An Irish greeting card app company, which utilises social media to connect to as many as 50m people across the world, is aiming at €250m gross profit within five years, writes Trish Dromey.
Using technology and social media to create a greeting card for the 21st century, Dublin company Cleverbug has set out to disrupt the $27 billion (€19.5bn) global greeting card market.
The CleverCards app launched last year, allows users to quickly and easily select auto-created, ready- made real (printed), photo -personalised greeting cards from their app, with CleverCards individually printing and & delivering them locally anywhere in the world, for €3.45.
Company founder and chief executive Kealan Lennon says this app successfully combines the latest technology with the traditional card which arrives in the post.
“It uses social media, (the app can be linked to Facebook to source photos and information on birthdays) as well as mobile technology and ecommerce and creates user-generated content which is something which people engage with,’’ says Mr Lennon, who claims the key difference between CleverCard and other websites offering cards is the fact that it is operating on a global scale.
“We have the largest printing and logistics infrastructure of any greeting card in the world,” he says, explaining that the company has secured the services of 76 printing facilities around the world to ensure quick local delivery of cards.
He says CleverCards is also the only app which links to Facebook so that it can generate reminders of birthdays and anniversaries and provide a source for photos.
The company estimates that the users who have signed up over the last year have connected it to 50 million people globally by linking to all their family and friends.
“We have sent printed cards to recipients in over 150 countries,’’ says Mr Lennon, and more than 15m people per month see CleverCards on their Facebook newsfeeds.
Based in Ranelagh, the start-up company, set up in 2011, has recently raised €4.4 million in funding and is set for expansion. Mr Lennon is formulating ambitious plans for future growth.
“We have a revenue model and gross profit model in place. Making $2 gross profit on every $2.99 sale, I believe we can get to €250m gross profit on $375 million revenue in five years.
“My vision is to build the largest social gifting company in the world, becoming bigger than Hallmark and drive Cleverbug to a $1bn initial public offering.”
Mr Lennon has a track record in the design, print and publishing space, having sold his first company for $20m to global giant MeadWestvaco.
Looking for an idea for a new business, he observed the changes that technology had brought to the music, DVD and gaming industries and saw opportunities for photo content.
“I looked at the exploding growth of ecommerce, Facebook and mobile technology and decided to find something which would use all of these. Looking at photo content led me to look at greeting cards. The industry hadn’t changed in over 100 years and seemed ripe for disruption.”
Researching the industry, he raised $2m venture capital investment in November 2011.
“Starting with mobile app developers and graphic designers, I began to build up a team and also to build up a network of printers. I also spent two years creating engagement with Facebook,” he adds.
The company launched its app to mobile customers last spring.
“We started with an iphone app for birthday cards; now we have over 100 categories of cards and the app is available on all devices.”
The company has gained most traction in the US, which accounts for 62% of sales. Mr Lennon says the company is now producing 4,000 cards a day and the business is growing as people who receive cards go on to send CleverCards to their friends. Search engine optimisation is also a major focus and the aim is to ensure that the company is in the top three market positions in the app store for card app searches.
Cleverbug now employs a staff of 20 and plans to take on an additional 25 over the next year.
The recently raised funding is to be used to expand the product range and grow its user base, particularly in the US.
The goal is to have 5m customers within five years, but Mr Lennon’s ambitions do not end there and he sees further opportunities to “disrupt the gifts market”.
“Moving beyond the cards market, gifts are the next obvious step and part of my vision is to build the largest social gifting business in the world.”
One option being looked at by Cleverbug is to raise substantial funding in order to scale the business globally faster.
As the business develops there is a possibility of it disrupting traditional trends in the greeting card market, which according to Mr Lennon sees 85% of all cards being bought by women.
“Men discover they can buy cards online and don’t have to go to a shop to look for one or go to the post office to send it — they might well start buying more cards.”
© Irish Examiner Ltd. All rights reserved