One of the popular promotions at Publix and other chains is a discount on gift cards. At Publix, you usually have to buy a threshold value of groceries – which is always before coupons – and excludes the gift card. Then you have to clip the coupon to get a discount. So when should you jump on these deals – when is it really a good thing to get carded?
There are three factors that you should consider in deciding when to buy into a gift card deal:
- The first one is easy. Make sure that the gift cards are for something that you will use right away. With a gift card you are basically giving a retailer your money in exchange for items to be provided at a future date. We only buy into gift card deals when it is for a store where we will shop regardless of if we have a gift card, and we will shop there within the next month. We love the Publix gas card deals because one of the gas cards in this deal is for QT where we get our gas anyway when we don’t have Kroger fuel points. Another nice thing about QT cards is that we can use them to pay for our double Sunday newspapers.
- Another aspect to consider is if there are any fees, hidden or otherwise. Over Christmas there were deals for Amex, MasterCard, and Visa prepaid cards. There was a coupon discount of $10 on a $50 card, but in fine print, there was a $4.95 activation fee. Put it together, and we paid $44.95 for a $50 card that could be spent anywhere including the second half of our grocery order when we chose to split the basket. That may not have been what they intended, but it was still within the rules of the game.
- The final factor is only buy cards that will be used in a single transaction. Here is the hidden dirty little secret of the whole gift card business. The industry thrives on what they euphemistically call “breakage”. Breakage is the portion of a gift card that is never redeemed. The portion that is lost, forgotten, or just too small of an amount for you to worry about. This last point is the most important one. Why do you think someone is willing to sell you a $50 gift card for $40? They know that enough money is never going to be redeemed to make the offer profitable.
You’ll notice that we haven’t discussed using gift cards as actual gifts. That’s because we don’t typically buy into gift card promotions unless we are going to use the cards ourselves. If you want to give a gift card, then that is great, and gift card deals are a great way to do it. We just don’t allow one of these enticements to change our gift plans.
Do you have any questions about gift card deals or have you found any great ones?