Archive for the ‘Interesting’ Category

Tech site GeekWire reports on an patent filing that, despite the obvious privacy implications, makes me sorry I didn’t think of it first.

… digging into the text, the approach includes the option for the giver to not only recommend items via the gift card but also to restrict the types of things the card can be used to buy — and to get a report back on what the recipient purchases.

Sounds like something every parent could appreciate.

We recently took a fresh look at CardAvenue which changed its business model from a strict secondary marketplace to a gift card registry and secondary marketplace listing aggregator, which lists gift cards for sale at a discount from many of the secondary marketplaces.

As one of the reasons we started this site was to help consumers get the most value out of gift cards, it is worth considering the idea of a gift card registry in the grand scheme of all things gift card.

I think it is a great idea.  Events like weddings in particular are rarely an opportunity to give a personalized gift and gift cards are very common wedding gifts, but a registry would be helpful for other events, like birthdays, graduations, and baby showers; having a registry would help insure that recipients got gift cards they could actually use.  Getting gift cards you can (and intend to) use makes them more like cash and less like money that will eventually be lost.

CardAvenue bills itself as the first and only gift card registry, but strictly speaking this isn’t quite the case.  Gift card secondary marketplace Card Hub offers a similar service and alternately call it a registry and a wish list.  Some other gift card sellers also offer a registry, but only for their own cards, making them less useful.

What is to stop other sites from copying this great idea?  Technically, it isn’t a difficult feature, but as an aggregator of secondary marketplace listings rather than a direct secondary marketplace, CardAvenue has an advantage over a registry offered as an additional feature by a secondary marketplace; namely, they can offer a much wider selection of listings than the secondary marketplaces can directly.  There aren’t too many listing aggregators at the moment (CardNap and GiftCardGranny being the other two we are aware of).

Their service would be more helpful if you could purchase cards directly through CardAvenue (without having to go to PlasticJungle or another site), which would make it easier to have the gift cards sent to (correct) recipients address, much like when you purchase a gift from a registry at Macy’s, the shipping address is already filled in.  This would require a high level of cooperation from the secondary marketplaces, so I don’t expect it anytime soon.

That retailers are realizing they have nothing to lose and everything to gain by making gift cards easier for consumers to use is what I’m taking from this piece on Cardpool’s new service (now in limited release to existing Cardpool customers) that allows you to buy gift cards, and have them immediately delivered to your iOS or Android device.

Because closed-loop gift cards are part of, well, closed gift card networks, I would guess this could only be done in collaboration with the gift card issuing company, such that Cardpool is able to issue new gift cards.

This would have to be my favorite way to use your a gift card, buy it and then immediately use it up at the checkout counter of the store you are in.

Secondary Marketplace Cardpool is now offering gift cards that can be used on their site, to purchase gift cards.

That is, two levels in indirection to a recipient actually getting a gift.

From a economical standpoint, this makes sense.

If you wanted to give your gift recipient as much choice in what gift they actually got, you could buy them an open-loop gift card, like American Express or Visa, but those come saddled with fees (yes, even after the new federal gift card laws) and are hard to spend the last few bucks.  Worse.

Or, you could give them a Cardpool gift card where they could buy a gift card from a retailer of their choice, at a discount, and likely be able to spend it all.  Better.

But as a gift, it is a horrible idea.  If a gift card tells a recipient that you weren’t willing to take the time to actually pick a gift for them, a gift card gift card (should I trademark that term?) says you weren’t even willing to take the time to pick a retailer they might like.

It’s a toss up.

I usually stick to actual gifts, unless it is a teenager that is in to music, an I get them an iTunes gift card.

Burried in this article (Bloomberg Business Week, Google’s Search for a Digital Wallet) about a payment service Google is experimenting with in Portland is an interesting tidbit that might bode well for gift card customers.

The idea behind this is that cell phones could contain a near-field-communication (NFC) chip (and some Android phones already do) that could talk to merchants cash registers and would act like credit card.  However, these chips could also store other information, such as loyalty card, coupons, and yes, gift cards.

What would make this really interesting however is if gift cards were automatically used (or at least presented) when you went to pay at a merchant.  This system, enabled in such a way, would solve three problems gift card holders currently face

  1. Losing the card
  2. Remembering to carry the card when visiting the merchant
  3. Remembering to use the card when actually carrying it

Gift cards are frustrating in all three of these ways and I have many times been carrying a card and forgotten to use it when at the issuing merchant.

