You Can Use iTunes Gift Cards On Apple Products – For Now
Some interesting news came out of Apple today, and no I am not talking about the stock split. Apple is going away from their two card system, iTunes and Apple store gift cards, for a one card catch all. This is good news in the short term since you can use iTunes gift cards on Apple products. If you are taken advantage of any recent iTunes gift card deals then you are in like Flynn. Having said that, I fear the destruction it will do long term. This change could wreck havoc on the gift card reselling game but only time will tell on that. Let me explain why.
Update 9/15/20: Today will be the final day you can list the old iTunes cards on Raise. So if you sell cards there be sure to load up your inventory today. I am not sure if other marketplaces will follow suit or not but Raise is as big as it gets so I would load them up to be safe.
RELATED: Apple Faces Over $1B Lawsuit Over iTunes Gift Card Scams
iTunes Gift Card Reselling Will Likely Be A Thing Of The Past
iTunes gift cards have been a mecca of points earning for gift card resellers for years. The gift cards often go on sale for 15%-20% off. Many people were able to buy them, rack up hundreds of thousands of points and then sell them at cost or for a small profit. iTunes gift cards have been a workhorse or backbone of many resellers and buyers.
With this change I doubt we will see many, if any, lucrative sales. I can’t remember one time that Apple Store gift cards where on sale. And why would they? This would only lessen the value of their Apple products. It would be a way to get an instant discount on all things Apple, which is something they have avoided as much as possible. I think that is a major reason why they kept the two gift cards separate all these years.
The silver lining is that if you are a reseller sitting on a gluttony of gift cards, they are now likely worth more. Whether you decide to cash them in on Apple products to resell, or sell the gift cards outright, they will likely have increased value.
Will This Change Reverberate Elsewhere?
This change looks like a short term win for anyone holding iTunes gift cards but a long term loss for resellers. But will this impact anything else? Does this change take a hit to the Best Buy gift card reselling game, in the short term? It is an area that has been on fire the last year or so, mainly because of buying clubs. And a big driver of buying clubs are Apple products purchased from Best Buy. This is turn drives the higher rates for Best Buy gift card resellers.
If there is a massive amount of iTunes gift cards on the market, that can now buy those same products at a steeper discount, will that drive down the price of Best Buy? What about Amazon, will it do anything to that market as well for the same reasons?
Let’s say Apple ends up offering a smaller discount on the new gift cards from time to time, will that make Best Buy less valuable as well? Only time will tell.
This game is an ever moving target, and sometimes changes that seem good on the surface can have a negative effect long term.
This change is a win for anyone sitting on a pile of iTunes gift cards, since they are now more valuable. I expect resell prices to go up until the market is depleted or for people to cash them out on watches, phones and tablets.
In the long term this is a loss for the gift card reselling community. iTunes gift cards were a stable workhorse for buyers and sellers. Do we lose some buyers because their business will be much less lucrative in the future? Are we able to earn as many points without multiple iTunes gift card sales each year? Does this end up negatively effecting other gift card reselling markets in the meantime? Only time will tell but I am not liking what I see in my crystal ball.
Share your thoughts below, how do you think this change will effect the gift card reselling game?
HT: Macrumors via Running with Miles
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Between Costco and Apple, I usually load up on iTunes cards a few times a year in the range of 10% – 20% off. This is often for personal use (or gifts) as I don’t do reselling. It’s been nice to discount all my app/iTunes/iCloud costs throughout the year. My guess is that these discounts will now go away. This ultimately means I personally will spend less with Apple though. Without those discounts I’m less likely to buy full price apps, for similarly priced movies Amazon will be 5% off with the co-branded CC, and got iCloud I’ll likely just suck it up (since multiple Apple devices back up there).
My Apple Hardware buying strategy has always been to use the co-branded Barclays CC during their ‘no-interest for X # months’ promotions. This with the cards reward system usually kicks back a couple Apple Store cards (you can also change over to iTunes Store cards as the redemption if preferred), but I think the points rate is more or less on par with the Apple CC cash back rate.
I do wonder how many people will adjust their app/movie purchases and rentals away from Apple since that discount isn’t baked in any more. It will be easier to find discounted Amazon gift cards then Apple gift cards.
While I would normally buy discount gift cards, recently I’ve added funds to my iTunes account in app to use the AMEX Platinum streaming credit. Apple gave me a small bonus. Speculating here, but maybe they do that in the future when they want to do a sale on digital, stopping resellers and targeting individuals by tying it to an Apple ID, and still distinguishing between digital and hardware. Anyway, I share your long term concerns.
Great point bb312 – I could see that being a way for them to offer a discount for the iTunes platform in the future.