How Govalo is Reinventing the Digital Gifting Experience with Founder and CEO Rhian Beutler

Gifting is stuck in the past. Discover how Rhian Beutler and the Govalo team are reinventing the digital gifting experience for Shopify merchants.
May 27, 2022
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Yellow background with the Tydo logo and Govalo logo and blue text that says "Reinventing Digital Gifting"

How Govalo is Reinventing the Digital Gifting Experience with Founder and CEO Rhian Beutler 

Gifting is stuck in the past. Most consumers have a pile of printed gift cards or physical cards sitting at the bottom of their junk drawer, only to forget about them each time they head to the store. On the brand side, gifting is an all-around clunky experience. Most Shopify merchants either don’t offer gift cards or use slow, bulky solutions. 

With all this in mind, the prepaid card market is growing. It surpassed $2 trillion in 2020, according to Global Industry Analysts, and the market is expected to top $4.1 trillion by 2027. 

Why is the digital gifting experience so lackluster? Why don’t people use gift cards? Why stop there? 

We sat down with Rhian Beutler, Founder and CEO of Govalo, to answer those questions. Working with Baboon to the Moon, Curie, and Felix Gray, Govalo helps merchants create customizable gift cards and easily offer store credit. 

“I’m all about flexing our understanding of gift cards. They’re super outdated. Why do we have to accept them as status quo?” 

Collaboration Over Competition

This isn’t Beutler’s first rodeo in the Shopify ecosystem. In addition to founding Govalo, she cofounded venntov, a SaaS company that creates Shopify apps, including SEO Manager, ClockedIn, and Order Lookup

When Beutler started venntov, she bootstrapped the agency by consulting. At the time, there weren’t venture funds supporting Shopify tools. Funds couldn’t understand why people were building platforms on top of Shopify. So, she consulted until venntov’s SaaS apps started making money. Fast forward to today, Beutler is now the executive chairman of venntov and works full-time on Govalo. 

Beutler’s main takeaway from running venntov: “Collaboration over competition.” 

Beutler notes how important relationships are in the Shopify ecosystem and prides herself on creating authentic relationships. She says, “I don’t think you should ever walk into a relationship thinking, ‘What can you do for me?’ You should always walk into a relationship thinking, ‘What can I do for you?’” 

All those authentic relationships have led to lifelong friendships and partnerships that have helped Beutler build Govalo. Now, Govalo is shipping new integrations in collaboration with apps like Tydo, Bold Commerce, and more. 

“Collaboration over competition. We can all win together. The pie is big enough for all of us.” 

Tapping into the Digital Gifting Market 

Where did the idea for Govalo come from? In April 2021, Beutler tried to buy a present for a friend. She bought a gift card from a brand that used the native Shopify gift card tool, and it was a clunky, unpleasant experience. Beutler wondered why no one was innovating in the gift card space. 

So, she and her cofounder Kelly Vaughn set out to disrupt digital gifting in May 2021. 

It was the right time to enter the market. The number of digital cards U.S. retailers sold in November 2020 increased 25% YOY and increased 106% YOY in December 2020, per survey data. Plus, the gift card market wasn’t penetrated yet. 

Why? It’s hard to nail gifting. 

To win, “you have to understand gifting, financial services, and retail. In our industry, it’s very rare to find a team that understands all three of those things,” says Beutler. Luckily, she had all three experiences in her back pocket as well as Kelly’s engineering expertise to build Govalo. 

To put it simply, “Govalo allows Shopify merchants to send gift cards on their terms,” explains Beutler. That way, customers can send gift cards to people they love on a specific day, at a specific time. Plus, Govalo integrates with Klaviyo, Omnisend, Drip, and Bold Commerce. A Recharge integration is in the works. 

One of the biggest challenges with gift cards is that people don’t use them, which means: 
  1. If someone gives a gift card to someone at a store they don’t like, they won’t spend it. 
  1. If people don’t receive reminders about their gift card, they will forget about it.

That’s a clear opportunity for Govalo—remind people to use gift cards or even gift subscriptions. But, it doesn’t stop there. Beutler doesn’t believe that gifting stops at gift cards. Govalo recently released giftable subscriptions in conjunction with Bold Commerce. 

“There’s something to be said about building with your heart, knowing what people need and want, understanding user behavior.” 

