Gift Card or Cash?

Gift cards are great. They’re easy to buy, easy to give, and easy to use–if you use them. Retailers sell a lot of giftcards. Customers redeeming is another story. January saw a slump in terms of sales, part of which is probably attributable to the lack of shoppers coming in to redeem the cards they were given as presents over the holiday.

Many retailers who sell gift cards do not count the cards they sell as revenue until the customer goes shopping and redeems the value of the card at their store. If you’ve ever received a gift card, chances are you didn’t use it, either because the gift card was not of great value to your or because the card was for a store not usually on your list of stores in which you normally shop. If you’re like me, the only way I step foot into a store is if I have to, and the only thing that will make me redeem a gift card is if it’s over $50.00 AND for a store that I would normally shop at. But I’m a tough customer.

But what about general, non-store-specific gift cards, you ask? Well, apparently these days more practical purchases are being made with those gift cards, which were once though of as free, mad money to shop for things you’d normally not buy with your own money. Gift cards these days are going towards food and general necessities rather than lavish goods or services. The recession, obviously, is partially to blame, as well as the general bad economic situation we have been in over the past year, and in which we now find ourselves languishing in.

Consumers, however, continue to buy gift cards, primarily because they’re an easy way to give without succumbing to the bad (wrong gifts, bad gifts, or cheap gifts) or having to invest too much money or time.

And that brings us to the all mighty greenback, the C A S H. Cash, my friends.

While cash may not be the most thoughtful gift at first glance, it just may be the best thing you could do–not only for yourself or the recipient of the cash, but for the overall economy in general. Cash gets spent. Period. The likelihood of someone putting that cash in a drawer and forgetting about it is pretty much nil. Zippo. Zip. While cash may not say “I love you so much I spent 5 hours and $1,000 on you today,” it does make more sense than just about any other gift you could get with a gift card–because it allows the recipient of that cash to buy whatever they want.

Next time you think about that gift card you’re thinking about getting, ask yourself a few questions:

1. Would I want the gift card i’m thinking about getting X?
2. If they get it, what are the chances they’ll use it?
3. Is cash better?

I know, a lot to think about for a simple gift–but maybe worth that extra time.