Giftek provides a mobile gifting service that allows users to send gifts in real-time to friends who check in at partner restaurants. Giftek's original business model involved 3 gift price levels and involved 4 parties: the gift sender, receiver, restaurant, and Giftek. The revised business model streamlined the gifting process and payment flow. The U.S. e-gift card market is growing significantly and projected to reach $12 billion by 2015. Giftek's potential daily market in Turkey is estimated at 4,637 gift recipients. Giftek's expected annual revenue is $1.78 million with a 15% commission. While no competitors offer Giftek's location-based gifting, convincing restaurants to partner may

1. GIFTEK Market Analysis
27/05/2013

2. STRUCTURE
Revised Business Model 4-9
Business Model – Drawbacks and Difficulties 10
E-Gift cards market in the U.S. 11,12
Market Size 13-15
Competition Conclusion 18
VOS Screening 19
16.04.16 2Giftek Market analysis
Original Business Model of Giftek 3
Competition 17
Revenue Forecast 16

3. GIFTEK’SBUSINESSMODEL
Original Business Model of Giftek
16.04.16 3Giftek Market analysis

4. Giftek makes agreements with selected restaurants or cafes
The strategy in order to facilitate the market entry is:
• First Target: small restaurants → more flexible regarding changes (i.e. menu)
• Second Target: big food chains → high attractivity for users & high visibility
• Third Target: attack customer base of competitors. If Giftek users check in within
a 100m of a «Giftek location» the gifting process can be initiated.
There are 3 types of gifts
• Tea (low price)
• Coffee (average price)
• Dessert (high price)
There are 4 parties involved in the process:
• Gift sender
• Gift receiver
• The Restaurant or Cafe
• Giftek
BUSINESSMODEL
Revised Business Model
16.04.16 4Giftek Market analysis
1
2
3
Background Information

5. The Gifting Process
• The gift sender downloads the application. After that, he has to decide whom he wants to
follow from the facebook or foursquare friend list.
• The gift sender is advised to choose only a small circle of friends (his closest friends) in order
to avoid notfication spam.
• The gift sender receives a notification when one of his selected friend checks in to one of the
«Giftek locations». He decides for a type of gift and sends it (with an optional personal
message) by using the application.
• The gift receiver gets an sms with the download link for the application. After downloading,
he can approve and receive the gift. He has to download the application in order to accept
the gift.
• There could be other options for accepting the gift, but this option increases the user base
and sending notfications is free (unlike sms service). The gift receiver of today might be a gift
sender of tomorrow.
BUSINESSMODEL
Revised Business Model
16.04.16 5Giftek Market analysis

6. BUSINESSMODEL
Revised Business Model
16.04.16 6Giftek Market analysis
Start
Gift sender chooses his
friends
One Friend checks in
Gift sender receives
notification
Gift sender wants to
buy a gift
Gift sender selects gift
Gift sender sends gift
to Gift receiver
Gift receiver accepts /
rejects gift
Gift receiver uses gift
immediately or stores it
no Order is cancelled
Useit
Gift Animation is
opened
Shows it to waiter
Receives gift
Payment
process is
initialized
The Gifting Process

7. BUSINESSMODEL
Revised Business Model
16.04.16 7Giftek Market analysis
Start
Gift sender chooses his
friends
One Friend checks in
Gift sender receives
notification
Gift sender wants to
buy a gift
Gift sender selects gift
Gift sender sends gift
to Gift receiver
Gift receiver accepts /
rejects gift
Gift receiver uses gift
immediately or stores it
no Order is cancelled
Useit
Gift Animation is
opened
Shows it to waiter
Receives gift
Payment
process is
initialized
The Gifting Process

8. Gift Animation
BUSINESSMODEL
Revised Business Model
16.04.16 8Giftek Market analysis
Date:
01.08.2013
Restaurant:
standard +
You get a
coffee for free!
Congratulations
Joachim,
you have a gift!
This screen is for
notification
processes. Just
showing the screen
to the waiter is
sufficient. The
screen is animated,
the date will blink
in order to avoid
misuse.
Date will
blink

9. BUSINESSMODEL
Revised Business Model (Cash Flow)
16.04.16 9
The Restaurant
Giftek
Collectivebillatthe
endofthemonth
E-bill
Gift senderGift receiver
Paysbillafter
takingcommission
The payment via creditcard or
paypal is only initiated if the
gift reciver accepts.

