Eli5: How do stores benefit from selling gift cards?

Question

Eli5: How do stores benefit from selling gift cards?

In: 2

Answer 1

If you’re asking about Walmart selling Google Play / Amazon / whatever gift cards, they get a commission on the sale, in the neighbourhood of 5%.

If you’re asking about Walmart selling Walmart gift cards, it’s even simpler, they encourage you to shop at their store. If you buy a gift card as a gift, you’re directly encouraging someone else to shop at that store. And most users will spend a little extra on top of the gift card value, or even return to the store after they’re acquainted with it.