> Why would you sell a dollar for 90 cents? Because you know that on average you're selling quite a bit less than a dollar.
There's more to it than covering the risk of fraud. It's more about optionality. The gift card only allows for buying things at one place — so you're restricted in what you can buy, can't deposit it at a bank, can't comparison shop etc.
I don't get the sense that money being left on the card is a serious issue for the sort of person who goes hunting for deals like this. They'll eventually spend more than the card's value and have the last of it apply partially to some purchase.
Also the discount rates I've seen have been more like buying the $100 card for $95 or $97. Except perhaps where the gift card retailer is offering it directly as part of a cross-promotion deal with the target retailer.
There's more to it than covering the risk of fraud. It's more about optionality. The gift card only allows for buying things at one place — so you're restricted in what you can buy, can't deposit it at a bank, can't comparison shop etc.
I don't get the sense that money being left on the card is a serious issue for the sort of person who goes hunting for deals like this. They'll eventually spend more than the card's value and have the last of it apply partially to some purchase.
Also the discount rates I've seen have been more like buying the $100 card for $95 or $97. Except perhaps where the gift card retailer is offering it directly as part of a cross-promotion deal with the target retailer.