Many consumers apply money-saving techniques such as coupons, rebates and cashback programs when shopping. Another cost-effective option includes discount gift cards. Whether it’s groceries, clothing or services, discount gift cards can be used to secure stackable savings.
This study delves into the secondary gift card market as well as gift card purchasing and redemption habits.
About The Study
Gift Card Granny conducted a 20 question, web-based survey with Gift Card Granny members. Analysis was based on responses from 2,907 consumers who have used the Gift Card Granny website. Data was collected between November 13, 2017 and November 15, 2017. Similar to other industry studies, users do not yield a random probability sample of the target population.
What is the Secondary Gift Card Market?
The secondary gift card market is a platform where individuals can sell or trade gift cards. The selling and trading of a gift card is either administered through a reseller or from one person to another. Examples of resellers include pawn shops, grocery stores, check cashing service centers as well as online sites such as Cardpool, ABC Gift Cards and Raise. How Does The Secondary Gift Card Market Work? Individuals relinquish their gift cards to resellers in exchange for payment or another type of gift card. Resellers provide a payout based on the card’s fluctuating market value. The dollar amount varies based on reseller, payment transaction and type of gift card. A seller typically receives 60 to 90 percent of the card’s worth, while traded gift cards usually yield a better value. These previously owned cards are then sold to consumers at a discount, allowing consumers to purchase a gift card for less than the card’s value.
Where Do Discount Gift Cards Come From?
There are multiple avenues that fuel inventory for the secondary gift card market. An individual can sell an unwanted gift card in return for cash or another gift card. Alternatively, those who utilize credit cards to earn points often redeem rewards towards gift cards. In this instance, resellers will purchase the gift cards and then list the cards for consumers to purchase. Additionally, client services often purchase gift cards in bulk for rewards and perks. Unused gift cards are often unloaded to a reseller and populate the secondary gift card market. Gift cards are also used as payments for goods and services. Forty nine percent of study respondents use an unwanted gift card for the purpose of not letting it go to waste while 48 percent re-gift it. Nearly eighteen percent claim to sell it online for cash and ten percent prefer to trade it for another gift card.
Risks In The Secondary Market
Gift cards often act as another form of currency, leaving the secondary market a potential target for fraudulent activity. There are multiple ways fraud occurs within the marketplace. Examples include money laundering, returns from stolen merchandised as well as disputed charges from a fraudulent credit card.
Gift Card Purchasing Habits
There are a few key discount gift card purchasing habits. Consumers purchase nearly two gift cards for person use each month. Users report buying gift cards when a promotion or offer is available at one of their favorite stores. Gift card redemption habits are specific in the secondary market. Based on the survey, 70 percent of respondents report having combined a coupon with a discount gift card. This is called "stacking" where pairing the coupon to the discount gift card gets the user more savings on the purchase. Additionally, 64 percent of people report having bought a gift card solely to earn extra reward points or cash.
Gift Card Granny helps consumers find and compare discount gift card and has been saving shoppers money since 2009. Originally founded as the first gift card comparison site, Granny has grown from a single person operation to a team of nearly 40 employees. Today, Gift Card Granny is the largest discount gift card website on the Internet – with more than 400,000 gift card deals and over 18 million visitors a year. Headquartered in Pittsburgh, PA, Gift Card Granny is the latest in a long line of successful gift card websites owned by Wolfe, LLC. Granny’s savviness and ability to find the best deals on discounted gift cards has earned her notoriety from many major news outlets over the years. The Today show, ABC Nightly News, the Huffington Post, Oprah, and Forbes Magazine have all written and talked about Gift Card Granny extensively.
Read The Secondary Gift Card Market: What Are Discount Gift Cards And How Do They Operate by clicking here.