Target stores have a solution for those who were disappointed in the gift cards they got in their Christmas stockings. The retail giant is willing to trade their gift cards for other stores’ cards.
Here’s how the Target trade-in program works: customers bring their gift cards to the mobile phone counter in the electronics department. There, a store employee will give them an offer for a lesser amount based on the resale value of that card. For example, a $100 Wal-Mart gift card can be exchanged for an $85 Target gift card, the company says. If the customer accepts the offer, he or she will be handed a Target gift card on the spot. Hundreds of cards from various brands are eligible for the program.
The Target trade-in program is one of many ways people can unload unwanted gift cards. The story highlights a number of them, including Blackhawk Network’s CardPool site, which is a partner for the Target program and a similar one at video game retailer GameStop.
In addition, companies like Pay Garden and Open Bucks allow gift card holders to redeem their cards at unaffiliated merchants and in some cases even use the funds to donate to charity.
Retailers understandably are cautious about what these kinds of consumer tools mean for their brands. No one wants to see their cards selling for a steep discount, but every retailer wants their cards in the hands of motivated customers. There is value in the secondary market for gift cards, but retailers will need to learn how to mine it.
Overview by Ben Jackson, Director, Prepaid Advisory Service at Mercator Advisory Group
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