10. BUSINESSMODEL
Business Model – Drawbacks and Difficulties
16.04.16 10Giftek Market analysis
Risk Solution
1 The restaurants might not be easily persuaded because
their standard processes are needed to be modified.
Keep the commission low and make them realize
the high visibility they can get in the social media
world, and it provides additional revenue.
2 If we use Coupon codes for receiving the gifts, the waiters
have to put too much time and effort into the process.
Use animation for the app where date, name of the
recipient, of the concrete restaurant and the gift
(type) is to be seen.
3 The gift-receiving person might leave the restaurant
without using the gift.
Create an enhancement to the app to keep the
gifts and use it another time.
Send notification also when a Giftek user is within
100 meters of a «Giftek location».
4 The restaurants charge Giftek at the end of every month
with a colletive bill. They might not want to take that risk.
Sign contracts and convince them that it is less
effort for them. Also, we want to create a «social
media gift giving culture», so people use the
application more than once a month.
5 The restaurants might refuse to pay the mail and paper
costs when they have to write bills for Giftek each month.
In Giftek database the amounts for each restaurant
and each month be recorded and collected. The
restaurant will be able to monitor that amount
also. The payment will be realized by Giftek to the
restaurant’s account automatically at the end of
month.
6 Some people might abuse the application and send gifts to
a person who does not want them
Unlikely, because the people who can send gifts
are already in the friend list. However, there will be
the option to reject the gift

11. THEE-GIFTCARDMARKETINTHEUS
Reasons for using e-gift cards as a present in the U.S. Market
16.04.16 11Giftek Market analysis
60
52
44
35
33
29
25
2
0 10 20 30 40 50 60 70
Immediate Delivery
Easier to email an e-gift card than mail a physical gift card
They are easier for the recipient to redeem
It's an environmently friendly way to give a gift card
They are easier to purchase tan traditional gift cards
They are harder to lose than the traditional gift card
It's a cool gift to give
Other
%
Source: First Data Consumer Insights into the U.S. Gift Card Market: 2012
At first electronic gift cards may seem to change user habits but it is evident
that they are well accepted in the market.

12. THEE-GIFTCARDMARKETINTHEUS
E-Gift Card Market
16.04.16 12Giftek Market analysis
Digital gift card spending is
projected to grow from $3
billion in 2013 to $12 billion
by 2015, according to CEB
Tower Group.
U.S. social commerce is
projected to grow from $3
billion in 2013 to $14 billion
by 2015, according to
Forrester Research.
U.S. mobile ecommerce is
projected to grow at a 39
percent annual growth rate
to $31 billion by 2016.
There is a market for digital/mobile gifting,
and especially in the U.S. many startups are
aware of that. However, the idea of location-
based gifting is not out yet, which means a
competitive advantage. The question is: How
big is the market size for that?

13. Facebook has 1.1 billion users in the world and 32m
users in Turkey (2012). In the world, 4m facebook
users checkin daily. If we transfer this ratio on the
Turkish market (32m facebook users), we have ca.
125.000 facebook checkins daily.
70 %
Number of Facebook
Users in the World
1.1 billions
Number of
Facebook users
in Turkey
32 million
Number of daily
Facebook users
checking into
Giftek nearby
location
87.500
Number of daily
Facebook Check
ins
in Turkey
125.000
Number of daily
Facebook users
checking into
Giftek nearby
location and
having a Giftek
friend
4.375
Number of daily
Facebook user
checking into
Giftek nearby
location and
having a Giftek
friend who sends
them a gift
437
5 % 10 %
MARKETSIZE
Market Size for Facebook Users in Turkey
16.04.16 13Giftek Market analysis

