As a former small business owner, Gillian McCrae knew the challenges local merchants face attracting customers and getting a return on their marketing dollars.

The Charlottetown native pondered the problem and came up with a unique solution — merchants could attract customers and build loyalty by offering them gifts.

McCrae launched the idea on Prince Edward Island and it immediately appealed to consumers and merchants. GetGifted was born and now, one year after its launch, the company is expanding across the region and into major North American cities.

Here’s how it works: GetGifted asks local retailers to offer gifts to local consumers. The merchant chooses the type of gift and how many they want to offer. It could be a $15 gift to a local restaurant, a month membership to a fitness centre or a round of golf. The merchants and their gifts are then featured on #TheGiftList, an email that is sent to local consumers that have signed up for free with GetGifted.

The email blast comes at a different time each Tuesday and consumers can claim one gift. They then have 14 days to redeem their gift in-store using their smartphone. Merchants pay an annual fee of $2,000 to be featured once a month on #TheGiftList. More than 80 per cent of merchants say that sales they make from GetGifted customers greatly exceed the cost of the gifts.

“Around 10,000 people subscribe to the weekly gift-giveaway on P.E.I., 85 per cent of them from Charlottetown, that’s almost one-quarter of Charlottetown’s population,” McCrae said. “About 150 merchants in P.E.I. have joined GetGifted and we typically offer around 1,500 gifts each week. All the gifts are claimed within 10 minutes, and about 60 percent of them are redeemed in the two-week period.”

Last fall, McCrae and the GetGifted team decided to launch in New Brunswick, landing in Fredericton and Saint John. In December, the team entered Halifax, Atlantic Canada’s largest metro area. They will launch in Moncton and Toronto in the coming months, and in their first American city, Boston, later in 2014.

McCrae learned how challenging it can be operating a small business while running her own restaurant in Ontario. After moving home to Charlottetown to study business and accounting, she found herself working for local businesses as a consultant.

“I realized that the merchants were having trouble advertising effectively and building their social media. It occurred to me that they could try giving away gift cards, so I offered to give them away on Twitter. I’d never used Twitter before, but I was curious and I committed 30 days to the project.

“It took off and I found myself giving out dozens of gift cards every week. I was doing it for free, paying for envelopes and stamps and I thought, ‘We need an app for this.’ A friend of mine is a web developer and he built the prototype. Three months later, we created GetGifted.”

In Halifax, the idea caught on as soon as it was launched.

“GetGifted has provided an excellent tool that works for both sides of the retail experience,” said Nancy Tissington, executive director of the Spring Garden Area Business Association.

Medium- to high-end businesses in each market are featured.

“It’s not about getting a deal or discount, it’s about merchants gifting to create an experience,” said McCrae, who acts as the company’s CEO and founder.

Professional people aged 25-45 are the target audience, and Twitter remains a key tool for reaching them. Many followers publicly thank merchants on Twitter for their gifts, thus providing merchants with extra exposure.

“The Tuesday unveiling of #TheGiftList is keenly awaited by consumers. We have turned Tuesdays into a community event,” McRae said, adding that she is currently fundraising for funds to fuel the company’s expansion into other markets.