It is possible to save hundreds of dollars by buying gift cards online at incredibly low prices. Purchasing a pre-owned card is anticipated to be one of the most popular presents to date, generating about twenty billion dollars in overall retail sales during the holidays each year.
However, approximately 10% of the dollars on all those sold cards actually goes unspent. As a result, many sellers have suddenly sprung up online creating a little known secondary market for these popular items. Many analysts estimate this to be an additional 2 billion dollars more in additional sales.
For all the buyers, these private and professional sellers present an amazing opportunity to buy one at savings of anywhere from 10 to even 50 percent off the original face value. All of these cards can be given to friends and family or redeemed for store merchandise. For all the traders, this can be a simple way to exchange an undesirable gift card for a more desirable one from a store that they actually prefer without the original giver ever knowing anything about it. For sellers, it is a rarely quick and easy way to get cash for their unused card.
As a note of caution, gift card exchangers need to be extra cautious when trading cards. While the majority of online sellers are legitimate, the secondary market is still a developing business. Even though there are a range of policies and protections, a transaction is only as safe as the people who mutually participate in it. Furthermore, there is still the very real concern with regards to stolen merchandise and fraud.
Currently, there are many different business models when it comes to buying second hand cards online. A more careful look into this matter reveals that there are an increasing number of reputable online market places such as eBay.
One can also purchase these cards online, but all of this generally comes at a price. Although it varies from website to website, these card specific sites usually require users to pay a registration fee; usually about fifty cents to a few dollars, or a transaction fee of 3-8% of the gift card’s total value. Many of the sites charge a combination of both, which can really eat into the overall value of your card.
Another fact to be wary of is that all gift cards are not traded equally. Paying close attention to the market demand will aid you in your search for that perfect pre-owned card.
First of all, you need to be careful and consider many things such as when to buy and sell. A lot of gift card exchange sites are disproportionate in their supply and demand and have significantly more sellers than buyers on any given day. However, during the first few weeks in the beginning of each year, particularly in the month of January after the holidays, that imbalance is amplified when the market is flooded with unwanted holiday gift cards. Other peak time periods include the weeks after similar popular gift giving holidays such as Valentine’s Day and Mother’s & Father’s Day.
For the shrewd buyer, this means a much larger selection to pick and choose from and prices that could be 15-20% percent lower than they are at other times during the rest of the year. For potential sellers, it may be a good incentive to wait, but not too long. Some gift cards which have expiration dates or charge fees when they go un-redeemed, are forbidden from the majority of online websites to prevent issues.
Secondly, you need to contemplate what to buy and sell. While it is not easy to tell from an occasional visit to these websites, understand that not every used card is good bargain. Most cards sell for ten to fifteen percent off their full face value. Note that a thirty to forty percent reduction is considered to be an excellent deal. However, the popularity of the retailer and condition of the card are critical in determining whether a used card is actually worth the price.
If you look at it from a buyer’s point of view, the largest bargains can be found at national retailers that have many unique gifts. Cards from those nationwide store chains take longer to sell, and are often offered at discounts of 20 percent or higher. Smaller regional stores often sell at fifteen to twenty percent off because there are fewer bidders and a smaller demand. Larger retailer cards trade at a bigger discount after the holidays since so many impulse buys are made that the secondary market is flooded with second hand gift cards.
Now, if you view this from a seller’s point of view, gift cards that command the most money are for big-box retail stores and discount chains. The demand is also quite strong for pre-owned gift cards from office supply retailers. They all usually bring in a return of at least ninety cents on the dollar.
However, for the majority of buyers, it is a good rule of thumb to consider the discount as well as the total actual value of the gift card. While twenty percent off a twenty five dollar gift card is good, twenty percent off a hundred dollar gift card may be much better if you pay attention to the transaction fees and other potential risks. From a seller’s perspective, that reasoning also makes trading a gift card an attractive deal as opposed to just trying to sell it.
One final thing to be aware of is the possibility of ending up with something much different from what you originally thought it would be. A used gift card seller should expect prompt payment and buyers should use a credit card or online payment service and expect to receive a card within a reasonable amount of time.
Nowadays, pretty much all online auction or seller websites include some form of fraud protection, although the complexity and extent of coverage varies. In particular, on eBay, sellers need to register with a credit card and are limited to selling one card each week with up to five hundred in stored value. This ensures that the buying experience, for someone looking to purchase used gift cards, is a safe and enjoyable one. Buying gift cards used online is simple and easy and can be done from anywhere in the world.
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