In an attempt to harness the backlash against daily deal sites like Groupon, new so-called “social gifting” companies are trying to garner fans with a different kind of mobile merchandising. Instead of giving yourself the gift of a deal, apps like Wrapp allow users to give e-gift cards to popular retailers.
Sending someone a virtual gift might bring to mind the kind of presents Facebook used to offer — hey, here’s a “drink” that is really just an icon on a screen! — but as Fortune points out, social gifting could take hold because what it offers actually has worth.
Even Groupon investor and startup sage Reid Hoffman suggests that Wrapp could prove more effective for retailers than daily deals. “It has a similar value proposition but appeals to consumers in a very different way,” says Hoffman, who invested in Wrapp’s $10.5 million Series A round in January and joined the company’s board of directors. “It’s not saying, ‘hey, my product is worth less than I charge for.’ It’s a different kind of marketing promotion.”
Wrapp (wrap plus app, ya see?), a Swedish startup, launched in the United States today, and it isn’t shy about touting how much it isn’t like Groupon. Users can send pals and loved ones digital gift cards for places like Gap, H&M or Sephora via Wrapp, and recipients can then use those gift credits at stores just by showing it on their phone at the store.
Instead of driving discount-hungry customers to stores they might not normally frequent, Wrapp aims to capitalize on consumers who maybe sort of could’ve possibly forgotten to buy a gift for someone’s birthday, and can make up for it when Wrapp reminds them of said occasion.
Meet the anti-Groupon [Fortune]