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Facebook Begins to Test Digital 'Gifts With Benefits'


Elaine Wong


June 13, 2008

Facebook gifts used to be graphical images of a Ben & Jerry's ice cream cone or Sunkist soda that users could send their friends with a quirky message. But now the popular gifting application will let brand marketers create online gifts with real-world value.

Brand Networks, Boston, has introduced a platform that lets Facebook users send coupon codes and sample offers to their friends. Dubbed "Gifts with Benefits," the application kicks off with a beta launch next month.

During the initial test, a pool of Facebook users will be randomly selected to use the application and submit their feedback. From there, the program will spread virally, allowing users to pass along 10% to 20% discounts for select products. Continuing with the benefits theme, 1% of the revenue generated will go to the nonprofit alliance One Percent for the Planet. Facebook will run a series of promotional ads in August to promote the new program.

After closely tracking the Facebook gifting phenomenon for six months, Brand Networks CEO Jamie Tedford estimated there will be 200 million virtual gifts given via Facebook in the next year: "That, to us, felt like a real business opportunity." As part of the partnership, Brand Networks retains a 3-7% share of affiliates' sales.

One of the first major advertisers to sign on was Student Advantage, which runs the nation's largest college discount program. (The company offers deals at stores including Target, Armani Exchange and Urban Outfitters.)
Student Advantage hopes to have 15 of its retail members on board for the August commercial launch, which coincides with back-to-school shopping month.

"In marketing to college students, we wanted to make sure we market through every channel that's optimal to reach them. And we're confident this will be a success," said Student Advantage senior marketing manager Ari Parnes. "Instead of having to pay for a certain number of impressions, we're relying on the nature of the [viral] environment to really propagate it."

Ian Schafer, CEO of Deep Focus, New York, an interactive media agency, said the Gifts with Benefits concept is one example of an ongoing social network marketing trend: "What's interesting is the fact that as new applications get developed for Facebook, [then] marketers develop successful platforms on top of [them]," he said.




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