The Death of GiftCardMall
Update: As I reported earlier, the site temporarily reverted back to its old state, but the new version has returned along with the $250 limit.
Update 2: There is a backdoor link that still works for $500 cards, however it does not work with portals. You can find out more info here.
This morning I awoke to a comment from Michael on my recent post about negative changes at GiftCardMall. In that post I described how the company was cancelling many orders and how they had altered their designs to prominently place the word “Gift” on them. Michael’s comment alerted me to a stunning development.
The Return of GiftCardMall for MS
Before we go over the new changes, lets get a little background. A couple of months ago GiftCardMall once again began offering cashback through portals for the purchase of Visa gift cards. That was huge, because without the cashback, buying Visa gift cards through GiftCardMall for MS just didn’t make sense considering the cost.
At the time, I showed how a purchase of a $3,000 (6 x $500) in cards through GiftCardMall lowered the overall cost of each card down below $5 or 1% of the face value. Since these cards can easily be loaded to Bluebird/Serve or REDbird, this made it a simple avenue of manufacturing spend.
The New GiftCardMall Visa Program
Well, things aren’t so simple anymore. Today GiftCardMall made some major changes to their Visa gift cards. First off, they added a ton of new designs which are very nice. They also ship a greeting card with each order to go along with the gift. None of those things matter to us though.
The big change that effects us is the maximum denomination. It has changed to $250. Unfortunately this change means that GiftCardMall no longer makes sense for manufacturing spend, which is perhaps their goal at this point. It is obvious based on this development that the company didn’t want to take on the risk.
Old & New Math
In my original post, I calculated the cost for $3,000 (6 x $500) in gift cards. Here it is:
- Initial cost: $3042.54
- Cashback: -$15
- Total cost: $3027.54
- Cost per $500 card: $4.59
- Cost percentage: .009
Now lets look at the new cost of $3,000 (12 x $250) in gift cards:
- Initial cost: $3082.35 (Each card carries at $5.95 fee + shipping is $10.95)
- Cashback: -$15
- Total cost: $3067.35
- Cost per $250 card: $5.61
- Cost percentage: .022
So as you can see, under the new system, the cost of a $250 card is more than the cost of a $500 card under the old system. This means that the cost to MS with GiftCardMall has more than doubled from less than 1% to 2.2%.
As part of these changes, they seem to have streamlined the shipping options. You can no longer get normal first class postage, but instead can do Priority Mail or UPS shipping. All delivery options now require a signature as well for purchases over a certain amount. (The $3k order triggers the signature requirement although I am not sure of the limit.)
GiftCardMall is now essentially dead as a method of manufacturing spend. This may still be a good option for gifts since they have enhanced their designs and improved their website, but most of you probably aren’t interested in that.