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Name:Wrapp
Quick Pitch: Wrapp provides free gift certificates that can be posted on friends' Facebook walls.
Genius Idea: A social delivery for online advertising.
Instead of adding another "happy birthday!" comment to your friends' Facebook walls, Wrapp wants to let you post a gift certificate that might not even cost you anything.
The company, which announced on Thursday that LinkedIn Co-Foudner Reid Hoffman would join its board, partners with brands looking for a better way to gain exposure online. These brands already spend money on special offers and discounts. Letting friends deliver those discounts as gift certificates makes the package more effective.
Since November, the service has been available in Sweden only. Wrapp co-founder Hjalmar Winbladh says a launch in the U.S. and U.K. is planned for the end of the first quarter.
Before you get too excited, there are a couple of catches. The first is that certain free gift certificates are only available for certain friends — depending on how favorable their demographics and location are to the advertiser. The second is that 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 flat fee from the merchants for every person who redeems a gift certificate in one of their stores. It also collects a commission for paid gift certificates and group upgrades.
The redemption process is pretty easy. As soon as the gift hits a Facebook wall, it becomes a group gift to which anybody can add. The recipient can use Wrapp's Android or iPhone app to show a barcode that redeems the gift at the store. Since launching there, Winbladh says the startup's users have distributed 250,000 giftcards — on average about three per week.
"Even though only 2% of Facebook users in Sweeden are users, we can reach 90% of Facebook users in Sweden through them," Winbladh says.
Brands are itching to get onto Facebook walls in a social context. That's what Sponsored Stories are about. But this is a much more natural way for consumers to include them. And it could also be a very profitable one.
Image courtesy of iStockphoto, kutaytanir
Series Supported by Microsoft BizSpark
The Spark of Genius Series highlights a unique feature of startups and is made possible by Microsoft BizSpark, a startup program that gives you three-year access to the latest Microsoft development tools, as well as connecting you to a nationwide network of investors and incubators. There are no upfront costs, so if your business is privately owned, less than three years old, and generates less than U.S.$1 million in annual revenue, you can sign up today.
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