Tell us about Wrapp? Who is behind the business?
Wrapp is a new social gifting service that lets you use your smartphone to send free and paid digital gift cards offered by top brands to all of your Facebook friends. The digital gift cards are then stored in the Wrapp Wallet on the recipient’s phone, so they’re always in your friend’s pocket, ready to use.
Wrapp was started earlier this year by some of the best and brightest young entrepreneurs in Sweden, including Andreas Ehn, Spotify’s founding chief technology officer; Hjalmar Winbladh, founding CEO of Rebtel, and Sendit; Carl Fritjofsson, former strategy advisor to Groupon.se; Aage Reerslev, founder of mobile browser Squace; and Fabian Mansson, former CEO of H&M and Eddie Bauer.
How did you and your co-founders come up with the idea?
Early this year we started looking at what was going on in the world and the mega-trends impacting our daily lives. Smartphone penetration was exploding. Everybody was on Facebook – some 700 million of us worldwide. And the global economy was a mess, making life miserable for retailers. Then we found that one of the most popular items in the retail industry was a gift card. In the U.S. alone it’s worth more than $100 billion a year. But not much has happened with it during the past 50 years. Paper cards have turned into plastic cards, and that’s about it – and there is still a lot of friction in buying and giving them. So, it was clear there was room for real innovation. We put all those ingredients together, turned it up-side down and in-side out, and out came Wrapp – a business that disrupts the gift card market in a positive way – actually makes it larger – by making it social, digital and mobile.
Wrapp combines two very hot trends, mobile and social media. What do you think will make Wrapp successful? Is there something similar in the market?
There’s no shortage of companies in the social gifting category but what makes Wrapp unique is a few things:
Wrapp is first to make it just as easy and fun to send gifts of real value to your friends and family, as it is to say Hi or Happy Birthday on their Facebook wall.
So, by making gift cards mobile, social and digital, gift giving can now be an everyday event. Thank-you, Monday, a new job – whatever – everyone loves to be recognized and celebrated.
And for retailers, Wrapp is the first low-risk, low cost customer acquisition platform for improving in-store sales using precision targeting that drives only desired on-line consumers into stores. And, it’s pay for performance; retailers don’t pay until the gift cards are redeemed in-store.
Just the free gifts business creates a strong company; the contributions mutual friends add to gifts will make Wrapp great.
You took the business to launch in a very short time. What do you think made that possible?
We have a great tech and design team led by Spotify’s former CTO, Andreas Ehn.
But equally important, is that top retailers have quickly recognized our unique offer and the benefits of becoming a Wrapp partner. Many merchants have found that daily deals and deal-hunters dilute their brand’s value and is bad business because it drives the wrong traffic to the store and doesn’t generally foster repeat business. In contrast, Wrapp has found a way to make friend-to-friend marketing real and accessible to many retailers for the first time ever.
How did you market the idea to retailers? What have been the challenges in getting traditional retailers on board? Is it easier if they already have a mobile strategy?
Retailers are no fools. They know they must have mobile and social strategies if they are going to survive today. The problem is that until now it’s been a crapshoot for many when it comes to adopting cost effective and measureable programs. With Wrapp the get both.
Wrapp is a pay-for-performance platform – the retailers only pay when a gift card is redeemed. Wrapp allows them to target specific demographics – they’re able to offer free cards only to exactly whom they want in their stores. Wrapp generates real-time performance and customer demographic data – valuable information that’s measureable and can be used to tune their campaigns. And last, and possibly most important of all, with Wrapp friends are marketing the brand to friends. In my opinion it doesn’t get better than that.
Your proposition is B2B and B2C, what are the difficulties in developing products that must appeal and work for both groups?
First and foremost we have to delight consumers. They have to love what we’re offering and use the service often, if not every day. So the benefit to the consumer has to be instantly understandable.
Just as important, the app has to be super simple and intuitive to use. If we’re not making people’s lives easier, better and more enjoyable, what’s the point?
For the retailers, it’s all about delivering on the promise – actually delivering the shoppers into their stores that they know, based on demographics, are the most profitable.
So far, so good on all fronts – at least in Sweden, and soon in the UK and US.
You have recently secured some significant VC-funding from Atomico. What will this enable you to do?
Just having the advice, counsel and attention of Niklas Zennström is epic for us. He brings amazing insight, experience, knowledge and relationships that will be crucial to our ability to expand and scale quickly around the world. But the funds are also important because they allow us to hire a few more people and increase our marketing efforts that are required to successfully enter new markets – first and foremost the UK and US.
What are Wrapp’s aspirations for the future?
We believe Wrapp can disrupt the gift card industry for the better – actually make it bigger than it already is worldwide – by making it mobile, social and digital, and in so doing, become the de-facto standard for Internet gift giving among friends.
Where are your offices right now and how many people work in the business? What type of person fits into the Wrapp culture?
We currently have three offices: Stockholm, London, and Silicon Valley. There are just 15 of us right now, going on 17 going on 20.
We’re looking for a few fellow entrepreneurs, who are creative, relentless, and know the retail industry.
What is your personal background prior to co-founding Wrapp?
I’ve had a bit of a scrappy past (pun intended). I started my career as business development manager at Stena Metall AB, which recycles and processes metals, paper, electronics, hazardous waste and chemicals in five geographical markets. But just before Wrapp I was global sales director of the Online Division at Metro International, the world’s largest urban newspaper and business intelligence firm. And before that, I was with TradeDoubler, the international performance-based digital marketing company, where I was the agency service director.
Outside of your own market, what do you think is the hottest emerging trend or technology right now?
We’re focused on retail and gift giving but the hottest emerging trends are the same within and outside of our market: mobile, social and global.