The Cashback Conundrum
Going back a few years, e-commerce websites struggled to make shoppers pay online, as most of us loved to pay cash on delivery. Evidently, the demonetization event in 2016 gave the market an incremental push. Consumers are more comfortable paying online; start-ups like Paytm have undeniably contributed to that. You don’t need to carry a card everywhere to make a cashless payment. Small shopkeepers are glad to receive a payment through mobile wallets and customers are happy to get a cashback on their purchase.
Going back a few years, e-commerce websites struggled to make shoppers pay online, as most of us loved to pay cash on delivery. Evidently, the demonetization event in 2016 gave the market an incremental push. Consumers are more comfortable paying online; start-ups like Paytm have undeniably contributed to that. You don’t need to carry a card everywhere to make a cashless payment. Small shopkeepers are glad to receive a payment through mobile wallets and customers are happy to get a cashback on their purchase.
E-commerce websites pamper consumers like you and me, with huge discounts and festive sales year after year. Now you may wonder why so much cash is given back to the consumer and what are the ways with which you can you earn when you shop. Let’s look into some key factors at play.
SUBVENTION Subvention is nothing but rolling out money for a purpose. Heavy discounts & cash rewards are generally given by keeping a set amount of money to be rolled out as cashback or discounts. Flipkart is one of the top shopping websites in the country. They give their customers Flipkart Cashback rewards when transacting with major credit or debit cards. Assuming that the cash reward is 10% of the price, the retailer & the bank split & finance your cash reward. They roll out Some like Paytm & Amazon have their own online moneywebsites to generate more business. wallets, which the customers can use to make a transaction, in such cases; online retailers don’t have to share a cut with the bank. This gives them control over the amount of cash reward they want to disperse.
CUSTOMER LOYALTY Giving out deals & cash rewards helps retailers & banks achieve their quota of sales, & give them a foothold to stay relevant in the marketplace. competitive The main purpose is to buy customer loyalty & customer retention. However, the current market in the country is rampant with deals & discounts. With such a commercial environment we tend to act like kids, our attention moves from one discount to the next. Now how can we save more on our shopping, you might wonder;
ONSITE CASH REWARDS Onsite cash rewards.
You can connect your Paytm wallet with most other apps to make a payment and get cash rewards. For example, Uber’s newly launched service Ubereats lets you make a payment through Paytm for food deliveries. Amazon has launched its online wallet called Amazon pay & you get you get an instant 15% cashback when you transact through it. Online offers keep changing with the
THIRD PARTY CASH REWARDS Amazon is said to have widely popularized affiliate marketing, where a third party website or app can drive sales to an online retailer and in turn, take a cut of the sale. A lot of popular websites like cashkaro.com, xerve.in & are tied up with Amazon & Flipkart. These affiliate marketers share a cut of their profit with their customers to This cycle of spending and earning rewards is what drives maximum again achieve customer loyalty & sales to the retailers with the help of financiers like the banks. The sales. customer is happy that he got a discount; meanwhile, the retailer enjoys a higher number of sales.