Sometimes it's smart to be dumb

eVoucher has found a sweet niche that generates revenue by cooperating with bricks-and-mortar businesses instead of competing with them. Its revenues flow from online sales of gift vouchers that can only be redeemed by using them in traditional stores.

Gandel Retail Group is the latest establishment heavyweight to give eVoucher's model a tick of approval by signing up for its services. Gandel's decision has added piquancy because it comes only weeks after fellow shopping mall magnate, Westfield Holdings, called off a $5 million online mall project. eVoucher's low-risk, softly-softly approach has seen its business expand quietly but steadily over the past 18 months, says CEO Gary Berger. It now has 100 brands on board, of which the vast majority are national retailers such as Freedom Furniture and discount chain Big W, but which also includes luxury boutique hotel Peppers.

Basically, eVoucher outsources provision of an e-commerce channel that slots painlessly into traditional business models. "Retailers love us because we complement their business," says Berger.

With no physical stock on its shelves, eVoucher avoids fulfilment and delivery issues, which have dogged the e-tail industry. Its gift vouchers - typically worth around $70 - are delivered via snail mail or email. When a customer takes one into a bricks-and-mortar retailer, the transaction is authorised by a phone call to eVoucher's automated voice-prompt system, which validates the voucher and generates a payment from the retailer to eVoucher.

The Gandel deal also calls for eVoucher's technology to be installed on the websites of the 10 individual shopping centres in the group but Gandel has no plans to launch its own online transaction services.

"eVoucher's instant e-commerce facility has the potential to generate significant incremental turnover for our centres," says Gandel marketing manager Karmen Doran.

On the consumer side, Australian residents sending gifts to family members in the same or other cities and expats buying presents for the folks back home are the bulk of eVoucher's users.

However, the fastest growth lies in corporate sales to enterprises that use gift vouchers in sales-incentive and customer-reward programs.

Privately-held eVoucher has a staff of 15 and its board is headed by Brett Blundy, managing director of Brazin Ltd, which owns the Sanity music store chain.

Courtesy of The Australian Industry Standard, http://www.thestandard.com.au

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