In today’s ever-digital world, even gift giving has gone the way of technology. And one savvy startup is capitalizing on the growth of the e-gifting industry with a revamped version of retail gifting that allows shoppers to “send” a present simply by inputting a recipient’s email address.
Brooklyn-based Smartgift has introduced a new concept of web gifting that gives consumers an alternative checkout option on a retailer’s website called, “Give as a Gift.” Here’s how it works: shoppers can peruse a website and choose an item to give to someone. When that customer goes to check out, the smart gifting features are launched, and they can then select the size and color of the product, or omit those details and let the recipient specify them later, pay for it, and designate an email address for the gift to be sent to.
Smartgift then delivers an email to the recipient alerting them that they have a gift. The email presents the giftee with a personalized card from the gifter and even offers a virtual unwrapping experience to maintain a sense of surprise. The recipient can then designate their preferred product details, or make changes to any the gift-giver selected for them–even pick an entirely new gift–enter their shipping address, and send an automated thank you to the sender. Orders and deliveries are processed via the retailer’s existing e-commerce software.
“Our technology completely changes the way retailers allow their customers to purchase gifts at their online stores. The Smartgift checkout process increases gifting revenue and decreases costs by solving the inefficiencies associated with online gifting including incomplete recipient information, abandoned shopping carts and returned gifts,” the company website notes.
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Shopping cart abandonment rates have long been a point of frustration for retailers and many work tirelessly on ways to cut down on discarded carts. Forrester Research has estimated that 87 percent of shoppers abandon their carts, which ultimately translates to $18 billion of lost revenue a year.
Smartgift tracked the behavior of consumers using its technology to make purchases and found that allowing customers to give a gift solely by entering an email address reduced shopping cart abandonment rates by 27 percent.
In terms of translating into increased sales, Smartgift also recommends options for recipients to exchange the gift for other products or opt for a bigger gift by paying the price difference, providing retailers an opportunity to up-sell and acquire new customers.
When given the choice, 14 percent of gift recipients opted for and were willing to pay the difference of a pricier present, according to Smartgift.
The technology can be seamlessly integrated to any retailer’s existing e-commerce platform and can be customized based on individual needs. Implementation takes about two weeks.
Smartgift’s website offers a “Calculate your ROI” tool where retailers can enter their annual revenue and monthly transactions, and find out what additional gifting revenue they could bring in by using Smartgift, plus the potential percentage increase of holiday gift sales and the calculated cost savings from fewer gift returns. The site also allows viewers to test the experience as either the gift giver or the recipient to see how it works.
Monika Kochhar and Bernd Strenitz, who co-founded Smartgift, created the newfangled gift-giving concept at a time when the e-gifting industry is flourishing as consumers increasingly seek the ease of buying and shipping gifts all at once. E-gifting sales have increased from $300 million in 2012 to $3 billion last year, and that number is expected to top $10 billion by 2016, according to researchers at CEB TowerGroup.