November 13, 2007 Spanish
Gift cards are easy to give ... but also easy to forget, a new survey finds.
A study conducted for Consumer Reports found that 27 percent of gift card recipients have not used one or more of the cards, up from 19 percent at the same time last year. And among consumers with unredeemed cards from last season, 51 percent have 2 or more.
All of that adds up to a giant holiday gift for retailers and a big loss for consumers. TowerGroup, a market research firm, estimates that nearly $8 billion was lost last year due to unredeemed value, expiration or loss of gift cards.
Gift cards are expected to be a major component of holiday giving this year, with estimates putting sales at more than $100 billion in 2008. And according to CRs survey, 62 percent of consumers are planning to buy gift cards this season.
The survey also found that when the time came for consumers to redeem their gift card, the majority of consumers also spent quite a bit of their own money, with 60 percent spending more than the value of the card.
Its easy to understand the appeal of gift cards. Theyre the perfect no-muss, no-fuss gift for the finicky family member or friend. Its a no-brainer... said Tod Marks, senior editor at Consumer Reports. But gift-givers and recipients alike need to be aware of the pitfalls and make sure that precautions are taken so that the recipient gets the gift and not the retailers.
What happened?
So why don't consumers cash in their cards? Over half (58%) said they don't have having the time; followed by not finding anything they wanted (35%).
• Nearly one-third (32%) of respondents who have unused cards from last holiday season did not use their gift card because they forgot about it.
• A good proportion of consumers (7%) will never redeem their gift cards from last season because the card is lost (3%) or expired (4%).
What to do
Gift cards seem like a perfect solution to the problem of what to give this holiday season. They are offered by banks, shopping malls, retailers, airlines, restaurants, hotels, Web sites, and even state parks.
Consumer Reports offers the following tips for gift card-givers to help ensure that the gift is enjoyed by the recipient:• Think twice about bank cards. While bank cards generally can be used at more retailers than store cards, theyre often loaded with fees and restrictions.
• Check the merchants prices. Its annoying to get a $25 gift card for a store that sells little at that price. When selecting a store-issued card, find out how much things generally cost and get a card with at least that value.
• Send along the receipt. Some issuers require the original receipt to replace a lost, stolen, or damaged card.
For gift card recipients, these are some of the tips that Consumer Reports offers:
• Register it. Some cards must be registered with the issuer, especially if the card is used for purchases online or by phone.
• Spend it quickly. Use the card as soon as possible, especially if it expires or has a monthly maintenance fee.
• Spend it to the last penny. If the card balance gets so low that theres nothing to buy, ask a merchant to do a split-tender transaction. That involves using the remaining card balance for part of the transaction and another form of payment for the rest.
• Hold on to it. Dont throw out the card when the balance is zero. Some merchants require it for returns.
