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Weekly Furniture World Media Note #33 from Lance Hanish - MobileFirst: Now Brands Only Have To Pay After The Sale Is Made

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Instead of adding another “happy birthday!” comment to your friends’ Facebook walls, a startup called Wrapp would like to have you post a free gift certificate for stores such as Gap, Sephora or H&M — as long as your friend meets the brand’s target demographic.

Sarah Kessler in mashable.com writes “after a successful pilot in Sweden, the start up company, Wrapp, is launching with 10 brands in the U.S. on this week”. But what is so different about this than what brands already do? “Brands offer gift certificates through Wrapp to gain exposure online. They already spend money on special offers and discounts. By using Wrapp, brands can have their target consumers’ Facebook friends distribute offers for free, rather than paying for Facebook ads or online banners. Meanwhile, the coupons encourage recipients to travel to brick-and-mortar stores, where they will almost certainly spend more than their coupon value. Brands only pay Wrapp when a customer redeems a gift certificate.”

Pay-as-you-go. Brilliant idea. Here is a company that so believes in what they are doing that they are willing to put up their talent and social media knowledge and put it where their mouth is. They will deliver the sale or they won’t be paid. This is made for the home furnishings business.

From a consumer perspective, Kessler states that there are a couple of interesting points to consider. First: certain free gift certificates are only available for certain friends depending on whether their demographics and location are favorable to the advertiser. Second: free coupons are usually about the value of a discount. We’re not talking substantial free gifts here; if you want one of those, you’ll have to shell out extra money. Wrapp collects a commission for paid gift certificates.

To make it even better, the redemption process is fairly easy. “As soon as a gift certificate hits a Facebook wall, it becomes a group gift to which anybody can be added. The recipient can use Wrapp’s Android or iPhone app to show a bar code at the store in order to redeem it. In Sweden, 165,000 people have given Facebook friends 1.4 million gift cards since Wrapp went live in November.

Brands want to get onto Facebook walls in a social context. That’s what Sponsored Stores are about. But this is a much more natural way for consumers to include them.”

The idea of paying for something once the sale is made rather than paying up front for a hope and a prayer, seems like a superb concept for today’s business model.

We live in a new DNAge.

Think MOBILEFirst.

Lance Hanish is Chairman/CEO and Chief of Imagination at Sophis1234 Data.Digital.Direct. He can be reached at Lance@Sophis1234.com; Facebook: http://on.fb.me/w88x5m Twitter: @Sophis1234; Pinterest: http://pinterest.com/sophis1234/  

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