OGDEN -- E.K. Valentin doesn't quite grasp the advantage to holiday gift cards over cash, but as a Weber State marketing professor, he felt bound to study them.
"They really don't make sense from an economic standpoint," Valentin said of gift cards. "You are trading a high degree of liquidity of cash for a more restricted gift card, which may have to be used at a specific store. Recipients can spend cash on anything they want, and givers save hours of shopping time -- but noncash gifts remain the most popular because of their emotional and symbolic aspects."
But after being asked to talk about gift cards over several semesters, Valentin and fellow marketing professor Anthony Allred, of WSU's John B. Goddard School of Business & Economics, decided to research the subject.
The professors surveyed 317 people throughout Northern Utah for their "Giving and Getting Gift Cards" research. Their findings were published in the "Journal of Consumer Marketing."
According to most who responded, cash-like gift cards that can be spent on ordinary, everyday household items have no more charm than does cash.
But people surveyed had more positive feelings about gift cards for specialty stores perceived as purveyors of luxuries or indulgences.
"Cards for restaurants or department stores were viewed more like traditional gifts," Valentin said.
Gift cards that were seen as fairly equivalent to cash were for big box stores, including Target and Walmart, he said.
"With those cards, you can always spend the money on groceries you would buy anyway," Valentin said. "A $20 gift card would, in effect, leave $20 in your wallet that you could apply toward an expensive watch or something else you wanted, so those cards are perceived as about as charming as cash."
Survey respondents slightly preferred Target cards to those from Walmart, Valentin said, possibly believing Target was more upscale, he speculated.
Gift cards purchased to be redeemed at electronics stores, department stores or restaurants, drew more approving responses from those surveyed.
"People feel less guilty about spending gift cards on personal luxuries," Valentin said. People who might be less likely to spend cash on jewelry or electronics will do so with less guilt when they are redeeming a vendor-specific gift card, he said.
The downside is that a $50 gift card for a jewelry store doesn't go far.
"There's not much you can buy at a jewelry store for $50," Valentin said. "People might feel forced to spend the gift card on something they otherwise wouldn't buy. Fifty dollars is not really enough to indulge."
Cards to luxury stores are more satisfying if they are for a greater amount of money, the survey revealed.
The survey also showed that the choice of a gift card may depend on the emotional closeness between the gift giver and the receiver.
"We found that whether the giver/getter relationship is close or distant seems to have an effect on which kind of cards the givers are inclined to give," Valentin said. "You are more likely to give general gift cards to distant acquaintances, to discharge an obligation."
So does Valentin like to spend holiday gift cards?
"I have everything I need," he said. "I don't need anything."
And does he give out gift cards?
"I don't give anything," he said. "My wife does all that. And I'm not sure if I told her about the research paper."