Best Buy: $50 SIRIUS Gift Card For $55. What?

Best Buy is selling a $50 SIRIUS gift card for $55. Rather, that is the “national internet price” at BestBuy.com—Best Buy stores may sell the $50 gift cards for $50. Any idea what is going on here? We chatted with a surly Best Buy representative who offered one explanation.

According to the saleswoman, SIRIUS charges Best Buy $55 for the $50 gift card. This could be a clever SIRIUS ploy to drive customers to their own website while subjecting Best Buy to ridicule. Can anyone offer a better explanation?

SIRIUS – $50 Gift Card for SIRIUS Satellite Radio [BestBuy.com]
SIRIUS $50 Pre-Paid Subscription Card [SIRIUS]

Comments

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  1. trollkiller says:

    Makes you wonder how many idiots bought one.

  2. Myotheralt says:

    But if you return it, it would cost $65.

  3. VicMatson says:

    If you look they are out of stock at SIRIUS so I’ll bet the minions at BB bought them all on the side because they have been blacklisted.

    Or not!

  4. ageshin says:

    Well lets see. A fifty dollar gift card gets you fifty dollars of goods or service. A fifty dollar gift card that you pay fifty five dollars for still will get you fifty dollars of service. Why would anyone buy such a card? It all smacks of illegalety, dishonesty, greed, an all the other words of like ilk If an espesialy dumb person or store chain wanted to rip off its patrons this is what they would do. Say, you got two twenties for a ten?

  5. DanKelley98 says:

    I’ll be thats the price off the secret “in-store” website…

  6. catnapped says:

    Maybe it’s a collector’s item?

  7. karmaghost says:

    Here’s how I see it:

    You go to store X and buy a gift card for store X. There’s no overage or fee because you’re eventually going to use that money you spent back at store X.

    You go to store X and buy a gift card for store/service Y. There IS an overage or fee because X needs to profit somehow from the sale of gift card for store Y because that money you spent isn’t going back into store X.

    The second situation is what I’m seeing here; Best Buy is selling something people can use on Sirius, but they have to make a profit somehow so they overcharge you $55. That sucks, but the solution is to go somewhere else or wait until they’re back in stock at Sirus.com or whatever.

  8. homerjay says:

    Yeah, thats right. Sirius charges $55 for a product that BB will sell for $55. Makes perfect business sense to me!

  9. flamincheney says:

    I wonder what they charged for shipping????

  10. dzap says:

    I’m going to guess that they some how got it mixed up with the XM Version of the Gift Card maybe? I’ve seen some silly mistakes on Bestbuy.com in the past..
    [www.bestbuy.com]

  11. fredmertz says:

    I wonder if it is just a mistake.

  12. bsankr says:

    SIRIUSLY?

  13. DeleteThisAccount says:

    Wait a minute…. people still shop at anything BestBuy? Idiots.

  14. XTC46 says:

    @karmaghost: actually, gift cards are cheaper than their face value. For instance, at CompUSA we can buy $15 iTunes gift cards for $14.10. It is cool, becasue we also get discounts on things like xbox live subscriptions, WoW and EQ subscription cards, etc.

    This is probably just a mistake.

  15. toddiot says:

    @bsankr: Nicely done :D

  16. clocker says:

    The extra $5 obviously pays for the pleasure of dealing with BB.
    Seems like a bargain.

  17. Mr_Human says:

    M@AngrySicilian: Man, if I didn’t shop at every store that someone said only idiots would shop — well, I wouldn’t be shopping _anywhere_.

  18. Shadowfire says:

    @karmaghost: Naw… most stores sell gift cards with no “increase to make a buck.” Our store sells gift cards all over, like iTunes, Chili’s, Home Despot, and other places, and we sell them at face value. The store gets a cut of the card’s cost, but it comes out of the base $25/50/whatever.

  19. RogueSophist says:

    @fredmertz: Now that’s the sort of well-reasoned suggestion that’ll get you banned around these parts. Mistakes are hardly sensational, Fred! Wink.

  20. edrebber says:

    Best Buy wants us to believe that they are selling a $50 gift card for $55 and Best Buy isn’t even making money on the deal? Riiiiiiiiiiiiight.

