Adonis Diaries

For Xmas season: Use imagination on wasteful gift cards presents

Posted on: November 23, 2011

For Xmas season: Use imagination on wasteful gift cards presents

Every year, companies like Gap, Toys for US, Best Buy, all these health spas and gym facilities…cash in about $8 billion in services not rendered: 20% of recipient of gift cards never use them.  Consequently, companies retain the cash received in exchange of plastic gift cards that were not used by disgruntled recipients.

In 2006, the financial-service research firm TowerGroup estimated that $80 billion were spent on gift cards. The monetary amount of unused gift cards has a bigger impact on consumers than the combined total of both debit and credit-cards fraud.

Companies welcome Xmas season for making huge cash profit: First, consumers are readier to spend money to coincide with the “Xmas spirit” of giving and buying jacked up consumer’s prices on products and services because they cannot retain their zeal until the sales period immediately after the holiday season; second, for unused gift cards, and third, because returned gift cards shoot for more expensive alternative products…

If you won’t consider giving cash as 42% of grandparents do, you must start using better imagination strategy for understanding the psychology of the recipients, such as discovering the guilty-pleasure gift that people won’t buy on their own volition or delay on these tricky decisions.  You have got to know better than the recipient what he actually wants but didn’t know, like having a thorough pedicure (cutting feet nails), and be personally accompanied to these taboo parlor facilities…

With an equal amount of cash, holiday gift-giving destroys a third of the value of gifts:  Recipients lack bargaining power leverage and their choices are limited… Receivers of gift cards think they are easy and readily available to purchase and consequently are not that valuable: Gift card presents didn’t require any effort or time invested in the transaction…

If you intend on purchasing gift card, you had better understand the “wild-self” in recipients, like bungee jumping, gliding, kite surfing, joining team for climbing Mount Kilimanjaro, treasury hunting in deep oceans, boarding civilian shuttles to the moon… Something to the effect of getting rid of another name on the list for next year gift round

I mentioned pedicure as priority gift card because many elderly and obese people cannot bend to trim their feet nails, even if they intend to.  Feet nails grow in length and in hardness that specialized saws are needed and specialized experts for doing a proper job.

Note: Inspired by a chapter in Freakonomics by Levitt and Dubner

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November 2011

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