Update 12/15/11: Blockbuster has started selling gift cards again. The old gift cards are still not accpeted for payment; however, I'm told old gift cards will be exchanged for 5 free movie rentals and blockbuster employees can not check the balance of old gift cards. My thougts here.
The Blockbuster gift card became worthless five months ago. Late March 2011, Consumers were given just two weeks notice to redeem their gift cards or lose their value. Unfortunately, two weeks is not nearly enough time to get the word out to gift cardholders; there are still many who are unaware the gift card they own is now worthless.
This event was a result of DISH Network, Inc. purchasing the Blockbuster business and choosing not to accept outstanding Blockbuster Gift Cards.
To be fair the Bankruptcy Court did not require the buyer of Blockbuster to honor outstanding gift cards. In either case, DISH Network could choose to accept Blockbuster gift cards at anytime.
As more time goes by, the chances of Blockbuster Gift Cards being honored become less likely. If you own a Blockbuster Gift Card, don't throw it away, yet. There is a chance it will be accepted at some point in the future.
Here are a few reasons Blockbuster should choose to accept the gift cards:
1. Not Accepting Is Bad For The Brand
When a company is purchased out of bankruptcy and the business maintains the same branding, locations and staff, it's hard for consumers to understand why their gift card is no longer accepted. Understandably consumers feel duped by the new owner. Just take a look at the blockbuster gift card complaints listed as comments from my original blog post covering this matter.
For example, one woman writes:
"I spent an hour looking for movies to rent as well as my little kids. Once we were ready to check out and pay for the movies we wanted to rent using the blockbusters gift card, I was told they were no longer acceptable cuz Dish networks bought out blockbusters. I had never seen any postings or warnings about it. My kids and I walked out without any movies. What a disappointment and shame. The stores are still called Blockbusters instead of Dishbusters. Why?!"
Unfortunately, DISH Network is more concerned with acquiring Netflix's customer base than retaining the existing Blockbuster customer base which own gift cards. In fact, my local Blockbuster has a huge sign reading: "Tired of seeing red? Say hello to Blockbuster".
I say Blockbuster has it's gift cardholder singing the blues.
2. Not Accepting Is Bad For Consumers
When DISH Network acquired Blockbuster it was not announced how many gift cards or the total dollar amount of which was expired. One can assume the outstanding balance of gift cards is significant because it was specifically excluded from the purchase agreement by the Bankruptcy Court. Furthermore, DISH Network has decided not accept the gift cards and in turn damage the brand it acquired.
As a result of their decisions, Dish Network, Blockbuster and the Bankruptcy Court have taken money out of a lot of consumer's pockets.
3. Not Accepting Is Bad For Gift Cards
It's no secret, gift cards often receive a bad rap from the media and consumer advocates. At ScripSmart, we think there is more to the story than "give cash not gift cards" advice. Events like this are a big reason why consumer advocates do not like gift cards. Unfortunately, this scenario will be played out again in the future, only with different names as buyers and sellers.
ScripSmart offers a list of gift cards to avoid, Gift Card Scores, and free user accounts to help consumers get the most from their gift cards. One step gift card issuers could take is a money back guarantee. Basically, the business would keep the money with a trusted third party and should the business go under, the cash is safe and consumers can get a refund for the gift card. Unfortunately, there is no gift card which offers such a guarantee.
In the meantime, be sure to take a look at the Gift Card Score before making your next purchase.
