It seems more likely that cash became unpopular independently. And for good reason! Trading cash during holidays really ruins the fun!
Perhaps the retail industry was just responding to demand - the market may just want gift cards!
>As for gift cards — well, let’s just say there is good reason that they are known within the retail industry as a stored-value product: they store their value very well, and often permanently. The financial-services research firm TowerGroup estimates that of the $80 billion spent on gift cards in 2006, roughly $8 billion will never be redeemed — “a bigger impact on consumers,” Tower notes, “than the combined total of both debit- and credit-card fraud.” A survey by Marketing Workshop Inc. found that only 30 percent of recipients use a gift card within a month of receiving it, while Consumer Reports estimates that 19 percent of the people who received a gift card in 2005 never used it.
Yes, 10% sounds about right for un-redeemed gift cards. But tell me, how often do you wear your xmas sweater? Have you ever gotten a gadget from a well-meaning uncle that just seemed stupidly dangerous and worthless?
Gift cards aren't inherently a bad gift. Bad gifts are. If someone gives me a Victoria's Secret GC and I am not in the kind of relationship where I would buy my SO lingerie, then it is not going to get redeemed (and I will forget about it by the time I would have an opportunity to). Whereas, if someone got me a GC for Amazon Kindle or Steam I would use that pretty gosh darned fast.
And obviously a store is going to push the GC. Even if it is a 20 buck card and you buy something for 19.99 they turn a profit. And more likely you'll spend 25 or 30