  21. SeraSera says:

    Well, if you need a Sirius gift card, you could find the price anywhere else, bring it in, and Best Buy will give you that “price-match-plus-10%-of-the-difference” thing, right? Or is that another electronics store?

  22. bertram says:

    notice it is on back order.

  23. STrRedWolf says:

    Worse. I picked up a pair of American Express gift cards. Gave one to bro-in-law, and had to use the other one for the neices and nephew’s gifts.

    But buying them, it was $25 plus a $4 handling charge at the register. The card’s cover and the receipt say all of this.

  24. blitzcat says:

    Sirius sucks too, that $50 won’t all go to programming. They will eat 30% of it with an activation charge, then tax you too. My sister got it for xmas (shes blind so this was a pretty cool gift) and I had to bite my tongue while activating it.

    STOP THE MERGER!

  25. ptkdude says:

    @blitzcat: XM’s activation fee is $15, Sirius’ is $10 if you activate on the web and $15 by phone. In my state, Sirius either doesn’t charge tax or it is already built into the price. I’ve had Sirius since 2003, and aside from the fact that they fuck up my rebilling EVERY year, I’ve loved the service. I do end up getting a $30 credit every year because of the rebilling issues, though, so I’m not complaining!

  26. Nighthawke says:

    Someone needs to poke Siruis and inform them of this screwup by bestbuy.

  27. martyf says:

    Here’s what I think.
    I think that the face value of the card – $50 – is what you get after a mandatory “activation fee” (don’t get me started) is paid. Some (most?) cards bury the activation fee in the use of the card, but I suspect that soon a $50 card will cost $55 because various local laws will crop up to require a card marked $50 to, you know, be worth $50 when you first use it.

  28. Buran says:

    @DanKelley98: Beaten to it!

  29. Buran says:

    @Nighthawke: They’ll probably tell you that, like just about all other goods, the retailer sets the price.

  30. MrsMicah says:

    @Mr_Human: I hear ya.

  31. mammalpants says:

    paying for radio. haaaa haaa!

  32. ptkdude says:

    @mammalpants: You pay for “free” over-the-air radio, too. You pay in time, listening to commercials.

  33. SaveMeJeebus says:

    Someone please explain to me how I still get Sirius for free? I shut service off years ago and have a first-generation clunky antenna/receiver setup in my car. I called them to tell them that my service was not off and they just said that I am not a customer.

  34. calvinneal says:

    There is no sales tax on Sirius subscriptions except in states where they have a brick and mortar presence.That would be new York. Retailers don’t set higher prices for gift cards. That is absurd.Cards like American Express and Visa have a fee when you buy them.They are essentially pre-loaded credit cards which can be used anywhere.

  35. Mr.Purple says:

    @SaveMeJeebus: Same!
    It is actually kind of awesome though. I get full programming for free.

  36. madog says:

    At the little Mac store I work at we don’t sell iTunes gift cards because we can’t get them at a discounted cost, so we would end up having to charge the customer more for the card such as BB is doing here. But that’s exactly why we DON’T sell them at our store. You can pretty much get those things at any 7/11, grocery store or Barnes and Noble anyway.

  37. DeleteThisAccount says:

    @Mr_Human: Granted… but come on, BestBuy? People who shop there _deserve_ to shop there, if you know what I mean.

  38. coren says:

    @karmaghost: I can go to Safeway (substitute with Kroger, Giant Eagle, or some other grocery chain) and buy 10, 20, 25, and 50 dollar gift cards to about 50 different stores (including safeway).

    They all cost the value of the card, nothing more.

  39. karmaghost says:

    @coren (and others): I’ve seen many gift cards that you buy for face value at one store that are for use at another. However, I don’t think it’s unreasonable to expect that the store that sells the gift card to you is profiting from the transaction in some way. They’re not providing you the no-fee $50 card to Red Lobster because they’re nice people. I think that in the case of the Best Buy/Sirius card, while it is possible that it’s a mistake, I’m thinking that the profit element of the whole deal is just more transparent than with other gift cards.

