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Table of contents
Contents
TITLE ........................................................................................................................................................ 3
GIFT CARD MARKET ................................................................................................................................ 3
GIFT CARD MARKET IN INDIA .................................................................................................................. 4
QWIKCILVER ............................................................................................................................................ 4
Brands ................................................................................................................................................. 5
How It Works ...................................................................................................................................... 6
QwikCilver Key features ...................................................................................................................... 7
Distribution ..................................................................................................................................... 7
Plastic Card Manufacturing ............................................................................................................. 7
Integration ...................................................................................................................................... 7
Analytics .......................................................................................................................................... 7
Consumer Services .......................................................................................................................... 7
Mobile wallet ...................................................................................................................................... 8
STRATEGIES AND IDEAS FOR QWIKCILVER ............................................................................................. 8
FEW PROBLEMS ...................................................................................................................................... 9
GIFT CARD INDUSTRY IN OTHER COUNTRIES........................................................................................ 10
USA .................................................................................................................................................... 10
Finland............................................................................................................................................... 11
Sweden.............................................................................................................................................. 11
TransferWise ..................................................................................................................................... 11

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TITLE
QWIKCILVER GIFT CARD MARKET BASIC REPORT
Abstract
This report is a basic attempt to comment on the growing gift card market in India, while
also very briefly considering the global gift card market picture. QwikCilver the market
leader in the gift card market in India is also the backbone providing end to end solution
for the gift card industry. The industry shows phenomenal growth potential with expected
value of $ 1 Billion in the next few years. QwikCilver at this point also boasts a clear
majority market share in the industry. The report summarizes the various activities of
QwikCilver and its working dynamics with a brief emphasis also on its involvement in the
mobile wallet technology which is the spotlight of the gift card market at present. The
report is concluded with few strategies that could be applicable to QwikCilver and also the
gift card market prevalent in other countries is commented upon. Financial analysis and
internal affairs of the company are out of the scope of this report

GIFT CARD MARKET

The Gift cards market is blooming across the world and is considered a highly stable market
for the next decade. The closed loop gift card market (business specific and organization
specific gift card) is researched to be the most stable in nature. The other Gift card markets
like the open loop and semi closed loop markets are showing significant potential and rise
over the last few years. The USA alone boasts a humongous 134 billion $ market in 2015,
which is equal to twice the entire GDP of Nepal. The Gift cards trends which was historically
a lucrative market in developed countries, is now the present for many of big economic
powers like India and China. Smaller (Less populated but developed) European countries like
Finland and Sweden have their own Gift card markets of varying dynamics and trends. With
respect to India, not only is this market stable at present but also signals tremendous growth
potential especially with the changes in life styles of people and the increasing economic
inclusion of masses into the cities and semi cities. In countries like USA which have a well
developed and penetrated Gift card market, newer companies are emerging with modern
strategies to carve a market share. Example CardPool.com and Raise.com are developing
platforms for buying and selling of Gift cards online and to encourage the sharing mechanism
for this industry. The Indian Gift card market is comparatively newer, but it is safe to assume
that with time, innovation and light model oriented Gift card companies would emerge.
Discount and retail stores dominate the market at this point. With respect to customer
demographics, budget and card enthusiasts form the major base for the industry.

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Average Number of Gift Cards Purchased by Consumer Type (USA) [cardhub.com]

Brand Tamer

Card Enthusiast

Helpful Husbands

13%

Convenience

Last Resort

27%

16%
19%

25%

GIFT CARD MARKET IN INDIA

In India the Gift card market will have to consider the psychological aspects of the buyer with
great interest and emphasis. The Gifting market in India is currently valued at 3000 crore Rs,
and is expected to hit the 6000 crore Rs ($1 Billion) mark soon. The average per-personspend on gift cards is pegged at Rs 2,000. Technically, ItzCash the prepaid card giant and
QwikCilver the Gift card giant are targeting some similar markets with buyer psychology
being the key variable of determinant. Giftcards India with its 160 associated brands is also
making way into the Indian market. The gift-card market is currently being dominated by
physical cards used in offline retail which has led companies targeting mobile wallet and
open loop strategies for growth. Estimates do suggest intense interest in digital gift cards.
Almost 80 per cent of the current gift card market is corporate, but the consumer side of it is
picking up with pace. Overall the market is fairly stable and its imminent growth safe to
assume. Retailers such as Shoppers Stop, Spencer's Retail, Future Group and DLF Brands
have confirmed that gift cards and coupons increased 50% - 80 % during October-December,
2014 with both individuals and corporates preferring to buy cards for gifting.

