July 30, 2010

Guide for Selling Gift Cards on Craigslist

Header for CraigslistThere are numerous online websites for selling unwanted gift cards with their own strengths and weaknesses. Most of these websites either charge a fee or offer to purchase your gift card at a deep discount. However, Craigslist.org is a FREE option for selling gift cards at a good price if you are willing to put some time and legwork into it.

If you are not familiar with Craigslist, then think of it as a large online bulletin board with millions of classified ads. It is the seventh most visited website in the US, 33rd worldwide, with 20 billion page views per month. Most classified ads, except for job postings, are free to post. The only restriction for selling gift cards on Craigslist is that the gift card must be transferable. One down side of Craigslist is that there is no user reviews of buyers or sellers. This step by step guide will walk you through how to safely and successfully sell your unwanted prepaid cards on Craigslist.

Before proceeding any further, it is important to understand there is inherent risk with selling gift cards on the secondary market. It is possible to minimize some of the risk, but not completely eliminate all the risks. Staying vigilant, using common sense, and posting cash only transactions on Craigslist.org should help.

Step 1: Assemble and Verify Remaining Balance
Begin by finding all unwanted gift cards you want to sell. Look in your wallet/purse, under the sofa, on the bookshelves, deep in the back of drawers and cabinets, etc. If there is a gift or purchase receipt for the gift card, excellent keep that receipt. After you have found all the gift cards you want to sell, the next step is to verify the remaining balance. It is important to verify the amount without removing the security foil covering the PIN, typically on the back of the gift card. The best way to do so is to visit the store and have a clerk verify the amount. It is possible to verify the balance online and via the phone, but this would require revealing the PIN code. Buyers will be hesitant to purchase gift cards that have the PIN revealed as this is a major security risk.

Step 2: Research Resale Price
Search GiftCardNexus.com for resale value
The second step in selling your unwanted gift card is to research how much the card is worth on the secondary market. GiftCardNexus.com does a good job of tracking true gift card resale value by analyzing hundreds of thousands of gift card transactions. Do a quick search for the gift card brand or browse by category (Refer to above illustration).
Metric, resale value for Home Depot gift card

If the retailer for the unwanted gift card is not listed on GiftCardNexus.com, then pick a comparable less popular brand as a proxy for the resale price. The average and/or median resale value is a good starting point to price the selling price of your gift card. If you want to encourage more people to respond to your ad, then use a lower resale price. Price it higher if you want to get more money for it. If no one responds to your ad, then re-post it later at a lower price. It is free to re-post on Craigslist.

For example, as of July 26 GiftCardNexus.com reports that Home Depot gift cards have a 92% average resale price with a ±3% deviation. This indicates that over two thirds (2/3rd) of gift card are sold between $0.89 and $0.95 on the dollar. Pricing the gift card between this range would be good. Be sure to round up the full resale price to the nearest dollar as this makes cash only transaction easier. Another pricing strategy is to knock a nickel or penny off the price. This gives a psychological perception to the buyer that the gift card is less than it really is. For cash transaction, this is still easy to handle, as you would give the buyer a nickel or penny back.

The selling guide continues with how to post an effective classified ad on Craigslist.

Let us know what you think of the guide. Also, if you have experience with selling or buying gift cards on Craigslist we would like to hear from you.

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