Food retailers are profiting from gift card exchange programs whereby shoppers can trade in unwanted department store and restaurant gift cards for credit equaling a percentage of their value at places like United Supermarkets and Walmart.
After a successful pilot of its Trade In, Cash Out program in Lubbock, Texas, the United Family implemented the gift card exchange program across its United Supermarkets, Market Street and Amigos banners in December.
Trade In, Cash Out allows shoppers to trade in eligible gift cards for cash equaling up to 80% of the gift card’s value. Shoppers also have the option of receiving a credit equal to an even higher percentage if they trade in their gift card for store credit at United, explained Kris Burdis, center store business manager for The United Family.
“What differentiates us is that you can walk into one of our stores with a gift card and you’ll walk out with cash,” he said.
The program is facilitated in partnership with Card Zone, which pays United a commission for the cashed in gift cards. It then resells them at a discount.
“I’ve been impressed with the program’s popularity, especially during the few days after Christmas,” said Burdis, who could not provide specifics.
Walmart launched a similar test in partnership with Cardcash.com, on Christmas Day. As part of the program, Walmart will transfer up to 97% of the value on gift cards from over 200 retailers and restaurants, to a Walmart e-gift card, at walmart.cardcash.com.
Participants do not need to mail in their gift cards. Rather, the transaction is completed online and the Walmart credit is emailed to recipients within about one to two hours.
“We’ve found in the past that people really like versatile gift cards like Walmart’s,” said Jeremy Levi, director of marketing for Cardcash.com, which facilitates a similar service for Amazon.
Like Card Zone, Card Cash resells the gift cards that are cashed in, at a discount which is funded by the loss that sellers take when cashing in their cards.
“We don’t pay full value for a gift card so let’s say a $50 gift card would net about 80% of the value. So you might get $40 back in trade in value. We’d then sell it to the next person for $45 and they’re happy to get the 10% savings,” Levi explained.
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