The Gift Card Scam

Introduction

Gift cards have become a popular go-to option for gift-giving, offering recipients the flexibility to choose their own items. However, a closer look reveals a darker side to these seemingly innocuous presents. With over 800 billion dollars in gift cards circulating and a staggering 15 billion left unused by Americans, it raises the question of whether gift cards are more of a scam than a convenience. According to Bankrate, half of gift card recipients forget to fully utilize the card's value, playing right into the hands of brands who profit from this forgetfulness. Brands even calculate their profit margins from these unused cards, known as breakage, giving them insight into the pure profit generated from each gift card sale.

Keywords

gift cards, scam, unused, profit, breakage, brands, forgotten, Americans, convenience, value

FAQ

1. Why are gift cards considered a scam? Gift cards can be seen as a scam due to the high amount of unused funds, resulting in pure profit for brands.

2. How much money is left unused on gift cards? Americans have approximately 15 billion dollars in unused gift cards, highlighting the significant issue of unredeemed values.

3. What is breakage in relation to gift cards? Breakage is a term used to denote the pure profit that brands make from gift cards that are not fully utilized by recipients.