Better now than later -- Use those gift cards!
Gift cards from various retailers on display at a Chevron convenience store.
TEXT OF INTERVIEW
Tess Vigeland: Well, not buying clothes for a year can seem a little crazy. But what if you could buy new
without spending money, but you didn't do it!
Comedian: Let me start with question number one: What the hell were you thinking?
Yes, it's time for another installment in our series "What Were You Thinking?" What was I talking about, pray tell? Gift cards, and the fact that just about everyone, including me, has at least one just sitting collecting dust.
Suzanne Shu is a marketing professor at UCLA. Suzanne, why do we forgo using a gift card?
Suzanne Shu: We build up these rules in our life that we can only go out and have fun when we've somehow earned it. And earned it might be that you spent a certain amount on your credit card and they're giving you a reward. But "earned it" also is very often -- and it's funny -- because with your gift cards it becomes a double level of earning it. First you earn the gift card and then you feel like you have to earn the opportunity to actually go use it and have some fun.
Shu: So you wait for a special occasion, like it's your birthday or your husband's birthday or your anniversary or something wonderful happened at work this week...
Vigeland: I have totally done this.
Shu: I have too. I have gift cards that I've received as Christmas presents. And I think, "It's a night out at a restaurant. Let's hold onto it 'til a time we can really enjoy it."
Vigeland: But in the mean time, I will go to that restaurant with my credit card.
Shu: Right. Absolutely! Because you have rules that gift cards can only be used for these special occasions. And we do this with a lot of things. We do this with... One of my weaknesses is wonderful bottles of wine, again, that people buy me as gifts, because they know I enjoy a good bottle of wine. And I think, "This is wonderful. I would never by this for myself. I've gotta save it." And wine only lasts so long, you know? So, there's a real risk that you run that these things that you're holding onto expire or otherwise become unusable.
Vigeland: Let's talk about why our brain does this, particularly with things that have money attached to them. I mean, certainly a gift card does, an expensive bottle of wine does. If I had a $25 gift certificate versus a $100 gift certificate, would I be more inclined to save the $100 one?
Shu: Absolutely. It's the really special ones that we feel like we need to create this great occasion around. Now, there's a lot of different psychology that feeds into this. Some of it is that we overestimate how often those wonderful days are going to come around.
Vigeland: There's nothing wrong with holding onto your gift cards or to a nice bottle of wine, but how do you make yourself want to enjoy that more right away?
Shu: An excellent question. There's a couple pieces of advice that I tend to give people for these situations. One is when you first receive it, at that point, it really helps to precommit to when the usage is going to be. Instead of focusing so much on "OK, I've gotta wait and find the right time to do it," really thinking about the enjoyment of it being the real outcome. If you remember the movie "Sideways," which took place here in California, and they were going up to the Santa Barbara wine country. The two main characters at one point are talking, and he says he's holding onto a very special bottle of wine. And she says, "A bottle of wine that special is the special occasion, right?" And she convinces him that you don't have to wait for a special day; you make the day around that occasion.
Vigeland: And why is that important?
Shu: Well, if you're getting enough enjoyment from the waiting, and there isn't a chance of it going bad, then I'd say go right ahead and enjoy that sort of thrill of the anticipation. But if there's a danger that you're going to forget about it and never use it then that's when you really need give yourself those deadlines, and give yourself the excuse to go out and enjoy.
Vigeland: Suzanne Shu is a marketing professor at the University of California Los Angeles Business School. Thanks so much.
Shu: Thank you.