Yiftee, the service for sending local gifts to friends, has opened its “GiftUp” API with the hope that developers will incorporate its gift-giving capabilities into their own apps. Yiftee is banking on the notion that people will be more inclined to send gifts in context. When a calendar app notifies you of a friend’s birthday, for instance, it could also suggest that you buy her a cupcake from the local bakery.
At the moment, Yiftee has homed in on dating apps and social network platforms as their primary targets, CEO Donna Novitsky said, since the holidays and Valentine’s Day mean that people will be looking to buy presents for others. Through a partnership with Mastercard, Yiftee works with more than 2 million retailers.
The big competitor here is Facebook Gifts, which recently underwent a redesign that ended the sale of physical gifts in favor of digital gift codes or Facebook’s Gift Card. Although Facebook Gifts manager Lee Linden, previously the CEO of gifting app Karma before it was acquired by Facebook, said revenue from gifts is increasing, it has historically proven to be a tough sell to users, paling in (revenue) comparison to ads and games.
So can Yiftee do Facebook one better? Since integrating with Yiftee’s gift functionality now only involves adding a few lines of code, it wouldn’t be surprising to see apps testing it out to see if it takes, since it could be an easy point of new revenue.
“One of the main feedback points we’ve had is that we’ve talked to all these awesome apps, but they don’t have a way to monetize,” Novitsky said. “With apps, there are in-app purchases, and this gives them another channel to monetize.”
Yiftee will monetize on this through revenue sharing, with the plan to charge a $1 or 3 percent convenience fee for in-app gift purchases, whichever is greater. It takes a 75 percent cut of that.
Last we heard from the startup, they had raised $850,000 in seed funding from Scott Cook, Mohr Davidow Ventures, and other angel investors. In August, the team launched a feature for gifting to college students, an update on care packages.
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