Start-Up Pairs Social Media and Free Gift Cards To Help Retailers Lure Shoppers

by Mercator Advisory Group 0

A Swedish company called Wrapp is helping 25 retailers lure shoppers into their stores by letting people give free gift cards to their Facebook friends and encouraging others to add value. The application is likely to drive new customers into stores because it gives them currency that can only be used in one place.

  • Using Facebook and a mobile application, people can give their Facebook friends free gift cards, commonly valued at $5 to $15.
  • A notification saying that they’ve received a gift card is posted to that friend’s wall, where anyone can see it and contribute more money if they wish.
  • The person, who received the gift card, can then redeem it using a mobile application in the store.

The part that is not clear is who gets the free gift cards in the first place. It seems that retailers will be able to use Facebook to find likely customers. The cards appear to only be redeemable via mobile app, which could limit their reach, depending on their phone compatibility.

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