yougotagift.com was founded in April this year after an entrepreneur tried to buy a gift card online for a friend and the service did not exist in the UAE.
Online mall takes the legwork out of gift-giving
Like many business ideas, yougotagift.com started out as a way to solve a problem.
A year ago, Husain Makiya, one of the founders of Zawya.com, the finance portal which was sold to Thomson Reuters, was due to attend a friend’s birthday party.
“The birthday girl told us through Facebook don’t bother to get me any gifts. Just get me gift cards for certain brands,” he says.
But being a reluctant shopper, Mr Makiya searched for a way to buy the gift card over the internet, to save him a trip to a mall.
“There was no real option to do that, so the idea was triggered: why can’t I buy my gift cards online? That’s how the idea was initiated. There was nothing like that in the region,” says Mr Makiya.
So he and his colleague, Abed Bibi, decided to set up the first online mall for gift cards in the Middle East. The pair are partners in Honeybee Tech Ventures, a consumer internet incubator set up by the founders of Zawya.
Honeybee had already set up two successful internet ventures, Laimoon.com, a portal for jobs, courses and events, and Roundmenu.com, an online service which helps people find and book restaurants in Dubai, when it launched yougotagift.
The idea behind its latest venture was simple, says Mr Bibi.
“Today people can be connected on Facebook, Twitter and Google Plus and so many other places, so why not also make things more convenient for them and create something where they can send and make other people happy? They can do group gifting or send a gift without having the hassle of going to the car, parking in the mall and then buying a gift and maybe the person won’t like it.”
Yougotagift was launched on April 1 this year with just over 20 brands. Today it stands at around 45, including Virgin, Vox Cinema and Ferrari World, with a further 15 expected to be signed before the end of the year. Current partners include Azadea Group, Al-Futtaim Group, Majid Al Futtaim and Landmark. The company has also held talks with Chalhoub Group and Al Tayer.
The online venture is designed to appear like a mall, with each of the available stores displayed on the home page. Once they make their choice, customers can send the gift card to friends via email, text message or Facebook. Alternatively, they can print the gift card out and present it by hand.
The average transaction is about Dh450, according to Mr Makiya. It has sold more than 200 gift cards since the launch and traffic is up 70 per cent month-on-month, while transactions have been doubling in the past three months.
However, more people than ever in the UAE are shopping online, according to the research firm Euromonitor.
“By the end of 2013, internet retailing is expected to increase by 20 per cent in current value terms,” says Fatemah Sherif, a research analyst at Euromonitor International.
“Not only are consumers spending more time online, be it on their PC from home or work, smartphone, PC tablet, but they are also becoming very tech-savvy in the sense that they are more accustomed to making online transactions to fit with the more convenient lifestyle that they seek,” she adds.
However, a significant percentage of yougotagift’s customers are based outside the UAE.
“More than 20 per cent of our traffic or purchases have come from outside the UAE — UK, New Zealand, Saudi Arabia, Lebanon,” says Mr Makiya.
“We are an expat community with a lot of family and friends living abroad. And this is the most efficient, easiest way and most cost- effective way of sending a gift from any country in the world.”
And with ambitious plans to expand, some of its overseas customers may get the opportunity in the coming months to buy gift cards on yougotagift for friends in their own country. The company aims to open in Saudi Arabia in the first quarter of next year and it is looking at opportunities in Lebanon, Qatar and even farther afield.
“When we cofounded yougotagift, our vision was to be the online mall for gift cards in the Middle East. Probably later on it will go global, but now the online mall is where you can find your brands, put a nice personal message with nice pictures and in the future there are many ideas,” adds Mr Bibi.
“This can be expanded and we believe this is the way forward.”