  40. wellfleet says:

    Ummm… really? Did nobody stop to think that it’s a TYPO?! I work at BB and find errors on the Web site every day. There are millions of items and mistakes happen. The $30 Sirius card is $30, same for the $49.99
    I realize that there are lots of angry former customers out there, but be honest with yourselves.

  41. speedwell (propagandist and secular snarkist) says:

    C’mon, you guys are smarter than this. A 50-dollar gift card does not cost the retailer 50 dollars at any point. Quick and dirty illustration:

    Maybe their estimated cost is fifteen dollars of merchandise and ten dollars of overhead (including the costs of dealing with the card), say 25 dollars total. They sell the card to a reseller at a price point of, for example, 40 dollars. Immediate profit. Then the reseller sells the card for 50 dollars. 10 more dollars profit go to the reseller. Then the card recipient goes to the retailer and buys the 15 WHOLESALE dollars worth of merchandise for 50 RETAIL dollars.

    Bottom line, Best Buy didn’t pay 55 dollars for the Sirius card, or even 50 dollars. It doesn’t work like that.

  42. yg17 says:

    @blitzcat: Big deal….the activation fee is only 10 bucks last time I checked. And it’s very much worth it. And I don’t pay any taxes. Each month, my Visa is charged for $12.95, the cost of monthly service. After having it for a few years, I wouldn’t own a car without Sirius. Even though my new car has a 6 disc MP3 CD changer and iPod adapter (meaning it can hold a fuckton of my music) I still listen to Sirius because the selection just can’t be beat.

  43. EvilSquirrel says:

    I just clicked the link and it claims the card is backordered. Maybe there are enough idiots out there looking to pay too much for this gift card. Someone should also check this on the website in the store. It might be $65 there.

  44. chrishop says:

    @xtc46:
    And that is why Compusa is going out of business. Great business model there.

  45. parad0x360 says:

    Some random best buy person would not know how much sirius charges best buy for the cards.

    Actually im pretty sure it works the other way. Cards are free for the store, most often the company pays the store a small fee to sell them. When they are rung up they connect to a server seperate from the store that is run by another company (like Sirius) which then credits best buy for the sale and ads value to the card.

  46. savdavid says:

    LOL! Some of the comments are great! I love reading what people have to say about these “businesses”.

  47. ptkdude says:

    @SaveMeJeebus: @Mr.Purple:

    Here’s how that happens: when you ask for your service to be turned off, they send a deactivation signal via the satellite to your radio to have it turn off all the channels (except the preview channel 184). If you turned off the power to your radio prior to this signal being sent, and you don’t turn it back on for some time, it will never receive the disconnect signal and will continue to work, even though you are no longer in Sirius’ billing system. Eventually, Sirius’ system will assume the disconnect request has been successfully received and they will stop sending it. I have a radio in this state myself, and use it at work :-)

  48. fredmertz says:

    @speedwell: Retailers who sell other company’s gift cards make virtually nothing — maybe a couple of percent, which on a $50 card would be about a buck. The stores that do it, do it for convenience (i.e. mostly drugstores and supermarkets) and to drive traffic. Also, it is very rare that a retailer has a merchandise cost of $15 on $50. 70% gross margins are the exclusive territory of software companies, service companies and the occasional high-priced retailer that sells their own goods like Coach, for example.

  49. rmeehan17 says:

    …and if you bought the $50 gift card for $55, give me a call, I have some real estate i’d like to sell you.

  50. What The Geek says:

    I’m to lazy to read all the comments – maybe it’s been mentioned before, but wasn’t BB the one selling the Wii points cards valued at $20 for $25 last year?

  51. speedwell (propagandist and secular snarkist) says:

    @fredmertz: Yeah, the numbers themselves were pulled out of a hat, but the basic point is still that if the retailer did not profit when they sold the card to the reseller, and the reseller did not profit when they sold the card for its face value, we would not see resellers at all.

  52. Deusfaux says:

    Having worked at a BB, I can say they regularly charge more for gift cards than the face value. Whereas everybody else, would not.

