A growing trend in the online shopping category is social shopping. Two interesting well-funded companies operating in this space are Curatemedia (owner of ThisNext and Stylehive) and Polyvore. Both add a social layer to the online product discovery experience. Despite this activity, however, there is still a lot of online shopping which doesn’t incorporate social elements, with traditional comparison shopping engines maintaining a focus on search engine marketing arbitrage rather than building an engaging user experience that users will return to.
The Gifts Project takes the concept of social shopping and applies it specifically to group gifting. Via a Facebook application, the service allows users to identify gifts that they would like to give/receive to/from friends for a particular occasion (e.g. birthday, anniversary), and then allows users to select up to 20 friends to contribute to the gift purchase. The notion of having friends chip in to gifts for other friends is clever, and there is significant market growth potential in online group gifting (given that the majority of this activity likely still takes place offline). The advantage of being able to reach out to one’s social graph is compelling.
The main barrier to adoption is the fact that friends need to actually pay to effectively use the service (each contributor must pay a minimum of 0.5% of the cost of the gift). However, given that paid-for virtual gifts have proven to be so successful in the social context, there is no reason to believe that the success of real gifts will not follow a similar trajectory. It is early days for this startup, but as the line between normal online shopping and social shopping become increasingly blurred, The Gifts Project stands to benefit by giving people the option to give/receive real gifts by leveraging the social graph.
Latest posts by gmugliston (see all)
Subscribe to VC Cafe via email
VC Cafe Categories