What is the Cashback Reward Programme and How Does It Work?

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Cashback is a technique that allows consumers to earn money when shopping online. Depending on the cashback programme and the merchant, consumers can get an average of 1% to 15% of their spend back. This technique has become increasingly popular in recent years, with e-commerce sites offering their own cashback programmes to their customers. Cashback programmes, which are very common in English-speaking countries, are becoming increasingly popular worldwide. Cashback programmes are therefore a good marketing technique to attract internet users.

What is Cashback?

Cashback is the process of getting back some of the money you spend on the internet. In other words, it is a technique that allows the online shopper to be reimbursed for some of the money spent on an online purchase. Although it is confused with promotions, they are actually different from each other. If a discount is made when the customer purchases the product or service, this is a promotion. However, if the customer buys the product or service directly at the price they see and then part of the price you pay is refunded, this is a cashback programme.

Cashback is a very interesting technique for e-commerce sites as it is a ‘win-win’ for consumers and merchants. Consumers can save money on their online purchases and merchants can reach new customers while at the same time increasing sales and building loyalty. As a result, many brands have rethought their customer loyalty techniques and programmes, integrated cashback rewards programmes into their marketing techniques and are ahead of their competitors.

How is Cashback calculated?

The calculation is quite simple. For example, if you buy a product for a total of 100 TL and the seller offers 10% cashback from the amount you paid, it means that 10 TL money will be returned. So the bigger the purchase, the higher the cashback you will get back.

Cashback Advantages and Disadvantages for Merchants

As you can understand, consumers who frequently shop online can benefit from advantageous discounts, but what are the advantages and disadvantages of sellers in this case?

Advantages

  • It allows you to reach a wider target and acquire new customers.
  • Increases your visibility and recognition.
  • It allows you to better understand the buying habits of customers.
  • Increases sales and traffic on your e-commerce site.
  • It enables its customers to increase their average basket.
  • Increases the frequency of customer purchases.
  • It allows you to create customer loyalty.
  • It allows you to strengthen consumer confidence.

Disadvantages

  • The cashback technique has not yet been fully integrated into the purchasing habits of internet users.
  • Cashback offers cannot be personalised.

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