to be something that I don't want and will never use.
Also, I can add small gifts together to form a big gift. Do I want 10 fruit-cakes, or 10 $20 best buy gift certificates?
If you don't spend your Best Buy gift card over the course of 2 years, then I'm thinking you can afford to donate to the Best Buy charity. - LanMan66, on 10/12/2007, -0/+6@IEatHamburgers:
No one said you can ONLY buy things equal to or less than your gift card amount. What would you do with a $10 gift card? Ummmm....get a $10 discount on an item that you've already been looking at purchasing anyway? - capran, on 10/12/2007, -0/+5...you could have just ordered a GC on the store's website and had it mailed directly to the recipient...
- ynggrsshppr, on 10/12/2007, -1/+6Yes, but somehow corporations have managed to make gift cards seem less tacky in comparison.
- tdogg241, on 10/12/2007, -2/+7Typically, if a giftcard balance drops below a certain amount (usually $1), they will give you the remaining balance in cash.
- darkdaedra, on 10/12/2007, -3/+8Actually, they do expire. The laws are as follows:
Expiration dates do not apply in California, Connecticut, Maine, Montana, Rhode Island, and Washington. Expiration date applies in New Hampshire only for gift certificates more than $100. For the following states, a gift certificate will expire after the indicated period of time as measured from the date of issuance: Louisiana (5 years), Maryland (4 years), Massachusetts (7 years), North Dakota (6 years), Oklahoma (5 years), and Vermont (3 years).
All other states' cards expire whenever the seller of the gift card wants them to. - zoom1928, on 10/12/2007, -2/+6From my experience, most of the profit is from cards that they refuse to honor. Two years ago I gave twenty-four $50 Best Buy gift certificates to employees. More than half of them were not allowed to use the cards. I know the one time I tried to use a $10 card someone gave to me that they lied and claimed the card was too old to use. I sent eleven of the cards to the state AG's office with a complaint. Of course I haven't heard back from the AG's office. The previous AG nailed Best Buy for lying on prices in their sales ads, but the new one allows Best Buy to lie now so I doubt the new guy will do anything. It's amazing how every single Sunday ad in the paper contains prices that Best Buy will not honor, but the state AG's office will no longer do anything about that.
So why are you blaming the victim? Why call someone that gets ripped-off by Best Buy an idiot? - stauffere, on 10/12/2007, -3/+8I used to work for Best Buy and can tell you that the gift cards do not expire. I would think that a lot of the profit came from people who had a couple of dollars left on a card and forgot about it.
- mayna, on 10/12/2007, -0/+4@miketootall
Usually there's also a number that they type into the cash register, if the magnetic strip doesn't work. I have had gift cards lose their magnetic strip but was able to redeem them. - NCC1701A, on 10/12/2007, -1/+5Yes, Gift cards and Certificates with expiry dates are a SCAM, the worst kind of scam, one perpetrated by companies we trust. Gift cards and Coupons should NEVER, EVER expire!
Why have an expiry? well obviously to keep the money - Profit - Pure and simple. There is no technical reason or accounting rules that forbid a card from being usable FOREVER! As a mater of fact, I give Certificates from our Empire Theaters away at X-Mas, no expiry they are good forever.
At a minimum, They should be forced to give the un-redeemed money to a Charity including accumulated Interest.
And they should be redeemable in Cash - I suppose You could buy something and then get a refund on it.
I hate Rebates and Certificates.... - griz, on 10/12/2007, -0/+4Same in New Hampshire. I think this should be the case everywhere. How exactly does a store every have a right to not accept the gift card? You gave them the cash, they have likely even earned interest on it while the stock sat in their warehouse. It's pure corporate greed if they don't honor it anytime.
- davidsmero, on 10/12/2007, -2/+6BestBuy giftcards are the biggest scam ever. No matter what the balance is on the card, you can never cash it out. So if you make a $29.79 purchase with a $30.00 giftcard, that 21 cents is still theirs. Most people wouldn't even bother and throw the giftcard away. So it's profit for them. It really adds up.
- Lain1k, on 10/12/2007, -0/+4Why does everyone think it's bad to get money and then spend it on gas/food/bills? I rather use money to pay for that stuff, it means I have more money to do what I want during the month. Those things stop me from going to the movies, eating out with friends, getting that game I wanted because I need the money. But if I have extra cash and it ends up going toward gas/food/bills then I will have extra cash in general for entertainment.
Gift cards work for the predictable, but I think they are a crappy gift for geeks.
Regardless I am grateful for any gift. - Kazaki, on 10/12/2007, -0/+4THERE IS NO EXPIRATION ON BB GIFT CARDS.
This article is not attacking BB for making a profit. This article is attacking the idea of gift cards. - inactive, on 10/12/2007, -0/+3I'm not sure if this goes for all the Barnes and Nobles, but the one I shop at if you use a giftcard and it goes under $5 and there is still money left on it, they give you the remaining balance back in cash. Wish all/more places were like that.
- blinkfink182, on 10/12/2007, -2/+5What everyone is failing to realize is that these cards don't lose value over time, so the only reason that there's ANY profit on gift card sales is because people forget about/lose/trash them. No ones fault but the consumer. If my gift card only has $.21 left on it, damn right I'll use the $.21. Someone paid that money, and I'm going to use all of it.
- madrox, on 10/12/2007, -1/+4id rather get cash and use it on food and gas then stupid candles or clothes I'll never wear or some knick knack that will most likely never leave the box much less get used. I've tried to talk my parents into canceling xmas for years, but to no avail. I'd rather we all pool our money and spend it on some fantastic dinner with some wine and enjoy the company of the family as opposed to dealing with the malls and stores and retarded masses that flood them both.
- ICSU, on 10/12/2007, -6/+9If you don't like gift cards, send them to charity. Oh wait, you want cash.
- LiquidPenguin, on 10/12/2007, -0/+3Home Depot does a similar thing. Recently, they enabled a method to, at the very least, disable missing or stolen Gift Cards _if_ you have the reciept. However, if half of that 10,000 GC was spent before you went to the store to disable it, you're SOL on the spent portion. It also doesn't address the problem of the real owner losing his/her reciept and some Joe picking it up and realizing what they can do with it. Linger outside the exit door of any major retailer, you'll be surprised at how many reciepts you'll find.
Home Depot has gotten really chintzy with their employees. Where before you would have recieved a check for your Christmas bonus, you would be lucky to recieve a $50 Gift Card of any type. They also tend to do the most of their hirings and firings in the three months leading up to December (and the semi-fiscal year) to avoid paying out bonuses even when they did. -
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