GC (Gift Certificates) Problems – Some Not Being Honored as Expected

GCs (gift certificates) have become the currency of choice for giveaways, for reasons we can easily figure out. Although cash will always be king, I am all for using GCs as incentives, especially if it will help save everyone from unnecessary deductions (if you know what I mean). 

Generally, gift certificates (more commonly called GCs), are awesome to use. I especially like the ones from big stores / brands that I rarely have any problem using. Some of them can even be used partially, for example, you can just use P300 from a P1,000 GC and have a balance of P700 that you can still use next time. And thanks to the DTI, since July 2012, they don’t have expiration dates anymore. I AM VERY THRILLED TO RECEIVE GIFT CERTIFICATES (from the honest companies!); I think everyone would be happy with them!

However, in the past few months, I and people I know have encountered problems with some GCs not being honored as we expected. How about you? Did you run into any problems using GCs?

Gift Certificates Should be As-Good-As-Cash

When I receive a GC, it is my understanding that I can use that GC as if it were cash. Whoever gave it to me paid for the GC in cash (or its equivalent in kind, service or barter or earning points) to get the GC equivalent. If it was sold to the “gifter” on a discount, that is not my (giftee’s) problem, nor should it be used against me by imposing restrictions on my use of the GC. If you gave it to me as a prize, I also expect it to be as good as cash.

DISHONEST TACTICS

There are some dishonest companies out there. There was one in particular who promoted that they will be giving out GCs, but it turns out all they were giving out were 10% discount coupons! They kept calling their 10% discount coupons GIFT CERTIFICATES (and funny enough, they can only be used on regular items, while they were promoting their ONGOING SALE!). I got the feeling that it was not “just an honest mistake”, but to give them the benefit of the doubt, it is possible that they were just using the wrong term. Still, most of the potential customers who participated in the activity felt like they were lied to (niloko).

To make sure we are all on the same page, this is the definition of GIFT CERTIFICATE from Merriam-Webster:

Gift Certificate

a piece of paper that is worth a certain amount of money and is given to someone to be used like money to pay for things (such as the products or services of a particular business)

see the description “used like money to pay for things”?

Don’t call it a gift certificate to fool people, when what you are giving out is actually a voucher / discount coupon / etc…

COMMON GIFT CERTIFICATE RESTRICTIONS ENCOUNTERED

Some of the restrictions / conditions I have encountered over the years:

1. Expiration dates – fortunately, this has been addressed by the DTI. Gift checks / certificates should no longer have expiration dates. Unfortunately, many small companies still do this, especially when giving GCs away as “prizes” to customers, bloggers, etc… some GCs with only 1 – 2 months before they expire. I have had so many GCs expire on me this way. I think if a company was giving out GCs as a “prize,” it should be as good as cash. However, if they were just giving out promotional vouchers, the expiration date is okay. Just be honest about it and call it a promotional voucher, NOT a gift certificate.
2. Minimum spend – some companies will only let you use your GC if you spend at least a certain amount. For example, they give a P300 GC but the minimum spend is P800. That’s great if I really had any interest in visiting their business. Most of the time, these GCs just get wasted on me or I try to give them away instead. I am not thrilled to receive these types of GCs, even if they are free. Instead of the business getting goodwill from me, I am instead annoyed. We generally try to spend a little over the GC amount and pay cash for the amount over the GC value, but forcing customers to a minimum spend in order to use their GCs just leaves a bad taste.
3. Cannot be used on sale items – why? It’s as good as cash! I have encountered this a few times, and J encountered this just last weekend. More on that story below. Anyway, this whole GC-cannot-be-used-on-sale-items thing is just so bogus! It shouldn’t matter whether I want to buy a sale item using a GC or with cash. The GC is actually like prepaid credit already. A P500 GC from Company A should entitle me to purchase P500 worth of items from Company A. I get that the company doesn’t make as much money if I used the GC to buy sale items instead of regular items, but that GC is already mine and is already paid for or earned. It is actually Company A who owes me P500 worth of goods or services. The whole restriction is actually just a ploy to get customers to spend their GCs on higher margin items, and the sad thing is, the company already has your money (since you bought and already paid for the GC in advance). This is just them not letting you use your money as you see fit (money that you earned or paid for in advance), since they already have control of the money (that you gave them in advance).

Planning on giving someone gift certificates?

What a nice person you are! Can we be friends? LOL.  If the GC is something you received and can’t use, sure, give away. Better that someone else makes better use of it. However, if you are planning to spend money to buy a GC for someone, please consider if it wouldn’t be better to give cash instead, or stick with the tried-and-tested companies.

