Get carded

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Get carded

Cynthia Smith joined millions of shoppers nationwide this holiday season as she waited in line Dec. 20 at the Galleria at Sunset mall to purchase a gift card for her 22-year-old son.

The National Retail Federation, a retail trade association, estimates that gift card sales will total $24.81 billion this holiday season, up more than 30 percent from last year.

Smith, a Henderson resident, said she does not go this route often when doing holiday shopping, but in her son's case, it made good sense.

"He needs things that are hard to buy for him, like pants," she said after purchasing the card. "And I don't like to give him cash that he might spend going out to eat."

Vicki Rousseau, director of marketing at the Galleria at Sunset, said more than 50,000 Galleria gift cards were sold in 2005. Given that it has been a "very strong season," she said she expects 2006's figure to leapfrog that, although she declined to release specific sales and earnings data.

The mallwide gift cards are good at all retailers and booth vendors, Rousseau said. The cards were introduced in 2004 and have been a hit, she said.

The cards, which can be loaded with $10 up to $500, keeps more money in retailers' pockets because change is not issued for purchases that come in under the card's value, unlike gift certificates of yesteryear, Rousseau said. Retailers also benefit from gift card recipients paying extra money over the card's amount to buy higher dollar items.

Overall, she said there are no drawbacks to "giving the gift of choice" because gift cards allow people to get what they want and, in some cases, that which they otherwise might not have been able to afford.

"I think you see the popularity of them because of all the retailers coming out with them," she said, referring especially to smaller retailers that have recently hopped on the bandwagon. "It's easy for shoppers to carry, it fits in your wallet, it's not cumbersome."

Retailers themselves also offer holiday cards that are good at all of their stores. The mall does not track these sales, Rousseau said.

"But our gift cards can only be used at this center," she said.

Rousseau could not say whether more physical merchandise moved off store shelves before or after the holiday season as a result of gift cards. But, she added, the cards have brought about a new concept in the retail industry.

"I think what you're starting to see ... is the second Christmas," she said.

For many of the retailers that offer store-specific cards, unused cards have resulted in a profit windfall, with several reporting it as high as millions of dollars in recent years. Rousseau said, for the most part, most of the gift card value that the Galleria issues actually is spent there, rather than lost or forgotten.

"There's probably a small percentage that people either don't use or forget about," she said, adding that there is one plus to having a mallwide card: "There are so many avenues where people have to spend."

While Smith acknowledged the convenience of buying the gift card, she said she would not buy gift cards exclusively to make it easier.

"It takes the fun out of it," she said.

According to a statement from the National Retail Federation, reports about a gift card scam in which consumers potentially could lose money from gift cards if criminals steal the numbers from the back of the card "are accurate but somewhat misleading."

"The retail industry has implemented sophisticated safeguards to prevent thieves from obtaining, and using, consumers' gift cards," said Joseph LaRocca, NRF vice president of loss prevention, in a statement. "Most gift cards are outfitted with scratch-off security codes and protective packaging, in addition to a special verification number distinguishing one gift card from another. Also, retailers have created complex back-end systems to prevent criminals from obtaining proprietary gift card information."

The NRF encouraged shoppers to keep the original receipt from the purchase of gift cards in case they need to return a card to a store because it has been used.

Another recommendation for keeping your gift card safe this season is to make sure the personal identification information on the card does not appear to have been scratched off.

Galleria at Sunset reports gift cards are growing in popularity