The 'indulgence' of gift cards

from a UW news release

Shoppers will likely spend extra when they receive gift cards electronically loaded with funds, says a study by a UW researcher. Rebecca White, a postdoctoral fellow in the psychology department, specializes in studying consumer decision-making and financial judgment. Her study on gift card spending has been presented to the Society for Judgment and Decision Making.

"I examined how people use gift cards compared with equivalent cash gifts," White says. "Presenting a gift card can lead a person to spend and think about these funds quite differently than if the gift were given as cash." Her research shows that receiving money on a card seems to make people likely to spend more of their own money beyond the amount they were given.

"Gift cards are claiming an ever-increasing role in consumers' gift purchases," White said. "Therefore, there are both theoretical and practical reasons to investigate how gift cards may influence consumer behaviour."

Her recent research, based on experiments conducted while she was a graduate student at the Ohio State University, indicates that when people receive gift cards, they are likely to spend significantly more money, above and beyond the amount of funds on the card, than those who receive the same amount as a cash gift. Even when participants were asked to imagine using a gift card that returned unspent money in cash, they still reported a desire to spend more money than those who were asked to think about using a cash gift.

"Gift card recipients may not view them as having 'real' monetary value — instead gift cards may be viewed as a symbolic object," White said. "When I asked participants to describe the use of a gift card on a DVD box set, they were much more likely to report that this gift purchase felt like 'receiving a free DVD set as a gift,' rather than any possible monetary interpretation, such as saving $50 on a DVD set or spending $50 on a DVD set."

While people who receive gift cards are likely to use them for indulgent purchases, those who receive cash gifts are more likely to use them on practical purchases, she says. "When we receive a cash gift, we may also feel greater social obligation to put the funds to practical use, rather than using them to indulge. Gift cards seem to offer a person the license to treat themselves."

Gift cards are rated more positively and their use as more memorable, compared with cash. Cash gifts are an unpopular form of giving for two main reasons, White says, pointing to previously published research. "There's an apparent lack of time and effort taken by the gift giver, as well as the unintended use of gift money for practical rather than pleasurable uses." White found that even when people received more money in the form of a cash gift versus less money on a gift card, they seemed to derive more enjoyment from the cards.

The results of the research hold implications for people's gift-purchasing decisions, White said. Gift cards may be more positively viewed and more memorably used on indulgent purchases than cash. She warns that if the intention in presenting a monetary gift to a friend or relative is to offer a bit of financial assistance, a gift card may paradoxically cause the recipient to actually end up spending more money instead of saving.

White is currently working with Derek Koehler, a UW professor of cognitive psychology, on a series of research projects related to people's self-predictions about their financial decision-making.

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Renison contractor also a donor

Bernard Melloul, the president of local construction firm Melloul-Blamey, is acknowledged as "a generous supporter" of Renison College in a feature that appears in UW's 2005-06 donor report. Here's some of how the college describes the man and his work:

"Airy open spaces and a wash of cool colours combine with glass, steel, and granite to create an inviting, contemporary office space that is distinctive of a Melloul-Blamey construction project. The company’s new home is impressive.

"A graduate of the Conestoga College construction technology program, Melloul began his career with Monteith-McGrath, a Kitchener-Waterloo area construction company. Melloul regards his mentor, Neville Monteith, as one of his greatest influences and credits his early working experience with providing the training ground and confidence required to start his own company.

"In 1982, with fellow Conestoga grad David Blamey, he founded Melloul-Blamey Construction. Since that time, Melloul-Blamey has distinguished itself through a wide range of projects that include residential, industrial, heritage, and commercial development. The Academic Centre at Renison College is one such project. In this new facility, a striking atrium entrance, a large state-of-the-art library, and a language lab combine with an East Asian Resource Centre and multiple student study spaces to create a vibrant 21st century learning environment.

"In addition to his involvement in the college’s capital projects, Melloul has long been a generous supporter of Renison. With a business culture based on family, and a philosophy that places his company’s strengths in its people, Melloul sees the same values mirrored in Renison College. 'Waterloo is our town,' he says."

He's pictured meeting with Joan McKinnon, chair of the local division for Renison's capital campaign.

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Plus: January brings new students

While the majority of new students come to UW in September each year — more than 5,000 are expected at Labour Day 2007 — there are also a special few who, for academic or personal reasons, start in January instead. "We will be welcoming 91 new first year students in January 2007," says associate registrar Nancy Weiner, breaking the numbers down: 43 in arts, 46 in mathematics and 2 in environmental studies. The newcomers won't get the extensive orientation program that's offered to September arrivals, but they are being invited to a welcome reception on Wednesday, January 3, in the multipurpose room of the Student Life Centre.

Bleak news for the over-thirties, from Bob Hicks of IST: "Students of all ages will tell you that they use email for communicating with old people. They say that email is for people stuck in the nineties." That'll get your attention, and maybe bring you in to this Friday's professional development session (9 a.m. in the IST seminar room). Hicks writes: "Want to find out what your kids are up to? Check out MySpace. Don't know what that is? Come to this seminar. Then, when you go home on Friday night, tell your son or daughter that you visited their MySpace. You will be sure to get a reaction from your son or daughter — either being impressed with your new knowledge or very nervous. Universities are just starting to investigate the technologies that students use for communication. In this seminar you will have the opportunity to learn about text messaging, social networking and blogging. Should be fun!" Speakers on Friday are Marguerite Doyon, Carrie Hartung and Kaitlin Holman, all co-op students who have been working in IST this term. Incidentally, CNN had a report on the same topic just this week.

The registrar's office in Needles Hall will be closed all day tomorrow "to facilitate some organizational changes within the office". • The finance office lists Friday as the deadline for payment requests, travel claims and similar submissions to be processed before the Christmas holiday. • Today's the final day of a "holiday book sale" that the UW bookstore has been conducting in the South Campus Hall concourse.

A Christmas luncheon ($16.50 plus tax) is available this week at the Festival Room in South Campus Hall (reservations ext.8-4700). • And Christmas dinner is what's on the menu today at Mudie's cafeteria in Village I. • The staff association says its members can avail themselves of discount tickets to Chicopee Ski Club again this winter (call ext. 3–3566).

Finally, a couple of corrections. One: I wrote on Tuesday that Warrior lineman Chris Best, who will play in the East-West Shrine Game in January, is "the first UW player ever to make it to the American college all-star fixture". Not quite accurate: he's the first Warrior to be invited to the Shrine Game, but there were Warrior football stars of olden days who did appear in other U.S. all-star games, and their lustre shouldn't be forgotten. Two: I managed to write yesterday that the application deadline for admission to UW next September, for students not coming from Ontario high schools, had been October 31. In fact, applications from that group are still being accepted, and will be received all the way to March 30. There are various exceptions; the fine print is on the admissions web site.

CAR

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