15 ms·

More than you want to know about gift cards

210 points by smitop 5y ago

pavon 5y ago
Does anyone have an example of what he refers to as an open-loop gift card? Is is the same thing as a prepaid debit card? Are there other types?
- flh 5y ago
  Yes a prepaid debit card is a type of open-loop card. The two main types of open-loop cards in this industry are prepaid gift cards and reloadable prepaid debit cards. You probably see the gift cards all the time if you live in the US, they are often on an endcap near the front of grocery stores and pharmacies. Once the funds have been fully debited from the gift card account the card can't be used again, and these also expire after a few years if they aren't redeemed. Reloadable debit cards are basically a simplified bank account often used by the underbanked or for people who may not want to use a debit card tied to their bank or a credit card for whatever reason. For the most part folks can use these products to make any purchase that one could make with a normal debit or credit card, but there are some exceptions to that. I think most of the streaming services don't accept them, and probably many other subscription based services that use periodic charges to an account.
LgWoodenBadger 5y ago
IME, a gift card is a nice/friendly way to push a frugal person to spend money on themselves that they wouldn't do otherwise. If it's cash they'll just deposit it. If a gift card they might actually buy themselves something.
- adamddev1 5y ago
  Yes, this exactly. I'm surprised more people aren't thinking of this. Gift cards are nice because it kind of allows/forces you in a guilt-free way to relax and spend something at a certain store rather than just being cash that you feel you'd have to decide how to use it in the best way.
pezzana 5y ago
> Personal financial columnists and comedians do not understand the jobs that gift cards do. They are not cash-but-worse-in-every-way. Closed loop cards allow a giver to personalize a gift to the recipient. A Barnes and Noble gift card to a favorite niece tells that niece that you remember she is a reader, unlike those uncreative family members who would just give her cash. The article doesn't actually explain the job being done by gift cards. The job is the one the giver is expected to perform: the ritual of gift giving. The gift card is hired by the giver for that job. But how did the giver get this job? Far more interesting than the mechanics of gift card management would be an exploration of this ritual. Where does it come from, and why has it morphed into the economically-essential activity that the former religious holiday of Christmas has become? Are gift cards the last stop before the holiday returns to its roots, or will the next phase become even less recognizable?
- mc32 5y ago
  The one advantage of cash and cash equivalents (open loop) over closed loop is that the recipient can decide what they want to spend their money on. Maybe I have enough books for now but do need a pair of shoes.
  - pavel_lishin 5y ago
    Or maybe your niece is boycotting B&N for some reason, or knows a much better, cheaper bookstore to shop at.
    - handrous 5y ago
      One thing that drives me nuts, when I give in and produce a list of stuff I'd kinda sorta like for the various relatives requesting such and, inevitably, most of it's just books, is that no one will buy them used. I tell them to, over and over, but they won't do it. I'd rather receive the same number of books and know they spent less on them. Or 3x as many books for the same money. But no. They just won't do it. Then again, I think toys should be removed from their store packaging before being wrapped, but I always lose that struggle, too. People seem really stuck on only giving visibly-new things. I suspect there's some Fussellian class-analysis to be done on that behavior.
tiffanyh 5y ago
> "Open-loop gift cards are issued under the aegis of a payments network, like Visa or American Express" It's ironic that Amex is used as an example given that they are a closed-loop network.
- fragmede 5y ago
  I can spend an Amex card at any retailer that takes amex, vs my Best Buy gift card is only usable at Best Buy. In what way is Amex a closed-loop network?
  - tiffanyh 5y ago
    When it comes to the network, a closed-loop network refers to the fact that the network operator is also the issuing bank (e.g. Amex, Discover). Open loop networks, the network operator is not the issuing bank (e.g. Visa, Mastercard). Patio11 is correct in that from a gift card usage perspective, Amex is open loop. But I'm just pointing out that from a network perspective, they are not.
winternett 5y ago
I still don't understand why it faux-pas to just put cash in a nice card... I just do it anyway. It's a more universal gift card without fees and expiration dates... Anyone who tries to put me down for doing so will simply not be receiving a gift from me next year... Screw stressful stores. plastic cards, and standing in line, my method is much more "green"... :P
- a4isms 5y ago
  “I think a gift card is a bad gift. You take money that is good everywhere...” (long pause, punctuated by applause and laughter) —Mitch Hedberg, 1968 - 2005
- hamandcheese 5y ago
  Is it? In my family it definitely isn’t.
  - ncpa-cpl 5y ago
    My family accepts cash and equivalents for Christmas. The past four Christmas I've sent bank transfers on the 25th. Shopping malls, ATMs and banks get just too crowded those days.
  - mixmastamyk 5y ago
    Probably some trade consortium trying to convince you that cash is looked down upon. I've yet to meet a younger person who didn't appreciate "cold hard cash" in a card, a la Lucy Van Pelt.
  - TigeriusKirk 5y ago
    We make the same "hope it fits" joke every year and everyone still smiles, so I guess it works fine.
- lhorie 5y ago