  53. mgyqmb says:

    @karmaghost: Typically in a situation like this, Sirius would pay Best Buy for the opportunity to sell in their stores. BB shouldn’t have to charge anything additional in order to make money on the product sold. They are already making money by getting Sirius better exposure and driving their sales.

  54. Hawk07 says:

    @whatthegeek:

    I don’t know about Wii points, however, earlier this year before Halo 3 was released, their website had every 360 accessory a few dollars about their MSRP in an attempt to prey on the unknowing.

    I’m just glad I know the prices of what this stuff should cost so I won’t fall victim to their shenanigans.

  55. EvilSquirrel says:

    @mgyqmb: You also forgot that places like Best Buy are selling the hardware to listen to Sirius radio. I bet they make a few dollars installing them into your car too. Finally, they also get you into their store when you have to keep coming back to buy more cards. You might end up buying some of the music you heard on the radio in their cd section.

  56. Buran says:

    @wellfleet: Best buy, fix mistakes? Hahahaha. They can’t even fix things they promise state attorneys general that are no longer happening.

  57. coren says:

    @chrishop: I think, and I could be wrong, what they meant was that CompUSA itself buys those cards at a slight (6 percent?) discount, so there’s a 90 cent profit when the card is sold.

  58. coren says:

    @wellfleet: Best Buy doesn’t typo, they really were selling a Blu Ray Player for 18 bucks a couple weeks ago. They’re really nice like that.

  59. XTC46 says:

    @chrishop: Im an employee..our discount is we get stuff at cost, so it makes sense.

    They are going out of business becasue of horrible upper management with no focus on their core business, horrible technical services, and having too small of a market share to have competitive prices without rebates that often dont work.

  60. Tonguetied says:

    @Mr_Human:

    AMEN!

  61. ShadowArmor says:

    Costco sells a 2-pack of $50 McCormick and Schmick gift cards for $80. Now THAT is an awesome deal.

  62. blkhrt1 says:

    Go Sirius, trying to rip off the customer who’s going to get something that will change in February anyways. XM and Sirius is merging.

  63. Buran says:

    @blkhrt1: Did it actually get approval? Last I heard there was still debate.

  64. HOP says:

    BEST BUY SUCKETH……..AGAIN………….

  65. Chilijohn says:

    I would be more surprised by this if I didn’t remember that Best Buy used to sell the “1600 Microsoft Point Card” for the Xbox Live Marketplace for $5 above the exchange rate/regular price for most of a year, IIRC. $25 vs. $20.

  66. SinA says:

    Hoo hoo, we’re ripping you off!

  67. waitaminute says:

    Don’t forget that the Gift Card industry is a virtual Corporate ATM… unused gift cards mean HUGE profits for retailers (even secondary retailers… those who purchase brand cards at discount & sell them at face value)

    [www.allbusiness.com]

  68. DustoMan says:

    @Chilijohn: I was just about to post that. LOL!

  69. MarvinMar says:

    Right now at Kmart.com and in the store, you can buy a 2000 points Wii card, for the amazing low price of $24.99
    Yes, you can buy $20.00 for $24.95 What a frickin bargin!
    [www.kmart.com]

    Better deal is to go online on your WiiShop and buy your points there, Bonus is you can buy as little as $10 or as much as $50

  70. wellfleet says:

    @coren:
    About two months ago, Wal Mart had some insane deal on a Samsung Blu-Ray player, it was like, a penny or something ridiculous like that. BBY was sold out of this particular model and was no longer carrying it. So what did the company do? They sold the upgraded, brand new model for the same price at $200 below retail. Sometimes, they are nice like that.

    and @Buran… You’re going to have to be more specific. If you need help with a BBY issue, I’ll try and help you. That said, a lot of people spew information that is simply inaccurate.

  71. wellfleet says:

    I checked cost on those gift cards btw, the cost is $0.00 They are sold as a value-added to customers, as a convenience, and as an added reason to shop in the store. The money doesn’t go into BB. You think 7Eleven makes $50 off of XBOX Live cards? Please…

  72. agiganticpanda says:

    The gift-card price has changed. Probably more of an F-up than on purpose.