American Express Membership Rewards - Why people buy gift cards?

I saw some posts on no fee gift card and i read people buying gift card all the time. Im sure I'm missing something here. You earn MR points when you buy the gift card like you buy anything, but what else?

What am i missing here?

In some cases it lets you transfer spending categories. For example, if you buy a restaurant gift card at a grocery store, you will often get the category bonus for grocery stores even though you're actually using it at a restaurant.

This can be especially appetizing for cards with big bonus categories like Discover and Chase Freedom.

Plus, it provides a way to bring forward spend in the event that you're close to a spending requirement but not quite there.

I try to put most of my spending on gift cards that I buy at grocery stores partly because of what rookiecz said, but also to get discounted gas. Around here (DFW) the Kroger and Tom Thumb (Safeway) stores give you two points per dollar on gift card purchases. So let's say I am going to spend $100 each this month at Amazon, eBay, Target, Home Depot and Marriott. I buy $100 gift cards for each for a total of $500 and get 6% cash back (AMex Blue Preferred) plus 1000 fuel points good for $1 off per gallon on 35 gallons (note is limited to one use so you'll have to bring two cars or several six gallon gas cans to take full advantage of this). So I get $30 cash back plus $35 savings on gas for a total return of 13%.

good for $1 off per gallon on 35 gallons (note is limited to one use so you'll have to bring two cars or several six gallon gas cans to take full advantage of this).

Or bring one pig of a Suburban urban assault vehicle (42gallon tank). That's what I do :p

I have a 3/4 ton Yukon XL and $170 fill ups are fun! Oh wait that's what I just tell myself...

If I am going to make a big purchase with a retailer that has gift cards for sale at Kroger, I buy the gift cards there and go to the retailer and use the gift cards.

This quarter Chase is offering 5% up to $1,500 charged at grocery stores and if I use my Hilton Am Ex at a grocery store I get 6 pts/$ instead of 3.

As one other person said, you also can get points to use for gas and with Kroger (and IIRC also Giant Eagle) you get bonus points on gift card purchases so you can save on gas. You can also link your card with a list of charities and the spending on your card helps the charity out, so I am helping my church out as well.