QWIKCILVER
QwikCilver is a Bengaluru based company that provides gift card and prepaid stored value
card solutions to retail and corporate customers. QwikCilver specializes in delivering gifts
online and offline and provides backend tech-support for the gift card business of several
retailers. QwikCilvers website giftbig.com is India's largest marketplace for gift cards.
QwikCilver also is the gift platform provider for ecommerce giants Flipkart and Amazon.
QwikCilver as a company was registered in 2006 in Bangalore and over its effective

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operations since 2008, has shown 150% annual growth for six consecutive years. Primarily
funded by Helion Venture Partners and Accel Partners, QwikCilver is now attracting funding
from various directions including the minor percentage buy out by Amazon. Amazon has led
a $10-million (over Rs 60-crore) funding round in QwikCilver Solutions for a stake believed
to be just under 15%. The investment marks Amazon's maiden investment in India's start-up
ecosystem, having invested in over two dozen companies globally over the past decade.
QwikCilver also has about 90% share of the gift-card market in the India at the end of 2014.
For some of QwikCilvers clients, transactions through gift cards account for 10% -12% of
sales as compared to the industry average of 2%-3%

Brands
A client base of over 100 retailers and a 300-strong corporate customer base in India

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How It Works

Mobile

Browser

(balance, block &

activate through
sms)

(web interface)

Electronic Data
Capture
(Outlets through
CDMA, GPRS and LAN)
Issuing, Redeem,
Balance,
Deactivate

Telephone
(balance, block,
activate)

Internet

Transaction
(Multiple Programs)
Server

SQL Server (Transaction Rules)

Billing
Database

Data analysis,
Crystal reports

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QwikCilver Key features

Distribution

Linking brands to customers through multiple platforms and distribution retail outlets.
Branded Gift Cards & Prepaid Cards made available to your consumers through the various
distribution channels
Plastic Card Manufacturing

As part of our end-to-end solution offering, QwikCilver has we have partnered with card
manufacturers to cater for customers. The service adopts the following process and
ingenuities.
Suggestions with respect to choosing the right kind of cards
Designing the card
Card personalization
Offering at best possible rates without compromise on the quality
Analysis facilities also made available for the customers industry and consumer
requirements and help them evolve better card strategies.
Integration

QwikCilver platform provides an easy-to-use set of APIs for billing systems, web portals, and
other Point of sale (POS) systems to communicate with QwikCilver servers and process
transactions to integrate stored-value-card processing.
Analytics

The QwikCilver solution ships with a rich set of canned reports and provides the ability to
create custom reports within a short span of time. In addition, QwikCilver can work with its
partners or customer-preferred third-party vendors to provide analytics in the form of realtime dashboards and presentations. The solution runs on Microsoft SQL Server, enabling
easy integration with standard Microsoft products and most ETL tools and analytics engines.
Consumer Services

With QwikCilver platform, customers can deliver promotional messages through IVR
response, Receipt footers, SMS messages, and emails. Our customers can enable their endconsumers to check balances, track their transactions, deactivate cards through self-service
portals, which can be launched from the customer website.

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Mobile wallet
QwikCilver has secured a five-year prepaid mobile wallet license from RBI in 2014 along
with Mobikwik and Paytm for semi closed prepaid payment systems. The company is also
considering bringing out a single company branded gift card which could be used by
consumers across its client base.
Closed System Payment System

Semi Closed System Payment System

Generally issued by business establishments for use at

Redeemable at a group of clearly identified

merchant locations/ establishments. These
instruments do not permit cash withdrawal or
redemption by the holder.