Whether this is a big win for consumers depends on whether it is implemented correctly, and it doesn’t seem out of the question that gift card issuers could resist this system functioning in this way.

Here is one indications that gift cards are winning the battle against consumer advocates that say they can be a bad deal.

That’s my niece’s Christmas wish list.  Gift card issuers seem to be doing a pretty good job of creating demand for their products.

I’m just glad she didn’t ask for any open loop cards. :)

Portland’s Giftango, which had previously scored a $1.4 million Series A financing round in 2009, got a fresh $5 million recently from a group of investors, let by Minnesota’s Taylor Corp, a company involved in gift card printing and fulfillment services.

Giftango helps retailers manage digital (including mobile) gift card and loyalty card programs.

I’ve sat back silently and watched all the hubub about Facebook gift cards over the last couple of weeks, waiting until I had enough information to form a good opinion.

If you haven’t heard, the big news is that Target will be selling Facebook gift cards.  I think the reason that this is so widely reported on has more to do with the fact that Facebook is a media darling and anything related to Facebook tends to get reported on.

When you buy someone a gift card, hopefully you are buying them something they can use.  If you happen to give someone a gift card that is really useful to them, such as giving a Home Depot or Lowe’s gift card to someone in the middle of a home improvement project, it can be as good as giving them a personalized gift; you obviously put though into the choice of gift card just as you might have put thought into the choice of a normal gift.

But above all, if the gift card isn’t useful, you might as well be giving rocks.  For instance, if someone gave me (a man) a lululemon gift card, that would be a pretty useless gift.

That is one reason I personally like gift cards so much; there is a 100% chance I would use it, and use it immediately.

So what about Facebook gift cards.  Facebook gift cards are for Facebook virtual currency and can only be used in games and applications hosted on Facebook, although there is a possibility that they might be used on non-Facebook games as companies like Zynga (the largest Facebook game developer) become more integrated with Facebook credits.  Facebook has 500 million users, so Facebook gift cards are a good choice, right?

Not so fast.  According to this report, one in five Americans has played a game on Facebook.  Notice the important distinction between “plays games’ and “has played a game”.  This means that the percentage of people that are active Facebook gamers could be substantially less.  Let’s say that 1/2 of those that have played a game are active Facebook gamers.  That means that if you randomly gave a Facebook gift card to someone, you have a 10% chance of them finding it useful.  Clearly, this is not the general purpose gift card to give just anyone.

But, if you happen to be on Facebook, figuring out which of your friends is an active gamer is pretty easy as Facebook games so often produce those annoying update messages.

The point is, when giving a gift card, think about your choice of gift card as you would your choice of any other gift.  Think about getting the person something they will use and appreciate.  If they are an active Facebook gamer, by all means, get them a Facebook credits gift card.  If they love music, own an iPod, and frequently use iTunes, get them an iTunes gift card.

Thoughtful gifts are always more appreciated than thoughtless ones.

AT&T and Verizon, Deutsche Telekon and T-mobile are working with Discover to create an alternative payment network to Visa and MasterCard that uses smart-phones instead of credit and debit cards for payment.  Could this also be the future of gift cards?

A payment system like this has been talked about in the US since the early days of the Internet and places like Japan and Korea have healthy mobile-phone payment services, but nothing has ever gained traction here.

It is not hard to imagine that such a system could easily handle gift card transactions as well as credit and debit transactions.  The chief benefits would be:

Benefits to merchants: Lower cost of issuing cards as everything is electronic; no actual printed card to produce

Benefits to consumers: You will always have your card with you, as long as you have your phone, which is probably most of the time for most people.

Benefits to everyone: less of a chance of the type of fraud that occurs when gift cards are on display and easily accessible.

However, until such a system is ubiquitous, merchants would have to support both the newer electronic system and traditional gift cards, probably increasing costs of gift card programs in the short term.

I recently came across the Gift Card Trader iPhone app, on sale for $4.99 in the iTunes app store.

They are more like a Craigslist for gift cards than a true secondary marketplace, like Plastic Jungle or Gift Card Rescue.  The GiftCard Trader app allows anyone to list their gift card for sale, along with an address the transaction can be done in person.  Buyers can search for a gift card that is located for sale near them.  The idea is that, you are about to go shopping at Home Depot and you check to see if you can pick up a heavily discounted Home Depot gift card on the way there.

