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PolWloFEcerlkieisds TGWHIOFETRALCMDAARODZFISNDGISCNOEWUNTEDIsrael. The seminary is not an EEI,
nce upon a time, people
gave gifts. For holidays, certificates evolved into “gift cards,” for that vendor are listed. Some have
birthdays, and special occa- which solved problems for the giver face values for small amounts, such as
sions, your friends and fam- and recipient and thus became very $20, and others for much larger
ily would buy you a necktie popular. You can now purchase these amounts, such as $500.
for literally hundreds of popular chain
Oor transistor radio, a neck- stores. Gift cards have become a $130 You can also see the discount rate
for that vendor. A store in greater
lace or a crock-pot. The billion industry! demand sells at a smaller discount.
problem was that no one Target, for example, might have a dis-
knew your taste in neckties or whether The Secondary Market
count rate of 5%, meaning that you
three crock-pots were already lan- What this article is about, however, is would pay $95 for a $100 card. Macy’s
guishing in your cupboard. This situa- the entire sub-industry that was creat- cards might sell for a 7% discount, or
tion resulted in many exchanged gifts. ed by gift cards – in the resale of $93 for a $100 card. The discounts
For the vendor, this meant a loss of unwanted gift cards. Yes, folks, people fluctuate based upon supply and
profit, due to the manpower needed to are selling hundreds of millions a year demand, just like other kinds of mer-
handle the exchanges. Furthermore, flipping the slipped gift cards. What a chandise. If demand for a card goes up,
the returned merchandise was often business! the discount will get smaller. In the
not in pristine condition or was poor- Here’s how it works: Let’s say some- above example, it means that more
ly re-packaged, creating a product that one gives you a $100 gift card to Home people want to go to Target than to
could no longer be sold as grade-A. Depot, but you do not want it. You go Macy’s. Naturally, Wal-Mart sells for the
On December 26th, the stores had to online and sell it to one of these card smallest discount due to the great
deal with long return lines and lost vendors at a 15% discount. You get 85 demand.
profits. bucks in your pocket and are happy.
One could always give a gift certifi- The card vendor then sells the card Answering Your Questions
cate, of course, which allowed the online for $95, for a profit of $10. Or Is there a risk? I deal mostly with
recipient to buy what he or she pre- you need to spend $1,000 at Home CardCash, and they guarantee the face
ferred. It was a good deal for the stores, Depot for a home project. You go value of their cards for 45 days after
as it meant no return on that transac- online and buy $1,000 worth of cards purchase. Although gift cards never
tion, no ruined merchandise or repack- for $950. You just saved $50. expire, your secret card number could
aging, and one more little goodie: slip- By way of analogy, imagine a casino be stolen and used by others. For
page, from the word “slip,” as in “to fall with magical slot machines, where you example, someone may hack into your
by the side.” It refers to the fact that if always win. You put in $95 and out computer or a business’ computer sys-
the gift certificate was not redeemed, comes $100 – guaranteed. Now that tem and retrieve the gift card numbers.
the store got free money! would be quite a popular casino. Well This happened to me on a Zappos
My impression is that gift certifi- folks, it is going on big-time via used card, and Zappos refunded me the
cates were never a huge market, gift cards. money when they determined that my
because many people felt they were There are numerous sellers of gift number had indeed been stolen. (I was
impersonal and did not represent the cards, but the big three are Cardpool, lucky that the thief was sloppy. He
caring that the giver wanted to convey. Raise, and CardCash (out of – you bought a million dollars worth of
Somewhere along the way, however, guessed it – Lakewood, New Jersey). shoes, using my number among many
the etiquette changed. With the help of You go to the website and search for others.) In a rare occurrence, a card
computer technology, the old-time gift vendors, where all the cards available was never good to begin with. In either
96 u www.wherewhatwhen.com u
PolWloFEcerlkieisds TGWHIOFETRALCMDAARODZFISNDGISCNOEWUNTEDIsrael. The seminary is not an EEI,
nce upon a time, people
gave gifts. For holidays, certificates evolved into “gift cards,” for that vendor are listed. Some have
birthdays, and special occa- which solved problems for the giver face values for small amounts, such as
sions, your friends and fam- and recipient and thus became very $20, and others for much larger
ily would buy you a necktie popular. You can now purchase these amounts, such as $500.
for literally hundreds of popular chain
Oor transistor radio, a neck- stores. Gift cards have become a $130 You can also see the discount rate
for that vendor. A store in greater
lace or a crock-pot. The billion industry! demand sells at a smaller discount.
problem was that no one Target, for example, might have a dis-
knew your taste in neckties or whether The Secondary Market
count rate of 5%, meaning that you
three crock-pots were already lan- What this article is about, however, is would pay $95 for a $100 card. Macy’s
guishing in your cupboard. This situa- the entire sub-industry that was creat- cards might sell for a 7% discount, or
tion resulted in many exchanged gifts. ed by gift cards – in the resale of $93 for a $100 card. The discounts
For the vendor, this meant a loss of unwanted gift cards. Yes, folks, people fluctuate based upon supply and
profit, due to the manpower needed to are selling hundreds of millions a year demand, just like other kinds of mer-
handle the exchanges. Furthermore, flipping the slipped gift cards. What a chandise. If demand for a card goes up,
the returned merchandise was often business! the discount will get smaller. In the
not in pristine condition or was poor- Here’s how it works: Let’s say some- above example, it means that more
ly re-packaged, creating a product that one gives you a $100 gift card to Home people want to go to Target than to
could no longer be sold as grade-A. Depot, but you do not want it. You go Macy’s. Naturally, Wal-Mart sells for the
On December 26th, the stores had to online and sell it to one of these card smallest discount due to the great
deal with long return lines and lost vendors at a 15% discount. You get 85 demand.
profits. bucks in your pocket and are happy.
One could always give a gift certifi- The card vendor then sells the card Answering Your Questions
cate, of course, which allowed the online for $95, for a profit of $10. Or Is there a risk? I deal mostly with
recipient to buy what he or she pre- you need to spend $1,000 at Home CardCash, and they guarantee the face
ferred. It was a good deal for the stores, Depot for a home project. You go value of their cards for 45 days after
as it meant no return on that transac- online and buy $1,000 worth of cards purchase. Although gift cards never
tion, no ruined merchandise or repack- for $950. You just saved $50. expire, your secret card number could
aging, and one more little goodie: slip- By way of analogy, imagine a casino be stolen and used by others. For
page, from the word “slip,” as in “to fall with magical slot machines, where you example, someone may hack into your
by the side.” It refers to the fact that if always win. You put in $95 and out computer or a business’ computer sys-
the gift certificate was not redeemed, comes $100 – guaranteed. Now that tem and retrieve the gift card numbers.
the store got free money! would be quite a popular casino. Well This happened to me on a Zappos
My impression is that gift certifi- folks, it is going on big-time via used card, and Zappos refunded me the
cates were never a huge market, gift cards. money when they determined that my
because many people felt they were There are numerous sellers of gift number had indeed been stolen. (I was
impersonal and did not represent the cards, but the big three are Cardpool, lucky that the thief was sloppy. He
caring that the giver wanted to convey. Raise, and CardCash (out of – you bought a million dollars worth of
Somewhere along the way, however, guessed it – Lakewood, New Jersey). shoes, using my number among many
the etiquette changed. With the help of You go to the website and search for others.) In a rare occurrence, a card
computer technology, the old-time gift vendors, where all the cards available was never good to begin with. In either
96 u www.wherewhatwhen.com u