their respective establishment only. These instruments

do not permit cash withdrawal or redemption

Semi Open System Payment System

Open System Payment System

Can be used for purchase of goods & services at any

Instruments which can be used for purchase of

goods and services and also permit cash
withdrawal at ATMs

card accepting merchant locations. These instruments

do not permit cash withdrawal or redemption

Possible suggestions for QwikCilver mobile wallet

EMI options would be a game changer
Tie up with a mobile operator in similar lines to Softcard (AT&T, Verizon) would
help in future strategies
Loading flexibility + bonus loads for high transaction customers
Exchange points for money (Tie up with Banks)
Add an optional layer of password along with VBV / OTP that Mobikwik is anyways
currently sticking to (Some people would prefer personalized security over ease and
time)

STRATEGIES AND IDEAS FOR QWIKCILVER

Target university student cards for tie ups: It is a very common practice in European
universities to be able to pay through student cards, and avail discounts that are coupled to
them. Considering tie-ups with major universities would be a big market.
Sharing concept: Discount and budget tamers comprise the major market share in the gift
cards industry. Sharing concept of gift cards is bound to pick up in a few years. Considering
the fact that millions of Rs worth of discounts and gifts go waste and unclaimed, sharing
concept is logical.

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Give more options: Currently one of the opposition to gift cards according to behavioural
economics is the limitation on the number of options that the gift cards entitle them to.
Improving the options by using market surveys would be worth a try.
Exchange gift/discount cards: Exchange platform for gift/discount cards would be helpful
in improving the give more options criteria. Somebody who is a regular user at PVR would
be more than happy to exchange his Flipkart card for his friends PVR card and vice versa.
Display loyalty and discount cards in shops: Most of the times vendors have the cards piled
up and stored in shelves. Displaying the cards more lavishly and strategically would help
psychologically imprint the choice
Gift out the cards, not ask: Give away the card as a gift along with another more physical or
utility product (example USB equipped card). Most of the times when given a choice people
choose not to take the card even if it is of importance to them, implying better selling tactics
for the cards!
Villages: The mobile wallet concept can be customized to tap into villages and secondary
cities market. Even if there isnt internet penetration at present in this market, access through
mobile phones are available. The Banking industry is also in the ascendency for this market,
which would help for potential tie ups. Microfinance concept should not be easily overlooked

FEW PROBLEMS
Although the industry is considered stable and with lucrative prospects, there have
been many articles and blogs emphasizing some of the limitations of gift cards.
According to CEB Tower Group more than $1 billion on gift cards goes unredeemed
annually in the USA. A matter that needs to be considered for the sake of the clients.
There have been certain doubts raised about the validity timelines for some gift cards
and if they really are good items to gift?
There have been questions raised about the interest and disinterest factors that are
associated with gift cards. Most of the times there isnt much advertising or exposure
about the gift cards after being issued. Very few customers reload gift cards!
Perceptually and through general consensus loyalty and discount cards are considered
less liquid than money

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GIFT CARD INDUSTRY IN OTHER COUNTRIES

USA
Has the biggest gift card market in the world with a $138 billion market. It is also the leading
market in terms of number of companies and types of gift card and discount cards industry.
Examples:
Gyft.com : One of the leading gift card companies currently emphasizing on digital markets
Cardpool.com : Creates platform to buy sell gift cards
Raise.com : Buying and selling gift cards
Thediscountcard.com : Specialized in manufacturing discount cards for small and specific
events like college events and sports events.
There has been a fair amount of research done on the psychological aspects of the customers
in USA. Cardhub.com had this data made available is 2012 about the customer perception.
Factors Likely to Influence Consumers to Purchase (USA)
Influencing Factor

2006

2007

2008

2009

2010

2011

2012

2013

Gift cards are easier and faster

to buy than traditional gifts

N/A

N/A

N/A

N/A

17.8% 19.4% 21.1%

22.6%

Gift cards allow the recipient to

select their own gift

N/A

N/A

N/A

N/A

45.8% 46.4% 44.7%

43.1%

Giving gift cards helps me stick

to my holiday budget

N/A

N/A

N/A

N/A

4.6%

4.8%

4.7%

5.7%

The gift recipient does not have

to worry about returning
merchandise

N/A

N/A

N/A

N/A

6.1%

6.0%

6.6%

6.0%

It is easier to mail/ship a gift

than a traditional gift to out-oftown gift recipients

N/A

N/A

N/A

N/A

6.7%

6.2%

5.8%

6.3%

Incentives for buying gift cards

(e.g. free additional gift card for
myself, discounts on fuel, etc.)

