Why pay the full amount for gift cards when you can purchase them for less than face value? Every day, retailers offer card promotions, companies sell reduced-cost gift cards to customers, and people unload unwanted ones for less than they're actually worth. You can grab these deals and save big.
Click through the slides for seven ways to do it, and don't forget to check out the results of our 2010 Gift Card Study.
Gift card sites such as PlasticJungle.com and Swapagift.com let consumers buy other people's unused gift cards. With Plastic Jungle, customers can search for cards by store brand, amount or discount percentage desired, says Kristin Donelson, vice president of marketing for Plastic Jungle. Typical discounts are in the 10% to 15% range.
Card-swapping websites are likely to offer a guarantee, so buyers will know the cards are legitimate, says Donelson. With Plastic Jungle, if a buyer purchases a card and for some reason it doesn't work, he may be able to replace it with one that does, or his account could be credited for the amount paid.
The balances of gift cards on Plastic Jungle are sometimes in odd amounts. For example, the value of one card recently offered was $29.16, instead of a flat $30.
This could be awkward if the card is meant for a gift. But Donelson says an uneven amount is usually not a problem, since many shoppers buy discounted cards and then use them to purchase actual gifts. "They use the cards to stretch their holiday budgets a little bit further," she says.
According to the National Retail Federation, restaurant cards are one of the most popular gift card choices -- coming in second only to department stores. Consumers can save big on these cards by visiting websites such as Restaurant.com that offer them for prices lower than face value.
Buyers can browse by location, cuisine and average entree price. The choices vary widely, from local mom-and-pops to major chains. There are also multiple discount levels, with purchase prices that represent a 50% savings or more.
While it's possible to score some good deals with Restaurant.com, be sure to read the fine print, says Scott Testa, a retail consultant and assistant professor of business administration at Cabrini College near Philadelphia.
A minimum purchase may be required, gratuities are likely to be added in and the gift cards may be for food only (no drinks).
However, consumers will have to do due diligence to make sure they get a true deal, says Testa. To avoid scams or misunderstandings, Testa recommends that buyers ask potential sellers what the expiration dates are on the cards offered, and if there are any other penalties or restrictions.
For example, some retail gift cards might be good for in-store use only, but not online shopping. Buyers have to be cautious they're not purchasing a gift card in which the face value is misrepresented, Testa warns.
Consumers should also ask if there are any additional service fees involved, and they should evaluate the seller's reputation. "Always check the seller's previous feedback before bidding on a gift card," says Testa.
This may seem like a lot of work upfront, but it's important to verify as much information as possible when dealing with individual sellers. "If you're looking at a secondary market, the consumer may not have as much protection," says Testa.
If you're a member of a warehouse club, such as Sam's Club or Costco, you may be able to buy discounted gift cards from the club's store or website, says Testa. A recent search on Costco's website revealed a combo of restaurant gift cards valued at $100, but priced at $79.99.
These clubs typically offer deals for eating establishments and other companies that are not their direct competitors, says Testa.
You don't even have to be anyone's "friend" to learn about a special. A search for "discount gift cards" on Twitter yields several results from various users who simply want to share information on deals.
Testa urges caution, however. While it's possible to find out about several deals from people you don't know, buyers should only purchase the gift cards from reputable sources, he says. The offer could potentially be a fraud. "It is always buyer beware," says Testa.
Stores themselves can be a good source of discounts. Testa suggests checking with your favorite retailer often, because many can offer promotions that involve reduced prices for gift card buyers, especially around the holiday season.
For example, a store may offer a $20 gift card with the purchase of a featured product. And a restaurant may offer a $5 gift card with the purchase of a $20 card. And these deals aren't just limited to retailers. Service providers, such as spas and hair salons, also regularly offer such deals, says Testa.
Frequent flyer and credit card points programs are another source for consumers, says Testa. Many of these programs offer cash back options, too, but the gift card may have a higher face value for the points required.
Rewards can be redeemed for clothing store, flower shop and movie gift cards. Check with your credit card provider or airline program for details.