  In chinese culture, it's a pretty normal thing to give red envelopes with cash inside[0] [0] https://en.wikipedia.org/wiki/Red_envelope https://en.wikipedia.org/wiki/Red_envelope
wodenokoto 5y ago
> employers to offer a gym stipend instead of the equivalent amount of salary Isn't that partly tax benefit and partly the hope that steering employees to better health, results in better employees? E.g., for 20usd I can give them 16usd cash after taxes (or whatever) or 20usd worth of gym membership AND I'd rather my employee exercise than spend money on candy. > A Barnes and Noble gift card to a favorite niece tells that niece that you remember she is a reader, unlike those uncreative family members who would just give her cash. My first thought was, as others have mentioned too, "buy a card and give cash", but the thoughtful card costs money, so the recipient pays through poor convenience for the cost of the paper card, instead of the giver spending money on the thoughtful presentation.
- Cerium 5y ago
  The company gets not just better employees, but marginally cheaper ones. Healthier employees reduce health insurance premiums for corporate group plans.
- deleted 5y ago
  [deleted]
- junar 5y ago
  At least in the US, the gym has to be exclusive to employees and their families to qualify for a tax benefit. > You can exclude the value of an employee's use of an on-premises gym or other athletic facility you operate from an employee's wages if substantially all use of the facility during the calendar year is by your employees, their spouses, and their dependent children. For this purpose, an employee's dependent child is a child or stepchild who is the employee's dependent or who, if both parents are deceased, hasn't attained the age of 25. The exclusion doesn't apply to any athletic facility if access to the facility is made available to the general public through the sale of memberships, the rental of the facility, or a similar arrangement. https://www.irs.gov/publications/p15b#en_US_2021_publink1000193657 https://www.irs.gov/publications/p15b#en_US_2021_publink1000...
airstrike 5y ago
Conversely, here's really "All you need to know about gift cards": think about the interest being generated from all that cash sitting idle on some issuer's account while the recipient of your gift card decides how to spend their money. > Most retailers do not have sufficient gift card liabilities and do not have sufficiently sophisticated treasury teams to make a meaningful amount of income off an investment portfolio. This assumes that the retailer is the one holding the cash and not the issuer of the card. I'm by no means an expert in the industry but IIRC there's a whole lot more that goes into this than the author implies. > Also, they have a much better option. Unlike insurers, who must maintain reserves by regulation, most businesses issuing closed loop gift cards are not required to maintain reserves. They can simply use the cash as a source of working capital for the business, similar to other sources of working capital, except substantially free. Even in a capital-drenched economy, it is tough to beat free. Agreed, except it would be much better for it to be either me or my recipient who benefits from said "free money".
- mistrial9 5y ago
  yes, the article mentions coupons briefly, which are ancestors and a very large topic. Diligent literature search turned up very little. The way the money is actually handled is trade secret it seems. This is a very old aspect of money handling in retail.
- brewdad 5y ago
  My brother gifts us AmEx gift cards every year. I think he gets them at a discount so it does allow his gifting budget to go further but they are a pain in a-- to use. Unlike a store gift card, they are almost impossible to stack with other payment methods (at least online). Additionally, the test charges a store does to ensure the card is valid places a hold on some of the funds of the card (typically a dollar) making it virtually impossible to use all of the funds on the card. Typically, I end up adding them to my Amazon payment methods and buying an Amazon gift balance to myself and toss the remaining $1 of value in the trash. I also end up "buying" the gift cards from my wife and son since I'm the only one with the patience to deal with them, so at least we get most of the value off of them rather than letting them expire. It's now 12 days until Xmas and I finally spent us down to only $11 left from last year's cards.
throwaway413 5y ago
Idea: “unlocked” public bitcoin wallets with autogenerated key pairs that can be given to someone without them needing a pre-existing wallet. 1) transactions are instant and free, ie giving over physical ownership of a pub/private key pair (this could be done via scan of a QR code) 2) no prior onboarding necessary (avoids the repeated question “do you have this wallet/app?”) Before, if I didn’t have cash, to tip a valet I’d have to ask them “do you have Zelle or Venmo?”, then I’d get their details, then send them money. Here, I could just pull out my wallet, create a new wallet with the specific amount, show them the QR code and say “scan this and it’s yours”. Basically bitcoin gift cards without the store-specific lock-in.
- agentdrtran 5y ago
  transactions are very much not free when paying with bitcoin, and this has been tried in a few forms already but none have been successful. how can they spend what you give them? are you going to sit there and explain bitcoin to the waiter?
  - throwaway413 5y ago
