• by Tanya Gazdik , November 23, 2007

Consumer Reports is conducting its second annual public education campaign, warning holiday shoppers of the pitfalls associated with the ubiquitous gift card.

Separately, a new company/online service called Leverage is helping consumers to better manage gift cards they buy and receive.

The effort includes a holiday shopping hub on www.ConsumerReports.org that will offer tips on how to avoid gift card snags and provide a place for consumers to share their stories about problems with gift cards. Nearly $8 billion in gift cards went unredeemed last year, according to TowerGroup.

Gift cards are expected to be a major component of holiday giving, with estimates putting sales at more than $100 billion in 2008. And according to Consumer Reports' survey, 62% of consumers are planning to buy gift cards this season, many of which will be bought online. Consumer Reports' survey also found that when the time came for consumers to redeem their gift card, the majority of consumers also spent their own money, with 60% spending more than the value of the card.

Leverage is a way for consumers to manage an array of gift, reward and loyalty resources online. Users can perform the following tasks online with a single, free online application including purchase, track and exchange gift cards from retailers who are online; earn interest on gift card balances; enroll in and manage loyalty and rewards programs; receive targeted offers and savings from retailers based on gift card holdings, as well as self-reported demographic, psychographic, gift occasions and travel calendar information and maintain complete privacy of all personally identifiable information.

Users create an account and profile, and then register their gift cards, reward and loyalty program information. This information is securely collected from participating partners, aggregated and presented to users in a friendly and intuitive interface. Changes across all accounts are visible immediately as they occur.

Leverage also gives advertisers an opportunity to deliver relevant and timely messages to users based on self-reported, non-identifiable information. When users log in to their Leverage account, they are invited to view their offers and savings from retailers in a format that is similar to an email inbox.

The promotional messages are accompanied by a key that provides insights into each merchant's targeting rationale. Criteria include non-personally-identifiable demographic and geographic information (age, gender, and location), recent gift card transactions, loyalty program membership, or an upcoming gift occasion. This transparency provides consumers with far more control over the timing, volume and relevance of advertising.