If you still think giving GCs is the way to go due to some factors like safety, accountability, audit tracking, culture, “it was on sale”, etc… think about whether the recipient will easily be able to use the GC. Does the recipient have to go out of their way or make a lot of extra effort just to use the GC (for example, the location of the store is very far from the recipient)? Does the GC impose restrictions and conditions to use it? If the answer is yes, please find another company to buy the GC from or just give cash.

Does your recipient really like the company you bought the GC from and visit them regularly? Or does the recipient need cold, hard cash? If you know they are strapped for cash, just give cash. They’ll just end up selling the GCs for 10% less, if they are lucky and someone wants to buy the GCs from them. If they are not lucky, they might end up selling the GCs to the underground GC buyers who buy them for 20 – 30% less, with the added headache of having to go the the GC buyer’s offices. What you thought was a thoughtful gift might turn out to be not so thoughtful.

GIFTAWAY.PH & Timex

Okay, let’s get to the story that had me writing this post about GCs. J works at a company that uses Giftaway.PH as one of their employee rewards programs. I don’t want to get into the details, but J earns points in Giftaway, and these points can be converted into electronic GCs. Giftaway.PH has a list of participating merchants to choose from.

J has been thinking about getting a replacement daily beater watch ever since his G-Shock strap broke some time ago. It wasn’t really that important to him, but since he had some points on Giftaway, and saw that Timex was on the list, he thought he could convert his points to a Timex GC (P1,000) and just add cash so he can finally get a new watch. Personally, I am more into Japanese watch brands, but Giftaway apparently only had Timex.

We went to Megamall last weekend and he picked out a nice chronograph (men and their gizmos!). I insisted that it should be stainless steel this time (leather straps tend to stink after a while, while rubber ones look very “kiddy”). It was the best looking piece we could find, and fortunately, it was also at 30% OFF, not surprising since more than half of their items were also discounted. We asked if they accepted Giftaway eGCs and they said yes.

After trying it on, J decided to buy the chronograph. He provided the Giftaway eGC code and we thought all was well until the Timex guy told us that we can’t use the GC on sale (yellow tag) items, but that it can only be used with regular items. We told them that it was written on the Giftaway website that the GCs could be used on any product or service purchase, and nowhere did it say that the GCs can only be used for regular items.

The Timex guy called someone on the phone to check, and confirmed to us that they really do not accept Giftaway GCs for sale items. It was so disappointing! P1,000 might not seem like a big discount, but it’s still P1,000, ‘ya know? And it’s the principle of the thing. It was a P1,000 GC that J earned and had a right to use, that Timex would not honor.

We did not buy the watch and left Timex.

The next day, J emailed Giftaway to tell them about the incident and request that the P1,000 GC points be credited back to his account. He’ll be using it on another company instead. To Giftaway’s credit, someone responded to J’s email right away (see below) and confirmed that the GC can be used with sale items:

From: Giftaway [mailto:[email protected]]
Sent: Monday, January 18, 2016 6:14 PM
To: J
Cc: ****
Subject: Re: Complaint Regarding Timex Megamall – And Other Branches

Hi J,

We have received feedback from their head office that it was their mistake. They are getting in touch with their operations manager to hopefully resolve this for good.

And yes, you can use it for any item. (emphasis mine)

Thank you,
Giftaway Team

 

On Mon, Jan 18, 2016 at 5:59 PM, Giftaway <[email protected]> wrote:

Hi J,

Thank you for sharing this feedback. They do and we reminded them last week because a customer at their Iloilo branch had a similar feedback about sale items.

We will relay this to their management.

Thank you,
Giftaway Team

So apparently, this sort of incident has happened before. Good thing that Giftaway was very responsive and knew how to handle this type of situation. The points were credited back to J without any problem. As of this writing, we have not heard from Timex, not that we expected them to reach out to us or anything. As long as J’s Giftaway points were credited back to him, that’s all that matters.

It was just such a bummer because if Timex had only honored the GC, we would have gone home with a new watch. It was also a waste of our time. Now, they say that the watch J wanted was already bought by another customer.

So, anyway, that was what happened last weekend that led to this long post about gift certificates! Sometimes if you have gift certificates instead of cash, it seems like some companies treat you like a second-class citizen. ‘Coz your GC just ain’t as good as cash, ‘yo. Which is funny, since they are the ones who sold the GCs to you in the first place (or to the person who gave you the GC).

Please feel free to share your experiences in the comments!