Keiretsu Forum London - WeGift

Summary

Erin Alexander, the founder and CEO, discusses the transformation of the gift card economy, highlighting its massive $307 billion market. She reveals how the industry remains dominated by archaic manual processes, with 95% of transactions still involving plastic cards. The company has streamlined this by connecting directly with data processors, enabling real-time code issuance via an API. With over 100 brands integrated, the platform offers new revenue opportunities and operational efficiencies for businesses. Alexander emphasizes the importance of expanding into Europe and enhancing product offerings to meet increasing demand, all while positioning the company for potential acquisition by major industry players.

Takeaways

• 🎁 The global gift card market is valued at $307 billion and is projected to grow significantly.
• 🏢 Half of the gift card market consists of B2B transactions, where corporations buy gift cards for various purposes.
• 📉 Despite its size, 95% of the market still relies on outdated plastic and paper gift cards.
• ⏳ The traditional process of buying gift cards is manual, time-consuming, and prone to errors, often taking up to seven days.
• 🔗 The company aims to streamline the gift card purchasing process by connecting directly with data processors, enabling real-time code generation.
• 📊 The platform allows buyers to instantly download gift card codes in real-time, improving operational efficiency.
• 🚀 With over 100 brands integrated into their system, the company has developed a strong portfolio in the gift card market.
• 💼 The company’s business model includes a range of products charged at a monthly fee, plus costs for each code issued.
• 🤝 Recent partnerships and contracts with major players indicate growing confidence and demand for their services.
• 🌍 The company is focusing on expanding into Europe and enhancing its product offerings to meet increasing market demand.

Q & A

What is the current value of the global gift card market?

$307 billion.

What is the projected value of the gift card market by 2024?

Around $400 billion.

What percentage of the gift card market consists of B2B transactions?

50% of the market.

What are some use cases for businesses purchasing gift cards?

Businesses use gift cards for employee rewards, customer incentives, and loyalty programs.

What are the main problems with the current gift card processing system?

The system is manual, time-consuming, error-prone, and involves multiple parties, leading to delays of up to seven days.

How has the company streamlined the gift card issuance process?

By integrating directly with data processors, allowing real-time issuance of gift card codes through an API.

What is the company's business model for charging clients?

The company charges between £500 and £3,000 per month for its B2B ordering products, plus a fee for each code.

What recent developments indicate the company’s growth in the market?

The company has raised funds, secured over 100 brand partnerships, and is in contract negotiations with significant players like SPM.

What is the company's focus for the next three to six months?

To finalize contracts in the UK and expand into the European market, particularly with international companies.

What issue related to gift cards has seen a significant decrease, and what is the current percentage?

The issue of breakage, which has decreased to about 3-4%.