Buying Disney gift cards at Target

[SL6827]

Still no. Target doesn’t make a penny when you buy gift cards from a 3rd party. They’ve already made that money when they sold the card. If they can entice/force you to use it on a higher profit product (i.e. not a gift card), they will make more money. If you never use the gift card at all, that’s even better for them.

So how much do they make on selling other gift cards then? Have any idea? I can see them wanting you to buy a higher profit margin item, but I wonder just how little they make off selling other gift cards. You would think that something has to be made considering almost every store out there seems to sell them.

 

[gottalovepluto]

Still no. Target doesn’t make a penny when you buy gift cards from a 3rd party. They’ve already made that money when they sold the card. If they can entice/force you to use it on a higher profit product (i.e. not a gift card), they will make more money. If you never use the gift card at all, that’s even better for them.

Not really. It sits on their books as a liability as they cannot book the revenue until you redeem it.

 

[PerfessorZ]

Not really. It sits on their books as a liability as they cannot book the revenue until you redeem it.

It's an interest free loan. They have to show it as a liability for accounting purposes, but you can't say it doesn't benefit them.

 

[PerfessorZ]

So how much do they make on selling other gift cards then? Have any idea? I can see them wanting you to buy a higher profit margin item, but I wonder just how little they make off selling other gift cards. You would think that something has to be made considering almost every store out there seems to sell them.

I don't know the exact numbers for each card Target sells. However, I did research Best Buy's corporate gift card margins awhile back and if you were willing to buy at least $50k at a time, you could get them for 93 cents on the dollar, or a 7% discount. My guess is that Disney discounts their cards something comparable, say in the 6-9% range.

 

[SL6827]

I don't know the exact numbers for each card Target sells. However, I did research Best Buy's corporate gift card margins awhile back and if you were willing to buy at least $50k at a time, you could get them for 93 cents on the dollar, or a 7% discount. My guess is that Disney discounts their cards something comparable, say in the 6-9% range.

Not a big profit margin at all, but I was guessing in maybe in the 5% range. All very interesting because I have wondered what all the stores, not just Target, make on gift cards now a days. I mean, there are not that many stores I go to that don't have a selection of dining or shopping gift cards to boot. I believe it is just a matter of time before Walmart will end the ability to purchase gift cards with gift cards.

 

[Wubar]

I'm sure Target isnt going to suddenly announce bankruptcy because shoppers can no longer purchase Disney GCs with Target GCs. So not shopping there because they ended this policy isn't going to put them under. Much like all of those people swearing off Disney because of all of their perceived nickel and diming tacticd isnt going to stop other visitors from rolling through the gates.