    Let me clarify. Yes, you have to pay transaction fees when transferring money on the blockchain. I am proposing that no transaction would occur. Just like when you hand cash to someone, no external transfer needs to take place. You would essentially be giving them full access to said wallet, and giving up ownership. No transaction would need to be recorded to the blockchain because no actual wallet transfer would take place. Only the immediate physical ownership of the keys which could happen offline, instantly, etc. The rest of your questions are not answered so easily, and agreed, this still doesn’t answer the issue of onboarding to crypto in general. What it does solve though is the necessary onboarding to creating a wallet and understanding how to receive bitcoin. No one needs to “understand” how to receive cash. You stick your hand out and receive it. Should be just as easy as that with bitcoin.
- mattnewton 5y ago
  Wouldn't your valet example be even easier with venmo? Or is it because the money has a QR code instead of the account - that could easily be done with venmo, but isn't, it's true. With crypto I worry about the transaction costs dwarfing the utility of something like this. Without a central exchange avoiding fees for the tiny movement of crypto, you'd lose too much in transaction costs when setting up a new wallet to give away. But if you have a central exchange running it anyways why not just expose this UX over an existing cnetralized payment system like venmo?
dwighttk 5y ago
> it’s very tempting for a payments geek to wax laconic about… That’s a novel use of laconic to me. Maybe he meant lyrical?
- jrochkind1 5y ago
  indeed, it's kind of an oxymoron!
- gifnamething 5y ago
  Sounds OK to me. I could imagine 'gift cards are just interfaces', which is laconic, among other adjectives.
  - dwighttk 5y ago
    If so it is a novel use of “wax” for me.
tfang17 5y ago
If anyone is looking for a gift card provider to send gift cards via email, try out Tremendous! We use and love them. Nice APIs and super simple to integrate.
bedhead 5y ago
My theory on gift giving is to get the person something they probably want but normally wouldn't, for whatever reason, buy themselves. Like a nice bottle of wine, a lot of people would love it, but would also feel silly spending money on it. It's obviously not always that easy to do this but anytime you can I've found it goes over really well. And yeah, it usually involves kinda silly luxuries like wine.
agustif 5y ago
Would you people gift something like an expensive cruise travel package in a gift card?
makecheck 5y ago
Gift cards are the ultimate anti-consumer scam: - If you buy a gift card that isn’t worth enough for what you actually buy, the store “wins” because you will probably make up the difference with cash and they then sell you something you either would not have bought at all, or bought somewhere else. - If you buy a gift card that is worth more than whatever you end up buying, the store “wins” again because they have received the full value and you did not. - If you buy a gift card and by some miracle it is exactly matching the cost of what you buy, the store “wins” yet again because (a) you were still only able to purchase items from that store, and (b) the entire time you were holding the card, it was slowly losing value because only bad things could have happened: the store might have stopped offering what you wanted, the price could have changed, or heck the store could have simply gone out of business. Meanwhile, the store was already paid by you for the card (in yesterday’s dollars) so they could do almost anything with that CASH, including putting it in a saving account, and end up better off than you. Simply put, it is never, ever, ever to your advantage to have a gift card. Ever!! Cash is better in every possible way.
- ketozhang 5y ago
  What about credit card rewards that are high in certain types of store (e.g., 6% cash back on groceries)? I don't see how this is more than the consumer getting a product 6% less than what they would initially pay.
- flh 5y ago
  I mostly agree with you, but I don't think most people are buying gift cards for themselves. Why would they when there are activation fees attached to these products? Generally they're given out as kind of a lazy gift among family and friends during the holidays, or somtimes from businesses to their employees. As long as the card is for something mildly useful like Starbucks (Although according to the post this seems to be the one that is actually redeemed the least), or Amazon then I wouldn't be too upset about receiving one. At the end of the day though I'm in the same camp as you when it comes to my own spending. I don't like to give money to anyone for anything less than immediate services rendered.
  - 5y ago
httpz 5y ago
Gifting is much more than just a monetary value transfer from one person to another (unless you're a soulless tax lawyer) and so many people here are forgetting that. I see gift cards to be somewhere between a thoughtful physical gift and a bank transfer. I'd rather give my nephew a $50 gift card to a bookstore than $40 in cash.
- shaklee3 5y ago
  this is pretty much exactly what he says in the article.
boppo1 5y ago
I once worked at a small business, single-location franchisee of a niche brand. I got a pretty good look at our balance sheet a few times and damn it sure looked like giftcard holders owned us. I think that line item was like 70% of our liabilities. equity was tiny. We also sorta ran like shit, which makes sense when you consider those incentives.
dempedempe 5y ago
> A Barnes and Noble gift card to a favorite niece tells that niece that you remember she is a reader Why not just write a note and give that alongside some cash? The only time I buy gift cards is if I can get some sort of a discount. There's no other reason for me to buy them.
susiecambria 5y ago
Over the years, I have given my parents stocking stuffers and a donation to their favorite charity. They buy what they want and so the small items to open are things they will use/make them smile. And the big gift, the donation, does a whole lot of good and we all are happy.

210 points by smitop 5y ago

Does anyone have an example of what he refers to as an open-loop gift card? Is is the same thing as a prepaid debit card? Are there other types?

flh 5y ago
Yes a prepaid debit card is a type of open-loop card. The two main types of open-loop cards in this industry are prepaid gift cards and reloadable prepaid debit cards. You probably see the gift cards all the time if you live in the US, they are often on an endcap near the front of grocery stores and pharmacies. Once the funds have been fully debited from the gift card account the card can't be used again, and these also expire after a few years if they aren't redeemed. Reloadable debit cards are basically a simplified bank account often used by the underbanked or for people who may not want to use a debit card tied to their bank or a credit card for whatever reason. For the most part folks can use these products to make any purchase that one could make with a normal debit or credit card, but there are some exceptions to that. I think most of the streaming services don't accept them, and probably many other subscription based services that use periodic charges to an account.

LgWoodenBadger 5y ago

IME, a gift card is a nice/friendly way to push a frugal person to spend money on themselves that they wouldn't do otherwise. If it's cash they'll just deposit it. If a gift card they might actually buy themselves something.

adamddev1 5y ago
Yes, this exactly. I'm surprised more people aren't thinking of this. Gift cards are nice because it kind of allows/forces you in a guilt-free way to relax and spend something at a certain store rather than just being cash that you feel you'd have to decide how to use it in the best way.

pezzana 5y ago

> Personal financial columnists and comedians do not understand the jobs that gift cards do. They are not cash-but-worse-in-every-way. Closed loop cards allow a giver to personalize a gift to the recipient. A Barnes and Noble gift card to a favorite niece tells that niece that you remember she is a reader, unlike those uncreative family members who would just give her cash. The article doesn't actually explain the job being done by gift cards. The job is the one the giver is expected to perform: the ritual of gift giving. The gift card is hired by the giver for that job. But how did the giver get this job? Far more interesting than the mechanics of gift card management would be an exploration of this ritual. Where does it come from, and why has it morphed into the economically-essential activity that the former religious holiday of Christmas has become? Are gift cards the last stop before the holiday returns to its roots, or will the next phase become even less recognizable?

