04/06/11 UPDATE: Dish Network's offer for Blockbuster was approved by the U.S. Bankruptcy Judge Burton Lifland.
Today is the first day you can no longer use the Blockbuster Gift Card for merchandise or services. We've been sending out Gift Card Alerts to ScripSmart Users who had registered the Blockbuster Gift Card in their account for months. (The service is free, sign up here.)
Yesterday it was announced, DISH Network Corp. had reached an agreement to buy Blockbuster for $320 million. One of the stipulations of the sale: gift cards did not have to be honored by the new owner (regardless of the purchaser).
As such, Blockbuster gave a two week notice to consumers and POOF!, Blockbuster Gift Cards are now worthless. The company also stopped selling gift cards when they learned Blockbuster Gift Cards would no longer be accepted after April 7th, 2010.
We've moved the Blockbuster Gift Card to the Gift Card Graveyard where it will rest with the other worthless gift cards.
Rising From The Grave
Dish Network has the option to start accepting Blockbuster Gift Cards again. Yesterday, we asked Dish Network's Francie Bauer if there were any plans to accept the Blockbuster Gift Card and she told said, "It's too early to tell, as the deal isn't finalized yet. Stay tuned."
Here are several of the things Dish Network will consider when deciding whether or not to accept outstanding Blockbuster Gift Cards:
- Customer loyalty: Consumers don't like getting burned, they don't even like hearing of others getting burned. Discontinuing a gift card program while keeping the doors open is sure to leave a bad taste in peoples mouths. The fact is, consumers don't really care if there's a new owner; if the doors are open, the staff is the same, the brand is intact and a membership is still good, gift cards should be accepted.
- Future Business Model: Clearly Blockbuster's current business model is not working. Dish Network certainly has plans for the future of Blockbuster. The question remains: is Dish Network simply interested in converting the existing blockbuster customer base to Dish Network customers with in-store merchandising and promotions or do they want to revive the Blockbuster brand and make it a part of the Dish Network offering.
- The gift card marketing opportunity: Gift cards offer a great way to market and sell products to consumers; Dish Network will need to determine if this is a marketing channel they want to continue promoting.
- Being the good guy: If Dish Network chooses to accept gift cards, they'll receive goodwill from the public and appear as the company who saved Blockbuster and it's gift cardholders, not the company who capitalized on Blockbuster and gift cardholders.
- Time: Dish Network's offer is pending approval. There is hearing tomorrow and if there are snags in the process and more time goes by, it's less likely gift cards will be accepted.
- The value of outstanding gift cards: there's no doubt the totally value of unredeemed gift cards will be a known figure. Dish Network will balance the value of all the points above with the cost of accepting outstanding gift cards.
All things considered, there is a reasonable chance Dish Network will choose to improve the image of Blockbuster by accepting gift cards. However, as of today we've no choice but to consider it worthless. The fact remains: if you own a Blockbuster Gift Card, you simply can't redeem it for merchandise or services anywhere.
Let's hope Dish Network does the right thing and brings the Blockbuster Gift Card back to life.
Remember, ScripSmart provides a free alert system for you gift cards. Just register the cards you own and we'll send you a note if we hear the gift card might soon become worthless. Sign up here.