Instagift connecting both businesses and consumers to electronic - ABC 33/40 - Birmingham News, Weather, Sports

Instagift connecting both businesses and consumers to electronic gift cards

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Tucked away in an unsuspecting office space at Birmingham's Innovation Depot, Instagift has begun to thrive as a consumer-friendly gift card service for small businesses.

"When you need a gift card, you need it fast," said company co-founder and CEO Nate Schmidt.

Instagift's Silicon Valley-like office has been a fitting addition for one of the nation's premier, up-and-coming technology hubs as it provides a relaxed, yet efficient atmosphere for its small workforce. Employees can routinely be found taking afternoon breaks from the daily grind for a few games, a growing trend among hip new companies, startup and established alike, around the country. But don't be fooled by the laid-back rituals. When it's time to work, Instagift does just that.

The company caters mostly to small businesses looking to get into the gift-card market, one that's seeing a large growth online and geared towards mobile consumers. 

"The giftcards that we provide are as consumer friendly as possible. They are easily accessible and that they can be used multiple times," said Schmidt.
 
Instagift allows businesses to set up and sell online gift cards that are sent directly to your mobile device.
 
"There's a huge movement going on right now whether they realize it or not. They are buying gifts online, whether it be daily deals or event tickets and they are printing those things out," said Schmidt.  

Analysts expect the average person to spend more than $160
on gift cards alone this holiday season, and until now, many small business owners had felt shut out of the revenue opportunity with gift cards. One of those companies is Cahaba Cycle, a longtime staple in Birmingham. The bicycle shop enlisted the help of Instagift and found instant success. 

"We took advantage of the cyber Monday promotion. So, we ran a very aggressive promotion and we sold over 200 gift cards that way in one day. So, that was really successful for us," said Faris Malki, Co-owner of Cahaba Cycle. 

"We're showing businesses how to increase their gift card sales by double digits. And this is most evident on days like December 20 through 25.  Those are the five heaviest gift card days gift card days of the year," said Schmidt. 

Instagift works by customers going to a website that partners with the tech company. Consumers purchase a gift card from the company's website then the card is sent to their mobile device where expenses can be tracked and funds managed. 
     
"There is never a risk of losing something. You can log in at anytime and see what you've purchased and you can also elect to use a subset of the value," said Schmidt. 

Many consider the technology a breathe of fresh air for gift card users as the Instagift gift cards never expire and there are no dormancy fees. 

For the embattled shoppers struggling to find the 'perfect' gift this holiday season or businesses looking to increase holiday sales, online gift cards could be the answer in 2013.

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