Gift card sales continue to climb with a projected spending of $24.78 billion, based on the National Retail Federation's 2010 Gift Card Consumer Intentions and Actions survey. Although NRF estimates that Americans spent an average of $145.61 on gift cards, up 4% from 2009, and approximately 55.2% of adults asked for gift cards this past holiday season, many cards still go unused - approximately 10%. So what should you do with those unwanted gift cards?
Selling unused gift cards online is nothing new, but CardWoo entered the growing gift card resale market with a slightly different payment model. Instead of logging onto a resale website and receiving a payment estimate beforehand like competing websites, such as Plastic Jungle, GiftCardRescue, and Cardpool, CardWoo asks its customers to mail in their unwanted gift cards first, and then sends out a payment check.
Like its sister company, Cash4Gold, CardWoo heavily markets online and via television ads, but tends to offer less money than competitors. Although CardWoo does guarantee a payout between 50%-90% of the card value, a sample test conducted by SmartMoney resulted in only a 50% payback for unused gift cards. Sellers generally receive upwards of 60% back on their cards through various gift card exchange websites and online auctions.
By forcing customers to send in a gift card before offering a value estimate, CardWoo may seem like a gamble to potential sellers, but it compensates for the system by offering customer service.
Most online exchanges provide free shipping, but CardWoo additional pays for insurance on shipments. If a seller is unsatisfied with the company's monetary offer for the gift card, within the first 14 days of receiving their check, sellers can get their gift card back for no additional charge. Another advantage that CardWoo offers is accepting cards with lower minimums than other resellers. While most websites will not accept cards with values less than $25, CardWoo will accept any gift card with at least $20. CardWoo is even offering 10 $50 gift cards to CardWoo members once its Facebook page reaches 2,500 fans to drum up more business in its market.
It seems like CardWoo has its perk system figured out, but when it comes to getting the most money out of unused gift cards, it may fall short of its competition. Just as shoppers compare prices, sellers need to be aware of all their options as well. Before committing to a specific online gift card exchange, request quotes from companies and if possible, see what comprable cards are selling for already. Since resellers tend to have similar sales margins, a more expensive listing for a similar gift card will mean more money in your pocket.
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