Launching on 25 November at Giffgaff.com, it will ask members to produce content to help spread word of mouth in return for free UK mobile calls, texts and mobile internet for a year.
The launch campaign is based on a free ‘tool hire' concept, whereby a series of eccentric marketing tools including a ‘cuddle monster suit' will be available for free hire by the public at giffgaff.com/tools.
People who upload videos of themselves using the tools to YouTube have the potential to get rewarded with free mobile credits.
There are 12 tools for hire including a giffgaff cuddle monster big enough for five people to wear and hand out warming hugs; a bicycle which powers a gramophone and a speechless karaoke busker that allows members of the public to call in and sing on loud speaker.
The Tool Hire videos will also be used virally to support the launch and the five best videos will each receive a cash prize of £5,000 each.
Albion is behind the brand strategy and planning.
Giffgaff will use O2's network but will not highlight the O2 brand. The business is being run from Beckensfield by CEO Mike Fairman, formerly head of broadband at O2.
Giffgaff, which means ‘to give and receive', will operate with a low cost base, and offers a fixed rate SIM only tariff and a range of online tools to allow members to suggest answers to each other's questions in online user groups.