Christmas Gift Cards

Unlike years ago, a current popular Christmas gift choice is the gift card. According to the National Retail Federation, an estimated eight percent of total holiday retail sales in 2003 will be from gift cards, representing $17 billion. Since the cards can be redeemed at almost any time, they have a noticeable effect on (and represent a future growing trend) after Christmas sales.

Typically, most stores will offer large discounts on their merchandise after Christmas which attracts many shoppers. Added to that traffic now is the volume of customers with gift cards. And, the gift cards don't normally count as sales until they are redeemed. As a result, the week after Christmas sales volume is anticipated to be more than 10 percent of the total holiday sales.

What is generally unknown about gift cards is that they lose value over time. Most companies charge fees on their gift cards. For example, if a cardholder doesn't redeem their Barnes & Noble or Starbucks gift within a year, they're charged a monthly fee. Gift cardholders are advised to cash in before they realize a loss in value.