Gift giving is not for sissies. It can get expensive, especially when it comes to occasions like weddings and other rites of passage that call for special gifts. You don't want to look like a cheapskate, but what do you do when everything listed on the gift registry is more expensive than you can afford?
Let's Gift It thinks online group gifting is the answer. It's a way for friends, family and colleagues to pool their money to purchase a gift for special occasions like weddings, birthdays, baby showers and anniversaries without bankrupting themselves and disappointing the gift recipient.
"Consumers will often not purchase off a gift registry or will purchase something they can afford," said Ryan O'Donnell, Let's Gift It's co-founder.
Of the 1.8 million couples registered on The Knot , O'Donnell said, at least 1.4 million put a high-ticket item on their gift registry in hopes of getting a group; 1.3 million actually receive one.
This New York City-based startup understands the downside of group gifting. It's all in the details. Collecting money, feeling obligated to give, and dealing with long email threads can be a pain. To take the friction — and frustration — out of group gift giving, the company has created an online service to make giving fun, easy and social.
"The idea was born from three different personal gift situations last summer," O'Donnell told BusinessNewsDaily. "There wasn't a smooth way of handling it. As any entrepreneur would, I got a team together and built one."
To create a gift an organizer begins by going to the Let's Gift it website and selecting the person to receive the gift, either from a list of Facebook friends or by entering the recipient's name. Next, the gift is selected, which can be either a gift card or an item carried by an online retailer, and the value of the gift card or the product URL is entered.
The organizer then selects the occasion, date and creates account settings, such things as a minimum contribution, when contributions will be closed and whether the gift will be public or private. Anyone can contribute and invite friends for public gifts.
The process is completed when the organizer makes an initial payment by debit or credit card and invites people to participate in the group gift. Personalized invitations to join the group gift can be sent out to Facebook Friends or by email to people imported from an email address book.
People participating in the gift are able to check on the progress of the gift and see who has contributed to the gift.
"There is a critical social component to group gifting," O'Donnell said.
If more money is contributed than a gift costs, the recipient receives a gift card for the overage. And in the event that the gift is underfunded, the recipient receives a gift card for the full amount contributed.
People contributing to the gift are accessed a 4 percent service fee by Let's Gift It.
Let's Gift It currently operates as a destination site, but the company is refining its business model and has entered into discussions with major retailers to be on their sites, functioning like an affiliate and receiving a commission on sales.
"How do we get in front of customers while they're considering purchases?" O'Donnell asked. "The best move for us initially is to be on retailer sites. We had that epiphany in March.
"It's the goal of every good entrepreneur to prove or disprove their business hypothesis as soon as possible," O'Donnell said. "With Let's Gift It, our early hypotheses have proven true."