One of the main reasons why retailers love to issue gift cards, is due to their high profitability resulting from a concept known as "breakage" (as described in my previous gift card post). This refers to the common occurrence whereby the full credit limit of a gift card is not redeemed by the recipient before it expires. This simply boosts the issuing company's profits as despite receiving the full amount of cash up front for the card, they benefit by only having to part with products of a lesser value in exchange.
As a consumer, it's therefore very important to know the validity period of any store gift card within your possession to ensure that you don't lose out on available credit. In this article, I've provided a summary breakdown below of all the most pertinent terms and conditions that you should be aware of for the major retailer gift cards in Australia. This should help to maximise the benefits of your spending options the next time you receive one from somebody.
On the topic of validity periods, there's been conflicting studies performed globally and locally around what impact they have on the levels of redemptions amongst consumers. Some studies have shown that longer periods of validity resulted in up to 30% (on average) of gift card credit not being used. However, studies conducted by the Australian Retailers Association (ARA) and Australian Merchant Payments Forum (AMPF) have produced contrary findings. They've shown that almost 98% of the value of gift cards are redeemed within the expiry period. These findings do imply that this is predominantly the case for gift cards of shorter validity durations though.
In other countries with more mature gift card markets, such as the USA and Canada, there's actually a push going on to remove expiry periods all together as they are seen as unfair towards the customer. In Australia the average expiry period for gift cards is set at 2 years, which in my opinion, and as suggested by the studies above, has been a calculated move by retailers in their favour. Based on my own personal experience, I believe that in reality the more time you're given within which to use your gift card, the more complacent you become making you less likely to rush out and buy something right away. This probably happens quite frequently, where the card is put into a drawer to be used another day and never actually makes it out again until it's too late.
Let's take a look now at the breakdown of all the important redemption restrictions for some of the most popular gift cards available in Australia today.
|Merchant||Denominations||Expiry Period||Important T&Cs||Valid Stores||Link|
|David Jones||Can be loaded for any value between $5 and $1000||Valid for 24-months from date of issue||Only valid for purchases in David Jones stores||David Jones Gift Card|
|Big W||All Big W gift cards can be loaded for any value between $10 and $500||WISH gift cards expire within 12-months of the date of issue||WISH gift cards can be redeemed at Big W stores as well as all other participating stores including Woolworths & Safeway Supermarkets, Caltex Woolworths or Caltex Safeway fuel outlets||Big W Everyday Gift Cards|
|Woolworths||All Woolworths gift cards can have values between $10 and $500||WISH gift cards, Essentials, Groceries Only and Store gift cards expire within 12-months of the date of issue. Return cards are valid for a period of 6-months||WISH gift cards, Store gift cards and Essential gift cards can be redeemed at Woolworths stores as well as all other participating stores including Big W & Safeway Supermarkets, Caltex Woolworths or Caltex Safeway fuel outlets||Woolworths Everyday Gift Cards|
|Myer||Myer gift cards can be loaded by any value between $5 and $500||All Myers gift cards are valid for a period of 24-months from date of issue||Myer gift cards can be presented to the point of sale in Myer Stores||Myer Gift Cards|
|Dick Smith||All Dick Smith gift cards can have values between $10 and $500||WISH gift cards expire within 12-months of the date of issue||WISH gift cards, Store gift cards and Essential gift cards can be redeemed at Woolworths stores as well as all other participating stores including Big W & Safeway Supermarkets, Caltex Woolworths or Caltex Safeway fuel outlets||Everyday Gift Cards|
|Harvey Norman||These gift cards can be loaded with the following values: $5, $10, $20, $50, $100, $200 and $500||Harvey Norman gift cards are valid for 24-months from the date of issue||Redeemable at all Harvey Norman stores around Australia||Harvey Norman Online|
|Coles||Coles gift cards can have any value between $5 and $500||All Coles gift cards are valid for a period of 24-months from date of issue||Coles gift cards are redeemable only at the retailers you purchase the gift card from, for e.g. Target, Coles Express, Coles, Officeworks, Liquorland, Vintage Cellars and 1st Choice Liquor Superstores. However, Coles and Myer gift cards are valid across all retailers||Coles Online Store|
Coles Group and Myer
|Target||Target Australia gift cards can be loaded with $10, $20, $30, $40, $50, $75 and $100||Target Australia gift cards are valid for 24-months from date of purchase||Target Australia gift cards can be used only in Target Australia stores||Target Australia Gift Cards|