No address required: Giftagram aims to streamline mobile gift-giving

Four Seasons Hotels and Jessica Alba are betting the new app can succeed where Facebook could not

Consumers are already doing more holiday shopping on their mobile devices this year than ever before, with $1.5 billion spent on Thanksgiving and Black Friday alone. But mobile gift purchases still lag far behind those made online or in store, largely because the tiny devices make it difficult to enter addresses and credit card information, say analysts.

Now, a new entrant to the market hopes to make it easier for consumers to make those mobile purchases — and to give brands a more direct line into customers’ pockets. Giftagram, which made its US debut Tuesday on iOS, is an app service that aims to bring gift-giving to the mobile space while streamlining the process. The app makes mobile gifting easier by allowing consumers to send gifts using only a recipient’s phone number or email address.

Upscale brands, such as Four Seasons Hotels and Jessica Alba’s The Honest Company, are jumping on board. "We’re a turnkey mobile distribution channel for them that’s putting their product or brand in the hands of a really relevant, often early adopter, tech-savvy, forward-looking user group and consumer," said Giftagram CEO and co-founder Jason Reid.

Of course, this isn’t the first time a company has tried to offer this service in this space. In 2012, Facebook acquired the gift-giving platform startup Karma and renamed it Facebook Gifts. Users could choose from a selection of a few dozen presents at several price points ("Under $10," "Under $50," etc.); pay with an account tied to their Facebook account; and have the gift mailed to one of their Facebook friends. The service never received much fanfare from Facebook, and the next year the company quietly shifted it to a gift card-only service before shuttering it altogether in 2014. Around the same time, Giftagram was beginning to build its partner network in Canada. Reid thinks they can avoid the same fate.

"While Facebook had obviously a huge headstart with having such a massive userbase to plug it into, I don’t feel they were able to deliver the experience in as effective a way as Giftagram does, which is mobile first, mobile only," Reid said. "That’s not Facebook’s DNA."

The options on Facebook Gifts also tended toward kitschy and cute — and inexpensive. That meant lower margins and higher volume requirements. (Facebook declined to comment for this story.) Giftagram is instead taking a boutique approach, hiring dedicated buyers to choose specific products from select brands.

It was that careful curation that initially interested Mike Macadaan, CEO and creative director at This is Ground, an L.A.-based shop that makes high-end leather accessories for tech products and partnered with Giftagram several weeks ago. "For me it was like, ‘Well, who am I going to be next to?’ So when I saw some of the other brands that were in there, I wanted to be in there," he said. "Whoever’s doing the buying for Giftagram has really good taste."

Nearly 1,000 items from more than 100 brands are available through the app, which offers a selection of each shop’s catalog. Customers browse on their phones or tablets (an Android version will be available early next year), select an item and enter a phone number or email address for the intended recipient. Giftagram then sends that person a message informing them they’ve received a gift and asking for a mailing address to ship it to.

"We were really attracted to getting in front of the types of people that would use Giftagram. They’re kind of in the sweet spot of our target audience," Macadaan said. "It’s about introducing our brand to people that are interested in mobile and efficiency, and they’re probably busy professionals who are attracted to the ease of use of a service like Giftagram."

And providing customers who fit that profile is one of Giftagram’s main selling points, particularly with brands that are looking to expand their mobile footprint. "We’re building Giftagram as the brand synonymous with sending thoughtful gifts to people, with a real, conscious focus around best-in-class products and services," Reid said. "It’s a young, professional, successful type of persona that doesn’t have time to go to the mall or do the bargain shopping that uses Giftagram because of the convenience factor."

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