Second, in instances where the amount is the same (as in your example), the choice of which to take is based upon where you’ll spend the money. If you’re going to spend money at … say Barnes and Nobles or Borders anyway, having a predefined card that is a concrete limit can help reduce frivolous spending. If you’re in a situation where you have X amount of money, and you haven’t alloted it to a particular venue, it is very easy to spend entirely too much. That is where it’s nice to have a vendor-specific gift card. If you only have a $25 or $50 gift card for Borders, you’ll will often spend less and won’t have to worry about whether or not you have the money – something that can happen a great deal if you don’t balance your checking account registry.

Ultimately, I think its the coupon argument. Take breakfast cereal for instance – lots of those little boxes are a bit too expensive their own good. Cheerios, for example, costs something like $4 for their bigger box. They often have $.50 coupons (or more, plus double coupon days, etc) but the net result is that you’re likely to pay, on average, the full $4 (maybe you forgot your coupon or maybe you got a different type than the coupon explicitly described, and so you can’t use it anyway). So you have a whole slew of cereals that are standing there offering the coupon discounts, hoping you’ll forget or be too lazy to find/have the coupon, and ultimately overcharging everyone.

So – perhaps the real answer is marketing … like how, with proper product placement and the resulting brand loyalty, a company can offer a $50 gift card knowing that the emotional importance, comfort, and convenience associated with the gift card will result in some large percentage of return.