There are a number of problems with this business model:

  1. As I’ve mentioned a number of times, Craigslist is simply not a safe place to buy and sell gift cards; there is too high a likelihood of fraud and/or robbery if the value of the card is high enough.  In this sense, GiftCard Trader is no better.
  2. I seriously doubt that people will want to pay a fee for an app like this when there are so many good services already, some of which are bound to come out with iPhone/Android/Blackberry apps in the near future, that will be free and tied to a much safer way to transact.
  3. As with most new gift card secondary marketplaces, there were ZERO available gift cards in my area, and I am surrounded by about 5 million people.
  4. I just wrote about a new type of scam involving the scalping of gift cards in front of stores.  Because there is no way to verify the amount on a gift card at the moment you are purchasing it, you could easily pay $100 for a $0 value gift card.  This model just isn’t safe.

I like the novelty of the idea, and the app appears to be simple and well-written, but the premise behind it has some serious problems.

About a month ago, I did a post on Plastic Jungle’s announcement that they were working with First Data, who runs a number of retailers gift card back end networks, to be able to start processing secondary gift card sales electronically rather than by mail, thus making the process more efficient and easier for customers.  I also theorized that retailers were willing to get involved in this because they realized that the days of free money via gift card breakage (what customers don’t spend) were over because states are now aggressively going after the money via escheat (unclaimed property) laws.  Retailers probably realize they have much more to gain by helping consumers spend the gift cards, because people often spend more than the face value of the gift card when they do visit the store, aka, the bump in sales.

Now, another gift card company, Wolfe, LLC, owners of the and sites, is also launching an electronic gift card secondary market they are calling  They are also working with First Data and their FAQ pretty much solidifies my theories around why retailers are willing to let secondary gift card markeplaces handle their cards electronically, as they are pitching both lower escheatment and increased sales as retailer benefits:

Increase Sales / Reduce Escheatment: We enable motivated buyers to purchase your gift card and quickly spend those funds – putting cash in your register and off the balance sheet.

Since Wolfe, LLC’s business is familiar with  the production of physical gift cards, while the site doesn’t say so explicitly, I suspect they might also be interested in issuing physical gift cards as well as electronic ones; not everyone will be comfortable with an electronic only gift card.

However, as we move closer to the reality of electronic processing in the secondary gift card market, I can’t help but wonder if things might take a different turn. Read more…

Take a look at the deal shown in the picture.

That’s right, for 2x$6.49, you get the razors and a $5 gift card.  This makes me wonder if the retailer knows something that most consumers don’t.  I don’t think we have to look to far or think too hard to figure this one out.

The type of card you would get is likely a rewards type gift card and is not subject to the same new gift card rules and, more importantly for the retailers sake, escheat laws (state’s taking possession of unclaimed property) and expiration dates that normal gift cards are, thus if you don’t spend it, Target gets to keep the money.

I am guessing the people are Target are pretty smart people and to have come up with a deal like this, they know that in the end, they will win.  This means, it is probably pretty safe to say that they expect a large portion of those $5 gift cards to not get spent.  It may be that $5 on a gift card is just little enough that people (a) won’t bother to spend it quickly, and (b) won’t pay attention to the fact that it likely has a short expiration date.

Don’t be swayed by what looks like free money.  In the end, it probably isn’t.

Update:  Looks like this is a regular thing at Target, as I found another one just like it.

I’m not sure exactly how the main-stream TV news gets their stories, but in the last 10 days or so I have seen the websites of ten or more TV news stations reporting essentially the same story on gift card resale sites, a phenomenon I have not seen in the couple of years I have been covering gift cards.  I’m sure for every one of these stories I’ve seen, two more I haven’t.

The news stories are all very similar and report the same few gift card resale sites, leading me to believe they are all getting the same story from an Associated-Press type outfit, or maybe they just copy each other.

Our own site has seen a bump in visits over the last coupe of weeks; perhaps those stories are helping people to find us as well.

Cupertino-based Mobeam has created a device called Numi that is specifically made for holding retailer loyalty card (Ralphs club, etc.) information which it cam beam using an LED into a checkout scanner, thus allowing you to carry one key faub size device on your keychain rather than a bunch of credit-card sized loyalty cards.

Where this gets interesting is when the Numi gets the ability to carry gift card data as well, which would allow people always have their gift cards with them when an opportunity to spend them comes up.

Not a bad idea, but the company has no plans to support this until it has partnerships with retailers set up.

Personally, I’d rather have my mobile phone carry my e-gift card data and scan it at a checkout with an on-screen barcode, much like I am able to do when I travel with some airlines, rather than carrying a boarding pass.  That would save me from having yet another thing on my keychain.