mc32 5y ago
The one advantage of cash and cash equivalents (open loop) over closed loop is that the recipient can decide what they want to spend their money on. Maybe I have enough books for now but do need a pair of shoes.
- pavel_lishin 5y ago
  Or maybe your niece is boycotting B&N for some reason, or knows a much better, cheaper bookstore to shop at.
  - handrous 5y ago
    One thing that drives me nuts, when I give in and produce a list of stuff I'd kinda sorta like for the various relatives requesting such and, inevitably, most of it's just books, is that no one will buy them used. I tell them to, over and over, but they won't do it. I'd rather receive the same number of books and know they spent less on them. Or 3x as many books for the same money. But no. They just won't do it. Then again, I think toys should be removed from their store packaging before being wrapped, but I always lose that struggle, too. People seem really stuck on only giving visibly-new things. I suspect there's some Fussellian class-analysis to be done on that behavior.

tiffanyh 5y ago

> "Open-loop gift cards are issued under the aegis of a payments network, like Visa or American Express" It's ironic that Amex is used as an example given that they are a closed-loop network.

fragmede 5y ago
I can spend an Amex card at any retailer that takes amex, vs my Best Buy gift card is only usable at Best Buy. In what way is Amex a closed-loop network?
- tiffanyh 5y ago
  When it comes to the network, a closed-loop network refers to the fact that the network operator is also the issuing bank (e.g. Amex, Discover). Open loop networks, the network operator is not the issuing bank (e.g. Visa, Mastercard). Patio11 is correct in that from a gift card usage perspective, Amex is open loop. But I'm just pointing out that from a network perspective, they are not.

winternett 5y ago

I still don't understand why it faux-pas to just put cash in a nice card... I just do it anyway. It's a more universal gift card without fees and expiration dates... Anyone who tries to put me down for doing so will simply not be receiving a gift from me next year... Screw stressful stores. plastic cards, and standing in line, my method is much more "green"... :P

a4isms 5y ago
“I think a gift card is a bad gift. You take money that is good everywhere...” (long pause, punctuated by applause and laughter) —Mitch Hedberg, 1968 - 2005
hamandcheese 5y ago
Is it? In my family it definitely isn’t.
- ncpa-cpl 5y ago
  My family accepts cash and equivalents for Christmas. The past four Christmas I've sent bank transfers on the 25th. Shopping malls, ATMs and banks get just too crowded those days.
- mixmastamyk 5y ago
  Probably some trade consortium trying to convince you that cash is looked down upon. I've yet to meet a younger person who didn't appreciate "cold hard cash" in a card, a la Lucy Van Pelt.
- TigeriusKirk 5y ago
  We make the same "hope it fits" joke every year and everyone still smiles, so I guess it works fine.
lhorie 5y ago
In chinese culture, it's a pretty normal thing to give red envelopes with cash inside[0] [0] https://en.wikipedia.org/wiki/Red_envelope https://en.wikipedia.org/wiki/Red_envelope

wodenokoto 5y ago

> employers to offer a gym stipend instead of the equivalent amount of salary Isn't that partly tax benefit and partly the hope that steering employees to better health, results in better employees? E.g., for 20usd I can give them 16usd cash after taxes (or whatever) or 20usd worth of gym membership AND I'd rather my employee exercise than spend money on candy. > A Barnes and Noble gift card to a favorite niece tells that niece that you remember she is a reader, unlike those uncreative family members who would just give her cash. My first thought was, as others have mentioned too, "buy a card and give cash", but the thoughtful card costs money, so the recipient pays through poor convenience for the cost of the paper card, instead of the giver spending money on the thoughtful presentation.

