Gift Card sales hurt by economy

Gift Card sales are down this year in the same way and for the same reason that all spending is down. This is the lowering-tide-sinks-all-boats theory in reality. But there is another factor zapping gift card sales in this down economy. Giving a gift card virtually eliminates the chance to do aggressive bargain hunting.

With a keen eye and a savvy shopping touch, one may be able to find a $400 jacket for someone that has been marked downt to $150. This becomes a great gift and makes the recipient very happy. With gift cards, the dollar amount is preset and there is very little negotiation. So paying $150 for a $400 jacket becomes a much more appealing option than giving a $150 gift card to the north face.

The economy is hurting businesses in so many ways. Gift cards are not alone, they just happen to be getting hit on a couple sides.

A small dip in gift card sales does not mean that it is still not a massive industry but shrinking is shrinking any way you look at it.