N/A

N/A

N/A

N/A

4.7%

5.5%

4.8%

4.9%

None of the above

N/A

N/A

N/A

N/A

14.2% 11.7% 12.3%

11.3%

Total

N/A

N/A

N/A

N/A

100.0% 100.0% 100.0%

100.0%

Source: Cardhub.com

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Factors Likely to Influence Consumers against Purchasing (USA)

Influencing Factor

2006

2007

2008

2009

2010

2011

2012

2013

Gift cards seem impersonal

N/A

N/A

N/A

N/A

24.1% 26.1% 24.1%

25.3%

Concern that the card would

expire or have added fees

N/A

N/A

N/A

N/A

18.9% 17.4% 15.8%

16.3%

Rather buy items on sale and

give traditional gifts to stretch
the dollar further

N/A

N/A

N/A

N/A

8.9%

9.1%

8.9%

9.7%

Worried the recipient will lose

it or never spend it

N/A

N/A

N/A

N/A

5.9%

5.9%

6.4%

6.6%

Concerned that the retailer will

go out of business

N/A

N/A

N/A

N/A

3.2%

2.9%

2.2%

2.1%

Not sure which company a

person would want a card from

N/A

N/A

N/A

N/A

9.5%

9.7%

9.3%

9.4%

None of the above

N/A

N/A

N/A

N/A

29.6% 28.8% 33.3%

30.6%

Total

N/A

N/A

N/A

N/A

100.0% 100.0% 100.0%

100.0%

Source: Cardhub.com

Finland
Perfect Finnish is one of the companies associated with gift cards. The gift items are highly
predefined and limited in terms of options. Store specific discount and loyalty cards have a
bigger market in Finland like Stockmann stores.

Sweden
The companies in Sweden are primarily innovation and technology based. Wrapp links an
existing or a new credit card or a customized card to the Wrapp mobile app. (By taking
charge of your transaction data and choose to let brands see your purchase power, you invite
brands to bid for your every purchase. The end result is a smarter, more convenient and more
rewarding shopping experience.)

TransferWise
A tie up with innovative companies like TransferWise would help globalize the QwikCilver
Gift card market to enable the international gifting market space.
How TransferWise works

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From the customer's point of view, money transfers with Transferwise are not essentially
different from conventional money transfers. The difference lies in how TransferWise routes
the payment. Instead of transferring the sender's money directly to the recipient, it is
redirected to the recipient of an equivalent transfer going in the opposite direction. Likewise,
the recipient of the transfer receives a payment not from the sender initiating the transfer, but
from the sender of the equivalent transfer. This process avoids costly currency conversion
and transfers crossing borders.

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References
http://www.moneycontrol.com/news/cnbc-tv18-comments/hope-to-clock-revenuesrs-1000-crthis-year-qwikcilver_1242322.html
http://timesofindia.indiatimes.com/tech/tech-news/Amazon-joins-India-startup-story-backsgift-cards-company/articleshow/45623903.cms
http://www.companywiki.in/wiki/qwikcilver-solutions-private-limited.html
http://www.medianama.com/2014/11/223-qwikcilver-amazon-india/
http://www.marketwatch.com/story/1-billion-in-gift-cards-go-unredeemed-2013-11-27
http://www.qwikcilver.com/services.html
http://www.cardcash.com/gift-card-statistics
http://www.cardhub.com/edu/gift-card-market-size/
http://articles.economictimes.indiatimes.com/2014-01-03/news/45837098_1_gift-cardsindiatimes-shopping-shoppers-stop
http://en.wikipedia.org/wiki/Prepaid_Payment_Instruments_in_India
1.
2.
3.
4.
5.
6.
7.
8.
9.

SoftCard
Google Wallet
Mobikwik
Paytm
TransferWise
Sharesomenet
Wrapp app
Cardpool.com
Raise.com

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