14. MARKETSIZE
Market Size for Foursquare Users in Turkey
16.04.16 14Giftek Market analysis
Foursquare had 10m users and 3m daily checkins in
2011. In 2013, Foursquare has 40 Million users,
therefore the number of daily checkins can be
assumed to 9m. 10 % of the foursquare users come
from Turkey.
70 %
Number of
Foursquare Users
in the World
40 millions
Number of
Foursquare
users in
Turkey
4 million
Number of
people
checking into
Giftek nearby
location
840.000
Number of
daily
Foursquare
Check ins
in Turkey
1.2 million
Number of
people
checking into
Giftek nearby
location and
having a
Giftek friend
42.000
Number of
people checking
into Giftek
nearby location
and having a
Giftek friend
who sends them
a gift
4.200
5 % 10 %

15. MARKETSIZE
Market Size
16.04.16 15Giftek Market analysis
40 millions
Number of
Foursquare
users checking
into a Giftek
nearby location
and receiving a
gift
4.200
Number of
Facebook
users checking
into a Giftek
nearby
location and
receiving a gift
437 4.637
+
Number of people checking into
Giftek nearby location and
receiving a “Giftek gift” in Turkey
on a given day.

16. REVENUEFORECAST
Revenue Forecast
16.04.16 16Giftek Market analysis
Tea: 3 TL → 50 % of revenue
Coffee: 8 TL → 30 % of revenue
Dessert: 15 TL → 20 % of revenue
Average price: 7 TL
Number of
people
checking into
a restaurant
and receiving a
gift
4.637
Average
daily price
of a Giftek
present
7 TL
Daily
sales
32.459 TL
x = x 365
1.777.130 TL
Expected Revenue
4.868 TL
x 15 %
commission

17. COMPETITION
Competitors
17
Giftly Giftrocket Giftya Giftek
Business
Model
Gift sender chooses
item, price, place and
recipient. The gift
reciver gets a
notification via email,
facebook or text sms.
The merchant is not
involved at all. Giftly
sends the money to the
credit card of the gift
receiver.
Gift Sender chooses
gift. Delivers it as e-
gift-card or printable
card by using
Giftrocket. Gift
receiver redeems
online and gets
money reimbursed in
3-10 days.
Same Business
Model as GiftYa.
Gift sender chooses price and
merchant and delivers his gift
via giftya. He chooses the gift
receiver via his adress book or
friend list. Gift receiver gets
notification via sms or
facebook. Gift receiver
redeems Gift card ang gets
money reimbursed. Same
Business Model as Giftrocket.
Giftek has
arrangements with
special restaurants.
Gift sender can send
realtime gifts to gift
receiver. Restaurant
charges Giftek
monthly for the
service. Giftek gets
commission.
Country USA USA USA Turkey
Location-based
Gifting
no No no yes
Locations to
use the gift
all categories all categories all categories Only selected
restaurants and cafés
Mobile App Yes
(3 ratings, Ø 1.5 *)
no no yes
Received
Investment
Total Funding $2.8 M Received Angel Fund
of unknown amount.
Total Funding $ 1 M. no
There is no direct competitor in Turkey. Gift applications in the U.S. have all more or less similar business
models: The Gift receiver has to pay for his gift first and has to choose how the money is reimbursed after
that. According payment method the time of reimbursing the money can take up to 3 days to one week.
Also, none of the application provides tracking the location of the friends.

18. COMPETITIONCONCLUSION
Competition Conclusion
Giftek is the first mobile GiftCard applications that is locations based and
enables people to send their friends real-time gifts.
Giftek is the only mobile GiftCard application where the gift receiver
does not have to pay for his gift first.
The market size for Giftek is ≈ TL 2M. This number has potential to
increase fast if the business model is accepted by restaurants and users.
Also, the business model has potential to be implemented abroad.
There are many risks that might impede the success of Giftek. Convincing
the restaurants is a key issue to make the business model work. Charging
Giftek at the end of the month is requesting trust, which has to be
earned. Also, Giftek needs to grow fast in order to keep the first mover
effect and make agreements with big restaurant chains first.
16.04.16 18Hayyam Çarşısı Market analysis
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19. 16.04.16 19Hayyam Çarşısı Market analysis

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