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One black friday season I went in Office Max or Depot and bought 20 $100 gift cards for Amazon because there was a very slight discount. This enabled me to purc

• mlyle 6y ago
  That's not really savings, though, because they need to sell it to Office Max for a price where A) Office Max can pay credit card fees, and B) make a small profit.
  • silverpepsi 6y ago
    Well that was kind of exactly my point. It is in their interest to do gift cards because they don't lose anything or incur a cost on themselves, once someone is locked into a gift card they only gain sales. This is made possible at least in part because they have savings on the credit card cut
    • mlyle 6y ago
      I think you're not understanding me. They have to sell it to retailers for less than they'd get after credit card acceptance. E.g. Apple sells gift cards for $88/$100 to a retailer, who then uses the remaining $12 on transaction costs (including paying their credit card fees) and profit margin. Vs. Apple likely loses ~2% on credit card acceptance-- and gets to keep $98/$100. It's still worth it, because they capture money from last-minute gifts, etc...
      • silverpepsi 6y ago
        Hmmm yeah. Though $88/100 is super unrealistic with margins on electronics of 1-2% Amazon would be taking a loss of what the profit from 10 laptop sales every time they dealt with someone buying a laptop all in gift cards. Or maybe gift cards are so rarely used in this way they write it off with higher margin uses