Cerium 5y ago
The company gets not just better employees, but marginally cheaper ones. Healthier employees reduce health insurance premiums for corporate group plans.
deleted 5y ago
[deleted]
junar 5y ago
At least in the US, the gym has to be exclusive to employees and their families to qualify for a tax benefit. > You can exclude the value of an employee's use of an on-premises gym or other athletic facility you operate from an employee's wages if substantially all use of the facility during the calendar year is by your employees, their spouses, and their dependent children. For this purpose, an employee's dependent child is a child or stepchild who is the employee's dependent or who, if both parents are deceased, hasn't attained the age of 25. The exclusion doesn't apply to any athletic facility if access to the facility is made available to the general public through the sale of memberships, the rental of the facility, or a similar arrangement. https://www.irs.gov/publications/p15b#en_US_2021_publink1000193657 https://www.irs.gov/publications/p15b#en_US_2021_publink1000...

airstrike 5y ago

Conversely, here's really "All you need to know about gift cards": think about the interest being generated from all that cash sitting idle on some issuer's account while the recipient of your gift card decides how to spend their money. > Most retailers do not have sufficient gift card liabilities and do not have sufficiently sophisticated treasury teams to make a meaningful amount of income off an investment portfolio. This assumes that the retailer is the one holding the cash and not the issuer of the card. I'm by no means an expert in the industry but IIRC there's a whole lot more that goes into this than the author implies. > Also, they have a much better option. Unlike insurers, who must maintain reserves by regulation, most businesses issuing closed loop gift cards are not required to maintain reserves. They can simply use the cash as a source of working capital for the business, similar to other sources of working capital, except substantially free. Even in a capital-drenched economy, it is tough to beat free. Agreed, except it would be much better for it to be either me or my recipient who benefits from said "free money".

mistrial9 5y ago
yes, the article mentions coupons briefly, which are ancestors and a very large topic. Diligent literature search turned up very little. The way the money is actually handled is trade secret it seems. This is a very old aspect of money handling in retail.
brewdad 5y ago
My brother gifts us AmEx gift cards every year. I think he gets them at a discount so it does allow his gifting budget to go further but they are a pain in a-- to use. Unlike a store gift card, they are almost impossible to stack with other payment methods (at least online). Additionally, the test charges a store does to ensure the card is valid places a hold on some of the funds of the card (typically a dollar) making it virtually impossible to use all of the funds on the card. Typically, I end up adding them to my Amazon payment methods and buying an Amazon gift balance to myself and toss the remaining $1 of value in the trash. I also end up "buying" the gift cards from my wife and son since I'm the only one with the patience to deal with them, so at least we get most of the value off of them rather than letting them expire. It's now 12 days until Xmas and I finally spent us down to only $11 left from last year's cards.

throwaway413 5y ago

Idea: “unlocked” public bitcoin wallets with autogenerated key pairs that can be given to someone without them needing a pre-existing wallet. 1) transactions are instant and free, ie giving over physical ownership of a pub/private key pair (this could be done via scan of a QR code) 2) no prior onboarding necessary (avoids the repeated question “do you have this wallet/app?”) Before, if I didn’t have cash, to tip a valet I’d have to ask them “do you have Zelle or Venmo?”, then I’d get their details, then send them money. Here, I could just pull out my wallet, create a new wallet with the specific amount, show them the QR code and say “scan this and it’s yours”. Basically bitcoin gift cards without the store-specific lock-in.

agentdrtran 5y ago
transactions are very much not free when paying with bitcoin, and this has been tried in a few forms already but none have been successful. how can they spend what you give them? are you going to sit there and explain bitcoin to the waiter?
- throwaway413 5y ago
  Let me clarify. Yes, you have to pay transaction fees when transferring money on the blockchain. I am proposing that no transaction would occur. Just like when you hand cash to someone, no external transfer needs to take place. You would essentially be giving them full access to said wallet, and giving up ownership. No transaction would need to be recorded to the blockchain because no actual wallet transfer would take place. Only the immediate physical ownership of the keys which could happen offline, instantly, etc. The rest of your questions are not answered so easily, and agreed, this still doesn’t answer the issue of onboarding to crypto in general. What it does solve though is the necessary onboarding to creating a wallet and understanding how to receive bitcoin. No one needs to “understand” how to receive cash. You stick your hand out and receive it. Should be just as easy as that with bitcoin.
mattnewton 5y ago
Wouldn't your valet example be even easier with venmo? Or is it because the money has a QR code instead of the account - that could easily be done with venmo, but isn't, it's true. With crypto I worry about the transaction costs dwarfing the utility of something like this. Without a central exchange avoiding fees for the tiny movement of crypto, you'd lose too much in transaction costs when setting up a new wallet to give away. But if you have a central exchange running it anyways why not just expose this UX over an existing cnetralized payment system like venmo?

