Wednesday, December 11, 2013

Gift Cards

I read an item recently that suggested that giving gift cards from retail outlets like Walmart, Macy's, etc was uncool and showed a lack of caring about the receiver.  That is hogwash.  I think they are a brilliant innovation, allowing the receiver perfect freedom to buy exactly what he/she needs or wants.  For giving something to someone living far away it solves the problem of buying, wrapping, and mailing.  If done electronically one can increase the value of the card by the amount one saves by not having to do all that.  Say your brother 1000 miles away likes music; but you don't really know his current favorites.  Why guess?  An iTunes gift card solves the problem.  And returns are now not an issue.  I am sure there are hundreds of economic grad students researching this question now!  I bet the use of gift cards actually increases overall retail sales.  How natural would it be for a receiver of an Apple gift card to go to the store and spend not only the card's value but some more money on something seen in the store?

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