Whether it's because of genuine affection or societal pressure, the holiday season compels you to find the perfect gifts for friends, family and more. It also means facing the inevitable — some people, even the ones you're close to, are just downright difficult to shop for.
A tried-and-true solution, of course, is purchasing gift cards. They allow recipients to choose their own gifts, which, in theory, cuts down on both unwanted presents and unnecessary purchases. But digital platform Gyft is taking the whole concept a step further, looking to change the way you think about gift cards by digitizing the plastic in your wallet.
See also: 7 Sites for Holiday Gift Inspiration
The secure platform, available online and as a free mobile app for iPhone and Android, allows you to manage all of your gift card needs. Connected to more than 200 big brands (such as Amazon, Target, Whole Foods and Banana Republic), you can buy gift cards, send them to others, and upload and store their information. You can redeem them straight from your device, so you no longer have to carry several cards in a fat wallet or worry about forgetting them at home.
And before you say, "But gifts cards are such a cop-out," consider this: Nearly 60% of holiday shoppers in 2012 said they would like to receive gift cards.
We spoke with Gyft co-founder and CEO Vinny Lingham about why he created Gyft, how it can benefit consumers and retailers alike, and what the company is doing to support a good cause this December.
Image: Vinny Lingham
Mashable:How did you come up with the idea for Gyft?
Lingham: Gyft was initially conceived when I first used the Starbucks app in late 2011. It was an awesome experience, being able to use a prepaid card and then swipe your mobile phone to pay. I wanted to offer this service for consumers and for all retailers. In January 2012, we officially started working on it.
What can first-time users expect from the platform?
We launched with just over 100 of the top brands about 15 months ago, and have now connected more than 200 retailers to our platform. These are retailers from which you can instantly buy a gift card and either use for yourself in their stores or give to a friend. We make purchasing easy by allowing you to pay using PayPal, credit card and Bitcoin, and we have a loyalty and rewards system called Gyft Points, which rewards users with up to 3% back for all their purchases with us. We also allow users to upload their existing plastic gift cards to Gyft, check their balances and regift them, too. My favorite feature is the video message that you can attach to a gift card!
The points system is a fun component. How exactly does that system work, and what was the idea behind including it?
We have big plans for Gyft Points, but for now, we give users a reward for buying gift cards: 1% back for using a credit card, 2% for PayPal and 3% for Bitcoin. It's a proprietary loyalty program that is funded entirely by Gyft. We are going to be introducing the ability to earn points for a number of other actions, too, such as referring friends.
How long has Gyft accepted Bitcoin, and why do users receive triple the points for paying with it?
Gyft was the first gift card company to accept Bitcoin, back in May of this year. We decided on triple points because we believe that one of the real value propositions of Bitcoin is to reduce the cost of transactions that retailers have to pay for. We wanted to pass this saving straight back to our customers.
Since the concept revolves around selling other companies' gift cards, how does Gyft make a profit?
Gyft buys gift cards at a discount from retailers, and then we sell them at face value. The margins are thin, so it's definitely about volume.
How do retailers benefit from using Gyft?
Gyft helps retailers in a number of ways. Firstly, we take care of payment and related costs, including fraud and chargebacks, which can be up to 4% for most retailers. We also bring new customers into the fold [by] enabling [them] to send gifts to family and friends to their favorite stores. Lastly, we help consumers manage all their plastic gift cards, too — which ensures that they don't lose them — and continue to engage with the retailer.
Most of the time, unspent gift card dollars [of which there was $1.8 billion in 2012] sit on the retailer's books as a liability. We help drive gift card usage and reduce this liability, and convert these dollars into sales. Typically, a consumer will spend three to five times the face value of a gift card.
How does Gyft compete with rival sites? Any particular strategy to stay ahead of the game?
We are the first mover and market leader in the mobile gift card space. We believe that staying ahead of the game is about knowing what your customers want and surprising the heck out of them — we do this all the time and are proud to say that our customer satisfaction levels are through the roof. As an example, when we launched Gyft Points, we gave all our customers backdated points. This was a huge surprise and a big hit with them.
In a recent survey, about six out of 10 users that signed up with Gyft were referred to us by a friend.
Gyft profits during the month of December will help support the fight to end HIV/AIDS. Can you talk about this initiative and its goals?
Image: Gyft
Gyft has teamed up with the Immunity Project — a group of scientists in San Francisco working on the world's first HIV vaccine who intend to give it away for free. We partnered with them to help drive awareness of their campaign and special cause, and help contribute to fighting HIV/AIDS.
I and some of the other Gyfters are also from South Africa, where one 1 in 5 people suffers from this disease, and so it's a cause near and dear to us. We're giving up to 100% of our profits in December to the Immunity Project from gift card sales — so we're hoping that more consumers start using mobile gift cards and help to save lives.
Have you or would you use Gyft? Tell us in the comments.
Image: iStock, SpiffyJ