dwighttk 5y ago

> it’s very tempting for a payments geek to wax laconic about… That’s a novel use of laconic to me. Maybe he meant lyrical?

jrochkind1 5y ago
indeed, it's kind of an oxymoron!
gifnamething 5y ago
Sounds OK to me. I could imagine 'gift cards are just interfaces', which is laconic, among other adjectives.
- dwighttk 5y ago
  If so it is a novel use of “wax” for me.

tfang17 5y ago

If anyone is looking for a gift card provider to send gift cards via email, try out Tremendous! We use and love them. Nice APIs and super simple to integrate.

bedhead 5y ago

My theory on gift giving is to get the person something they probably want but normally wouldn't, for whatever reason, buy themselves. Like a nice bottle of wine, a lot of people would love it, but would also feel silly spending money on it. It's obviously not always that easy to do this but anytime you can I've found it goes over really well. And yeah, it usually involves kinda silly luxuries like wine.

agustif 5y ago

Would you people gift something like an expensive cruise travel package in a gift card?

makecheck 5y ago

Gift cards are the ultimate anti-consumer scam: - If you buy a gift card that isn’t worth enough for what you actually buy, the store “wins” because you will probably make up the difference with cash and they then sell you something you either would not have bought at all, or bought somewhere else. - If you buy a gift card that is worth more than whatever you end up buying, the store “wins” again because they have received the full value and you did not. - If you buy a gift card and by some miracle it is exactly matching the cost of what you buy, the store “wins” yet again because (a) you were still only able to purchase items from that store, and (b) the entire time you were holding the card, it was slowly losing value because only bad things could have happened: the store might have stopped offering what you wanted, the price could have changed, or heck the store could have simply gone out of business. Meanwhile, the store was already paid by you for the card (in yesterday’s dollars) so they could do almost anything with that CASH, including putting it in a saving account, and end up better off than you. Simply put, it is never, ever, ever to your advantage to have a gift card. Ever!! Cash is better in every possible way.

ketozhang 5y ago
What about credit card rewards that are high in certain types of store (e.g., 6% cash back on groceries)? I don't see how this is more than the consumer getting a product 6% less than what they would initially pay.
flh 5y ago
I mostly agree with you, but I don't think most people are buying gift cards for themselves. Why would they when there are activation fees attached to these products? Generally they're given out as kind of a lazy gift among family and friends during the holidays, or somtimes from businesses to their employees. As long as the card is for something mildly useful like Starbucks (Although according to the post this seems to be the one that is actually redeemed the least), or Amazon then I wouldn't be too upset about receiving one. At the end of the day though I'm in the same camp as you when it comes to my own spending. I don't like to give money to anyone for anything less than immediate services rendered.
- 5y ago

httpz 5y ago

Gifting is much more than just a monetary value transfer from one person to another (unless you're a soulless tax lawyer) and so many people here are forgetting that. I see gift cards to be somewhere between a thoughtful physical gift and a bank transfer. I'd rather give my nephew a $50 gift card to a bookstore than $40 in cash.

shaklee3 5y ago
this is pretty much exactly what he says in the article.

boppo1 5y ago

I once worked at a small business, single-location franchisee of a niche brand. I got a pretty good look at our balance sheet a few times and damn it sure looked like giftcard holders owned us. I think that line item was like 70% of our liabilities. equity was tiny. We also sorta ran like shit, which makes sense when you consider those incentives.

dempedempe 5y ago

> A Barnes and Noble gift card to a favorite niece tells that niece that you remember she is a reader Why not just write a note and give that alongside some cash? The only time I buy gift cards is if I can get some sort of a discount. There's no other reason for me to buy them.

susiecambria 5y ago

Over the years, I have given my parents stocking stuffers and a donation to their favorite charity. They buy what they want and so the small items to open are things they will use/make them smile. And the big gift, the donation, does a whole lot of good and we all are happy.