With 40+ active sites that buy and sell used gift cards now, the market for buying and selling gift cards is a lot like eCommerce was in the early days of the internet boom.  Lots of places to shop with widely varying prices.  Since then, shopping comparison sites like PriceGrabber and Nextag have flourished and made online price comparison shopping much easier than going to each site and doing the price comparisons yourself.

What the gift card resale marketplace needs now is a gift card shopping comparison meta-site, a great opportunity for some internet entrepreneurs.

Update:  There is actually one such site,, but it isn’t particularly effective and only appears to poll a few sites, which includes Ebay, not a particularly safe place to buy a used gift card.

As if gift card issuers didn’t already let us know the gift cards we pay cash for are not actually meant to be treated like cash, Sears announced that gift cards can not be used towards the qualifying purchase price of their $50 men’s clothing rebate promotion.

This sounds an aweful lot like the Apple fiasco where they would not allow iTunes gift cards to be used towards the purchase of Apple hardware in Canada.

We recently reported on Plastic Jungle’s integration with First Data’s electronic gift card network, allowing them to handle some gift cards electronically, saving customers the trouble of completing transactions by mail.

Here is what First Data has to say about working with Plastic Jungle:

But now there are sites that can provide a trusted environment for consumers to sell cards they don’t want and buy cards they do want at a discount. Merchants benefit as well, because when consumers purchase gift cards they want and will use, there is an increase in store foot traffic and a reduction in outstanding liability and escheatment concerns.

For those not familiar, escheatment is the process of turning unclaimed or abandoned property to a state authority.

What they are telling us here is subtle, but important and could signal a significant change in the retailing industry’s perspective on gift cards.

For many years, gift cards have been win/win for retailers, meaning they win twice.  When a customer comes in to spend a gift card, they often spend more than the face value of gift cards.  Retailers also had the added benefit of breakage, where as much as 10% of face value of gift cards went unspent and retailers got to keep this money as profit.

However, in recent years more and more states got hip to breakage and started demanding the retailers turn over breakage to their unclaimed property coffers, presumably under the guise of making this property easier to reunite with its lost owners.  But it was no great secret that the majority of this unclaimed gift card money would go straight to states’ general fund as it is notoriously hard to reunite with its rightful owner, meaning the customer that either forgot about, lost, or had a really hard time spending the full amount of their gift card.  This has turned retailers win/win for gift cards into a win/lose.

Well, that little statement buried in First Data’s press release signals an attempt by retailers to turn their win/lose back into a solid win.  You see, by acknowledging that they no longer benefit from breakage, and trying to make it easier for customers to redeem the full value of their gift cards, or allowing someone else to benefit from an unwanted gift card, they benefit more than the unused gift card $$$ going to the state, as they get to claim that gift card money as sales and stand to benefit from the additional sales that gift card redemption typically brings.

This is a good thing for consumers.

Plastic Jungle has just announced its integration with the electronic systems of First Data, one of the large gift card networks (the system behind in-store gift card issuing and processing).  This means that they will be able to handle some gift transactions electronically for gift cards that use First Data’s network and for stores that agree to allow Plastic Jungle to do this.  It also means they can issue new gift cards electronically for participating retailers.

The bottom line is that for some transactions the part where you mail in your card or receive your new card by mail will be removed, making it faster and less cumbersome to sell them your old gift card or receive your new one (electronically).

Other features we’d like to see them add?  How about receiving funds for gift cards they buy via PayPal?  Now that they can process some transactions electronically, can they combine lower value gift cards such that they can purchase gift cards with a face value lower than $25?

According to this article in the Los Angeles Times, about 8-10% of small businesses today offer gift cards, up from 2% two years ago.  The costs of setting up to offer gift cards can be as low as $800 plus a small monthly fee.  Many small business owners report selling many more gift cards than the paper gift certificates they previously offered.

Home Depot has a new feature where you can upload a personalized video tied to a particular gift card.

My first thought was, how stupid, and that is how many things related to gift card strike me.

But, on deeper consideration, not a bad idea.  You’ve got a gift card which specifically tells the recipient to go to a particular website and enter their gift card number to retrieve their video.  I like it.

If it wasn’t for scammy websites claiming to be able to tell you your gift card balance but really trolling for gift card numbers to steal, I would say this is a good opportunity for someone to create a website like this that works for ALL gift cards, which also allows people to print out personalized gift card holding greeting cards that also inform the recipient of the video website.