The Digital Gifting Trifecta: Fintech, Ecommerce, and Retail

Fintech, ecommerce, and retail all intersect in the gifting world. 

Within fintech, there are tons of players in the gift card space—mostly ones who service big-box stores. No one services the SMB market (aka an opportunity for Govalo). 

Plus, no one’s touching the ecommerce aspect of gifting. Most people see gift cards as impersonal. A gift card is the classic“I don’t know what to get you. Get anything you want” gift. 

But, sending a gift card from a Shopify store is very personal, notes Beutler. It says, “Hey, I understand who you are as a person. I know the kind of things you like. I want you to choose a gift for yourself.” For example, a gift card to The Sill says, “I know you like plants. I don’t know what plant you want because I don’t know the light situation in your apartment, but I’m going to send you a gift that will brighten up your room.” 

In terms of the retail side, there’s a big disconnect between ecommerce and brick and mortar. Govalo is closing that gap by creating a continuous gifting experience. They also give merchants the option to offer store credit. 

Right now, there’s not a convenient way for merchants to offer store credit on Shopify. “Normally, people just give gift cards for store credit, so we pulled them out. We do both, but they’re separate because they function differently inside of a business,” explains Beutler. 

“There’s a big disconnect between offline and online. That’s part of our goal: to create a continuous experience, no matter where you shop.” 

Gift Cards Over Discount Codes 

Gift cards are a powerful tool for building loyalty and retention. Beutler says, “Let’s say it’s your birthday and you’re a loyal customer of mine. Most people would send a $10 discount code in that situation, but I would send you a $10 gift card.”

At Govalo, they’ve A/B tested gift cards vs. discount codes, and gift cards always convert better. 

The AOV for Govalo is $75 over the average Shopify gift card amount. In Govalo, merchants can see how much revenue has been generated by gift cards, how many gift cards they’ve sold, their AOV with gift cards, as well as how many gift cards have been redeemed. The same data is available for store credit too. 

Recently, a Govalo merchant put their gift cards on sale for 50% off. So, a $100 gift card became a $200 gift card. They did 10,000 dollars in gift card sales in 12 hours, says Beutler. 

Instead of offering a discount code right out of the gate, Beutler recommends offering a gift card. The value proposition changes the consumer’s mindset. 

For example, “I love Kate Spade. Every three weeks, they have a major sale, so I never pay full price because I know it’s all going to go on sale. You don’t want customers to always assume you’re a discount brand,” notes Beutler. 

What’s the opposite of a sale? A gift. 

Another interesting use case: seeding gift cards instead of products. One Govalo merchant seeded gift cards instead of discount codes and found that they converted much better. “That’s because you get a dopamine hit when you get a gift,” adds Beutler. 

In Govalo, there’s an option to update gift cards dynamically. In that case, the gift card almost acts as an influencer credit card.“Imagine you work with D1 athletes. Do you want to risk sending a product to a D1 athlete when you don’t know their size, preferences, and food allergies?” notes Beutler. 

“There’s a difference between being a discount brand and a value-add brand. Be a value-add brand.” 

Supply Chain Challenges? Look No Further Than Gift Cards

Beutler is fascinated by supply chain economics. Believe it or not, the supply chain is worse than it was before the holiday. “We’re just not hearing about it because people’s buying habits aren’t as high as they were before the holiday season,” explains Beutler. 

China is still pursuing a zero-Covid policy. There are hundreds of boats sitting outside of Shanghai and other port cities. Additionally, Mariupol, a major Ukrainian port, is under siege. All of these factors impact the supply chain. 

To make matters even worse, Walmart, Target, and other big-box names bought boats and airplanes to ship their products. What’s the impact? Now, it’s even more expensive to get product from overseas. Pair that with inflation and the labor shortage, and let’s just say it’s not the best economic environment for DTC brands. 

One solution? Offer gift cards with Govalo. They even have an out-of-stock integration that says, “This product is out of stock. Buy a gift card instead.” 

What can this do for merchants? It helps with cash flow. Even though gift cards can be seen as a liability, they provide access to instant cash flow. 

“This is a cashflow dominant industry. If we’re not making money, we don’t have a business. So, folks need to make money, even if they don’t have things in stock. Gift cards are one way to do that.” 
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