During Firoz Khan’s stint in Future Group, he noticed that gift vouchers were getting good traction on the company’s online store. This got him thinking on how he could bring this category to the fore for every consumer and make it easy for them to purchase or send gift vouchers to their family and friends. “When I did my research, I realised that not a single business was focused on this category. Given my experience in the e-commerce and retail business, I thought I could indeed solve this problem and started writing a business plan,” he recalls. Soon he started Gift Cards India (GCI) along with Cory York, whose experience across companies like ftd.com (Canada), Interflora UK, Adidas and Warner Brothers (on their online e-commerce technologies and strategic implementations) added value to GCI.
BRANDS WERE ONLY RETAILING THE GIFT CARDS THROUGH THEIR OUTLETS. WE CREATED A PAN-INDIA DISTRIBUTION NETWORK FOR THESE CARDS TO BE MADE AVAILABLE TO A WIDER NETWORK OF CUSTOMERS
“We often think of gifts only at the very last minute and don’t know what to gift someone on an occasion,” opines Khan, and adds, “Most of the times, we have bought or received gifts which are defective or are not quite right and dealing with returns and exchanges in such cases can be very time consuming. Online gifting options eliminate this process and ensure we don’t pick or receive the wrong gifts.” Through GCI, Khan sought to solve two issues – one, to provide customers with easy access to gift cards and vouchers and two, to reach merchant brands. “Brands were only retailing the gift cards through their outlets. We created a pan-India distribution network for these cards to be made available to a wider network of customers,” says Khan.
With over 15 years of experience in the e-commerce and retail space, Khan and Cory have now taken the company to a level where it has more than 250 retail brands spread over 12,000 outlets, across categories selling through a multichannel – online and offline distribution network. GCI was self funded until 2012 after which Malur Narayan, a senior executive with TCS, invested in the company at an early stage. Towards the end of 2014, the company received an initial funding from Blume ventures and Google India MD, Rajan Anandan, to expand the team, develop new products and increase reach. Along with the expansion plans, GCI also acquired Giftery, a social gifting website based in Mumbai. At present, the company operates with a small team of 10 employees. Through its multichannel 25,000 points of sale ( B2B and B2C network), it has sold over three lakh pre-paid cards in less than four years.
Growing its brand
GCI’s aims to make the prepaid and gift cards category easily accessible to the end customer. It has started selling a small set of brands through its online portal www.giftcardsindia.in. It also offers products like super card, gift card, gift certificate, gift vouchers and e-voucher to its customers from India, U.K., U.S. and Singapore. Its gift cards or vouchers start from Rs. 500 and go up to Rs. 50,000 and also have an instant delivery option. The company has clocked a growth rate of more than 200 per cent on a year-on-year basis, and has sold over three lakh prepaid cards, has 25,000 points of sale nationwide and has one lakh customers visiting its website on a monthly basis.
However, these targets have not been achieved without their share of challenges. “We did face a few challenges initially in getting the merchants on board, as many of them didn’t want to be present on the same platform as their competitor. But our initial sales and registered customer numbers helped us change this mindset,” says Khan. Today, GCI works closely with all its 250 brand partners to market and sell their gift cards. “Our partnership with American Express and AXIS Bank has helped us build credibility in the industry,” shares Khan.
The other challenge it faced was in bringing customers onto the platform to purchase gift cards. “Given our experience in the online and retail business, we were able to tackle this issue effectively and could drive customers to our online store first before we could expand to brick and mortar,” says Khan. The other factor that helped them was the general evolution seen in the online gifting space. With the advent of digital gifts and cyber deliveries, there are now easier ways to give and receive gifts. “The traditional gift cards take the guesswork out of picking a present whereas e-gift cards take the work out of gift-giving almost entirely. Time is money and the most time and labour-intensive part of buying a gift is often in figuring out what to buy. Online hints and tips eliminate this part of the process,” shares Khan.
Expanding its network
GCI introduced the digital card super card right at the early stage of business. Super card gave the recipient the freedom of choice to select any brand’s gift card and redeem it at the respective store. “Super card became our best selling product and differentiator from our competitors,” states Khan. The company also started powering the rewards redemption process for many loyalty companies.
Going forward, the company is working on multiple prepaid products in the mobile and physical form and an app (for android and iOS) which will help consumers redeem their gift cards in real time. This digital gift card will eventually help them enter the global market.
It is also expanding its distribution network pan-India in the next two years. “This will help the consumers order a gift card / gift voucher from the most convenient locations,” says Khan. With all these strategies in place, the company aims to reach a turnover of Rs. 100 crore in the next two years.
Gift Cards India
Founder: Firoz Khan and Cory York
Year of incorporation: 2011
Concept: Gift Cards aims to make prepaid and gift cards category easily accessible to the end consumer. It provides products like super card, gift card, gift certificate, gift vouchers and e-voucher to its consumers from India, U.K., U.S. and Singapore.
Funding: By Blume ventures and Google India MD, Rajan Anandan
Turnover: targets turnover of Rs. 100 crore in the next two years