E-commerce: Say it with social gifting

Given the growing penetration of smartphones, social networks and the advancements of mobile payment technology in Southeast Asia, social gifting could be about to take the region by storm, according to Brian Riley of CEB TowerGroup, a consumer financial monitor.

Social gifting allows users to send gift cards to their social network via mobile or desktop applications. It has become an increasingly attractive e-commerce platform for retailers in the West, as it allows them to attract sales without increasing marketing costs.
Made popular by Wrapp, a Swedish start-up that launched in 2011, social gifting is blurring the lines of cross-channel commerce. By allowing users to give a mobile gift card from retailers such as Starbucks, ASOS or H&M, platforms such as Wrapp are making it easier for consumers to shop how, when and where they want.
“Asian markets are particularly prime for development as their mobile payment technologies are far more sophisticated than North America,” says Riley, adding that countries such as Malaysia will set the pace. Riley predicts social gifting will also be a hit in countries that send large numbers of migrant workers abroad, such as the Philippines.
In Southeast Asia, a culture where giving gifts signals the status of the giver, luxury brand retailers may stand to benefit greatly from the trend, which is expected to prompt the evolution of industry regulation.
Facebook’s acquisition of social gifting startup Karma, which allows the receiver to personalise, swap or donate their gift to charity, signals the significance of social gifting. “We already shop, buy gifts and wish our friends happy birthday online,” says Tamara Littleton, CEO of eModeration, which manages social media. “Buying a birthday gift through Facebook just ties those things together.”