Pittsburgh Post-Gazette

Nothing says 'You're special'like ... a gift card? They're easy to give and people like them. But what do they say about the giver?
Friday, November 17, 2006
By Teresa F. Lindeman, Pittsburgh Post-Gazette

We are a people torn by a conflict that has nothing to do with what touch screen we pushed in a newfangled voting booth.

More than half of consumers -- 52.8 percent -- have a gift card on their wish list this year, the National Retail Federation notes. But, somehow, the uneasiness about giving such cards persists despite their popularity among recipients.

"I give them as a last resort," admitted Kris Shideler, a McCandless mother who has been known to buy a nephew an Old Navy card only because she couldn't figure what else he would want.

"People want to get one more than they want to give one," Carl Steidtmann, chief economist for Deloitte Research, said in a recent summation of the dilemma.

Not to blow this thing out of proportion, Americans are good at working through their issues. Last year, consumers bought $18.48 billion worth of gift cards during the holidays, up 6.6 percent from the previous year, according to the National Retail Federation. In the Pittsburgh area alone, 49 percent of adults have bought a gift card in the past year, according to Scarborough Research.

Looking ahead, nearly eight out of 10 holiday shoppers plan to buy at least one gift card this holiday season, according to Columbus, Ohio, firm RetailForward. If people stick to their plans, the cards could represent close to one-fifth of holiday spending.

Before anyone starts having nightmares of new-millennium Christmas trees surrounded by pitiful, flat piles of envelopes, Bob Skiba would like to point out that even with the industry's growth, only 2 percent to 4 percent of total purchases are being made with gift cards.

It's understandable that Mr. Skiba would feel the need to defend gift cards. He is, after all, executive vice president of Comdata Stored Value Systems, a gift card manufacturer in Brentwood, Tenn.

Mr. Skiba is happy to see the growth in gift-card giving but is well aware of that old knock that the cards are not personal enough. He's a reasonable guy -- he can see the point. But he thinks retailers have beaten that rap by turning those plastic rectangles into something more creative.

Take the Golf Galaxy stores' gift card tin shaped like a golf ball. Or the American Greetings' system that allows online shoppers sending a paper card to tuck in a gift card imprinted with a picture of the family dog or the grandkids. Mr. Skiba is confident consumers have no reason anymore to be embarrassed.

Yet feelings of unworthiness linger.

"Gift cards can be kind of tacky," wrote retail consultant Pam Danziger in a pre-holiday shopping season press release. They look better when combined with a "real'' gift like tucking a Barnes & Noble card in with a Godiva chocolate four-pack, said the president of Unity Marketing in Stevens, Lancaster County.

A gift card doesn't look any more impressive loaded with $2,500 than it does with $5. Enhancements are necessary.

But do people bother? Only 6 percent of almost 650 gift card recipients polled by Comdata said their cards came in a special package provided by the giver, with 8 percent in a special package from the retailer. The most popular way to deliver the cards was to tuck them inside a greeting card.

Still, the card-mudgeon population is shrinking. About 41 percent of Comdata survey respondents described themselves as either "very" or "somewhat" unlikely to purchase a gift card this year, down from 69 percent last year.

Consumer Reports senior editor Tod Marks writes stories about how people should check twice before buying gift cards, what with all the issues about dormancy fees and expiration dates and lost cards.

Are gift cards bad? He wouldn't go that far but then he managed to come up with another thing to think about: How much money should go on that plastic? If $25 or $50 won't buy much at a particular retailer, the giver may just be setting the receiver up to spend more money. What kind of present is that?

All this deep thinking runs the risk of ruining one of the best things about gift cards: They should not require a lot of thought.

The thoughtful Mr. Marks insisted he is not anti-gift card, just a pro asking the right questions. Asked about his own practices, he started to say he'd never given a gift card as a present because he didn't consider them personal enough. But wait. He stopped to reconsider.

"I did last year give my wife a Starbucks gift card." In his defense, he said he's confident his wife drinks coffee and used the card.

Friends of M.J. Kelly can count on receiving gift cards for presents even though she and her husband launched their gift-card trading business, swapagift.com, by getting rid of cards they received as wedding presents.

None of her friends complained when she and her husband put their cards up to swap three years ago. Now, the site has 23,000 users.

Some might see the growth in the secondary gift-card business as a sign that cards have not lived up to the promise of no more returns or disappointed recipients. Ms. Kelly isn't buying it.

The majority of cards are used, she said, but there's always going to be a portion of gifts that go awry. "It's just our society. We're a society of 'we want what we want.' " So just like when your sister returns that awful sweater from grandma, the thought still counts.

Meanwhile, in McCandless, Mrs. Shideler has a rather complicated relationship with gift cards. When reached by phone, she admitted to having as many as 10 on hand, partly because two of her children recently had birthdays and were given cards.

She's also a big supporter of the school fund-raiser in which her children's North Allegheny schools earn money when she buys gift cards. Relieved not to be asked to sell candles or wrapping paper, she willingly buys cards for Giant Eagle and Festival Foods, Payless Shoes and Panera, all places she expects the family will spend money anyway.

They're called gift cards but nobody is exactly giving or receiving. That may not count.

Unlike half the consumers in the retail federation survey, Mrs. Shideler doesn't really want anyone to give her one as a present. "If you just give me $25, I could just spend it anywhere I want."