First Data, which manages transactions for banks and retailers, announced yesterday that it has acquired digital gift card company Gyft.
By combining resources, the two companies, will be able to offer consumers increased flexibility when shopping and spending gift cards.
First Data manages transactions, similar to the way a credit card company manages transactions, for financial institutions and popular retailers such as Panera Bread, Kohls, and North Shore Bank.
Gyft is a digital platform that lets you buy, send, manage, and redeem gift cards through a smartphone. You download the free Gyft mobile wallet app (available for iOS and Android) or access an online account on the web. The mobile wallet then lets you manage gift cards from multiple retailers, keeping the cards stored on your mobile device.
Merchants accepting Gyft can upload gift cards from their register to a customer’s phone. The platform also allows merchants to build promotional programs through the Gyft Cloud.
Gyft already has partnerships with more than 200 popular retailers and has been featured on the TV show Ellen, in Forbes, and in the New York Times.
First Data’s clients include more than 300 national retailers. It hopes that acquiring Gyft will give its customers access to a new and growing distribution channel to digitize their gift card programs.
The latest acquisition is part of a series of innovative solutions introduced by First Data over the last 12 months.
The U.S. gift card market is about $100 billion annually, according to research conducted by TowerGroup. According to a survey conducted by the Mercator Advisory Group, money loaded onto digital gift cards tripled from 2012 to 2013, while First Data estimates that electronic gift card sales grew 71 percent from 2012 to 2013.
Gyft will be added to First Data’s Clover App Marketing place. Analytics available through Gyft and First Data’s technology will give merchants the ability to create flexible, cost-efficient campaigns to target new customers, the companies say.