Jan 15, 2013

Social Gifting Bridges Gap Between Affiliate Marketing and Social Media

Are you on Facebook? Do you like getting gifts? If you answered yes to both of these questions then get ready for the next evolution of affiliate e-commerce: social gifting. 

From a consumer standpoint, the idea is simple. Buy a gift card, send it to a friend and make their day, birthday, anniversary or whatever holiday/event Facebook has repeatedly reminded you about regarding that person. The lucky friend will then receive the voucher for redemption and so goes the cycle on consumerism. Facebook created a social gifting business model, appropriately named Facebook Gifts, after acquiring a startup called Karma in 2012 and has since redrawn the concept of a digital wallet by combining the concepts of Google Wallet/Apple Passbook with Groupon and a touch of Hallmark.

There are several start-ups that are taking this concept and running with it before Facebook really decides to go at it full speed. Chicago based Boomerang is adding a twist by actually rewarding you for giving. The idea is similar in that it lets you gift tangible items through Facebook, but Boomerang’s platform uses location data and demographic statistics from your Facebook friends to recommend more personalized gifts like dinners or local business deals. Participants can also receive small dollar gift cards with frequent gift card sending.

Taking a lesson from Groupon, Boomerang does not drive retail partnerships by offering steep discounts but rather puts its effort into concentrating on the $100 billion Americans spend on gift cards annually. This has enticed a flood to top tier partnerships, undoubtedly with more on the way.

Boomerang adds a bit of a personal touch in that they'll not only post the gift on their site – they'll make a custom holiday message / card for the brand. The brand can share this with their subscribers, which gives them to Boomerang promo code. As each recipient receives their "gift", Boomerang incentivizes them to pass the promotion on to friends by giving them free gifts.  (i.e – send X Merchant’s gift to 5 friends, receive a free $5 Starbucks card).

One of Boomerangs’ largest competitors, Wrapp saw explosive growth over the 2012 holiday season boasts an average of 1 million weekly gift cards sent with approximately a 100k redemption rate every week.

Both Wrapp and Boomerang offer a variety of free small dollar gift cards that an end user can give away, which makes vendors even more elated because it drives interaction and consumer retention at a much smaller cost in comparison to the big daily deals sites.

Social gifting bridges the gap of the growing digital practice in affiliate marketing with the non-stop growth of social media channels. Overall, affiliate marketing is in effect one of the best and most efficient digital tools for market saturation and brand awareness. Now that affiliate marketing has a personal touch while still being able to promote a hyper local small business initiative, 2013 will undoubtedly be the beginning of a new era in ecommerce development by allowing any size business to take advantage of a part of the digital marketing industry that traditionally required larger budgets to break into.


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