Early this week I got a chance to use one of my Christmas presents, a $50 gift card to Outback Steakhouse. I shared dinner with someone special and the night went pretty smoothly. We got the bill for $46.39 and I handed our waiter the gift card. He returned the receipt confirming the charge and I left a $10 tip in cash.

Fast forward a couple days. I forgot what the exact balance was and wondered if trying to use the remaining balance would be worth it. So I fired up the website to check the balance and this is what I see:

Outback Gift Card Balance Screenshot

Yep, my waiter added a second charge after our meal to clear out the gift card, effectively turning his 21.5% tip into a 29.3% tip. The crazy thing is, I expected this to happen. When I saw the balance I said to myself: “Of course he did.” Interestingly enough, the only reaction I had to this was asking myself a simple question: “What can I learn from this?”

A natural response might be to say “Oh God, gift cards aren’t secure! Anyone can use them at any time. Don’t buy gift cards, you’re throwing away your money.” But the reality is the existence of gift cards is an economic phenomenon. It’s quite the conundrum that no one seems to want gift cards yet gift card sales have steadily grown since 2004, earning roughly $100 billion annually.

Some people call for the death of gift cards yet the industry is still alive and kicking. Does this sound like anything we’re familiar with in the IT world? BYOD? The Cloud? This makes me think of the quote from Victoria Ivey on Cloud Logic.

“That won’t last,” says the vocal minority.

Besides the obvious FUD observation, there are a few lessons to glean from this happening:

  • If a move is made to a less secure method (i.e. buying a gift card with a credit card), can we really get mad for getting dinged?
  • Let’s say it’s wrong (it definitely is). Then what? Is it worth going through all the trouble to get a little less than $4 back?
  • At a business/asset management standpoint, is a 7.2% loss acceptable when we already received the benefit of the transaction?

And that’s without really getting into any risk management principles.

Honestly, I’m not bent out of shape over this. The food was good minus the stale bread and the waiter was super friendly. Maybe this was the universe’s way of telling me I should have left a 30% tip. Or maybe I’m just being ridiculous. Either way, use your gift card for your meals before your waiters do for other things.

So tell me, do you think my response is appropriate? How would you have handled it differently? Do you have other lessons that can be gleaned from this?

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