The (QUICK) Rise of Social Gifting in France

Apr 17, 2012
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A while back I spoke about the rise of social shopping in France – three french companies with relative amounts of funding are all working on making the smartphone a perfect companion to shopping: grocery lists, coupons and reminders all on the phone. The subject interested me, because I still write down my grocery lists in Notes (although i’ve recently changed to Evernote, which isn’t any better for a grocery list), and I’d love to have my phone helping me out in the supermarket.

In the past few months weeks days, it seems that Social Gifting has gone from non-existent to having two competitors going full speed to win over the French market (among others).

What is Social Gifting???

Before I get into Wrapp and DropGifts, who they are, why cloning sucks, etc. – I thought it’d be good to answer the question on everyone’s mind “What is Social Gifting?” From as much as the startups’ sites will tell me, essentially “Social Gifting” has come to mean “giving someone a gift in a social atmosphere.” Through Wrapp, for example, I am notified of my (facebook) friends’ birthdays, and I can offer them paid or free giftcards (“Wait, Free Gift Cards?”) as a gift. In addition, I believe, my friends can piggyback on top of my giftcard gift by adding in extra money.

This is the idea that Wrapp launched with last September in Sweden – you can see one of their first articles Venturebeat. Like most companies, they started in their home country, and were planning on scaling up to neighboring countries, probably grab a series A, and then take Europe – and by then, an American competitor (note: not clone, because Americans NEVER clone) would pop up and buy them out.

Enter the Samwer Brothers

While the Samwer brothers have gotten famous on their cloning sweatshop Rocket Internet – their portfolio of companies boasts clones of Groupon (since bought by Groupon), PayPal, Zynga, JoliBox, Airbnb, and eHarmony – I’ll let you match up which companies are clones of which. The things these cloned companies all have in common (other than that they are primarily American), is that they are already proven businesses in the growth stage at the time of cloning. You can imagine why CEO of Wrapp Hjalmar Winbladh was a little shocked (and validated, I imagine) when he found out the the Samwer’s latest creation, DropGifts, was a clone their six-month old company.

With a Samwer creation on their tale, Wrapp has doubled down: they’ve since launched in the UK, and Norway, and are gearing up to launch in the US, Germany, Denmark, Finaland   , Taiwan – oh and of course, France.Wrapp currently boasts 140,000 monthly users of their Facebook App, and claims to have 165,000 active users in total. They have so far helped friends give 1.4M gift cards, which can be redeemed in fifty major retailers across Europe.

Wrapp is a proven, customer acquisition and retention platform for conducting discount-free performance-based campaigns.  With Wrapp, retailers use friend-to-friend marketing to drive highly targeted in-store and on-line sales, and get real-time access to aggregated campaign and customer demographic data.

Even with their quick action, extra $5 Million in fund-raising since DropGifts launched, rapid expansion & adjustment to their roadmap, Wrapp is going to have a tough time keeping up with a Samwer creation.With operations already in 28 countries, DropGifts is being fed the rapid expansion strategy that the Samwers have honed on in the past 10 years. Having already launched in France, they’ve already been featured in LeMonde, TF1, FrenchWeb, and TCFR. With Wrapp still securing key partners before their launch, it’s going to be an uphill battle, in the French market at least.

Entrepreneurs love to root for the underdog, which is usually the inventor – although, in this case, it is not as if Wrapp ‘invented’ social gifting. It has existed for sometime; Silicon Valely startup Karma has been helping people exchange giftcards via mobile since 2011, for example. Nevertheless, it is clear that Dropgifts is gunning for Wrapp and its potential market. On the one hand, the ruthless Rocket Internet incarnated in the form of Dropgifts, on the other hand, the Swedish underdog Wrapp. The game’s on!