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Is a $200 Nordstrom Gift Card Worth More or Less Than a $200 Gap Gift Card? The Asymmetric Valuations of Luxury Gift Cards

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  • Gunasti, Kunter
  • Baskin, Ernest

Abstract

Gift cards account for a $200 billion market in the US, yet little is known about consumers’ preferences and valuations of different gift cards. We examine how average US consumers feel about exchanging luxury brand gift cards (LGCs) versus non-luxury brand gift cards (NLGCs). Using secondary data analyses, surveys, and experiments, we demonstrate two asymmetries: between valuations of LGCs versus NLGCs and between valuations of gift cards by givers versus recipients. We show that LGCs are valued less than NLGCs with identical price tags. LGCs are more likely to be swapped or sold. Resellers demand and buyers pay lower prices for LGCs. These effects are mediated by the perceived utility of the gift cards as gifts and moderated by a person’s role in the gifting process. Gift givers value and prefer to give LGCs more, whereas recipients prefer and value NLGCs more.

Suggested Citation

  • Gunasti, Kunter & Baskin, Ernest, 2018. "Is a $200 Nordstrom Gift Card Worth More or Less Than a $200 Gap Gift Card? The Asymmetric Valuations of Luxury Gift Cards," Journal of Retailing, Elsevier, vol. 94(4), pages 380-392.
    • Handle: RePEc:eee:jouret:v:94:y:2018:i:4:p:380-392
    DOI: 10.1016/j.jretai.2018.07.002
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    References listed on IDEAS

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    Cited by:

    1. Reshadi, Farnoush, 2023. "Failing to give the gift of improvement: When and why givers withhold self-improvement gifts," Journal of Business Research, Elsevier, vol. 165(C).
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    3. Carlson, Jay P. & Paul, Iman, 2022. "Pick a card: Price ranges and gift card choice," Journal of Retailing and Consumer Services, Elsevier, vol. 65(C).
    4. Khouja, Moutaz & Hammami, Ramzi, 2023. "Optimizing price, order quantity, and return policy in the presence of consumer opportunistic behavior for online retailers," European Journal of Operational Research, Elsevier, vol. 309(2), pages 683-703.
    5. Cheng, Andong & Baskin, Ernest, 2021. "Disproportionate redemption discounting: Mental accounting of discounted credit," Journal of Business Research, Elsevier, vol. 128(C), pages 156-163.

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