This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Americans Squeeze More Value From Gift Cards, Even As Stored Balances Soar

Savvy shoppers and consumer-friendly regulations will keep more value on holiday gift cards than ever before, according to researchers at an executive think tank. In a statement to reporters, representatives from CEB TowerGroup Research said that nearly 85 percent of the U.S. population exchanged prepaid gift cards during 2012, for a total of over $110 billion in stored value.

However, as a result of the Credit CARD Act of 2009, retailers and gift card issuers can't pocket leftover funds on most gift cards until at least five years after their last load. CEB's research shows that "gift card spillage" dropped from $8 billion per year in 2007, to just under $1.7 billion in 2012.

CEB TowerGroup officials credit the proliferation of "open loop" gift cards with much of the market's expansion. Bearing Visa, MasterCard, American Express, and Discover logos and redeemable at most retailers, open loop gift cards account for much of the industry's growth over the past five years. Researchers reported that 75 percent of consumers redeem these gift cards in full, while 30 percent of consumers will spend as much as $25 in cash to complement their gift card redemptions.

Research also indicates that physical gift cards remain far more popular among gift-givers than electronic vouchers. E-cards accounted for just $3 billion of the gift card market in 2012, especially as holiday shoppers picked up attractive, last-minute gift card packages at supermarkets, banks, and convenience stores. CEB TowerGroup senior research director Brian Riley told reporters that the "variety and assortment of gift cards available" helped gift givers pick cards that their recipients will actually use.

At this rate, researchers said, the gift card market could top $130 billion in annual sales by 2015, with electronic gift cards accounting for about 15 percent of the industry's revenues. With sustained demand for gift card activations at retail locations, American Express and Chase have expanded plans to use the same channels to support new prepaid debit card products.


Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,600.58 +243.71 1.40%
S&P 500 2,039.19 +26.30 1.31%
NASDAQ 4,705.8910 +61.5790 1.33%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs