The Benefits of cashback shopping

Though receiving cash back on expenses is by no means a new phenomenon (the 1980’s first introduced the concept of rewarding customers with low interest on their credit cards and a percentage of the annual spend redeemed back in cash), the rise in expectation to deliver new incentives has risen dramatically ever since, and businesses are battling to take the lead in the race to win new custom.

With cheaper and more efficient internet packages such as Broadband becoming more popular in the home, shopping has never been made easier for the consumer. With the freedom to purchase from their own homes and with a much wider market offering highly competitive prices on goods, the pressure on the retailer has called for new incentives. Home delivery means that people no longer even have to leave their own home which in itself has become a catalyst for businesses to stay one step ahead and create new marketing programs that will retain and improve their success.

With the gates wide open for retailers from all over the world to advertise their products, gaining customer attention has become a business all in its own. For the customer, the rise in internet advertising has presented the problem of choice, and so two new kinds of websites have been developed to assist in finding the best products at the most competitive prices.

The first are ‘Price comparison websites’ which literally do as they sound. They can find the best value-for-money on specific products in an instant, narrowing the choice for the customer and making a convenient time-saving product. Essentially these are advertising sites that take a profit form retailers who pay a fee to have an affiliate link attached to the website that leads the customer directly to their business. Because comparison websites rely on the marketing funds from retailers, they are of course vulnerable to advertising those sites which may not necessarily offer the best deal so it could be argued that these sites are already becoming slightly redundant at an early age.

Enter the cashback website
The second of the new type of website that first appeared only a few years ago, are known as ‘cash back websites’. They work on the same premise as the comparison sites in how they make their money – usually through taking a small percentage of the customer spend or a percentage of what the retailer has paid to advertise – but the biggest benefit they offer is that they return part of their profits to the customers themselves. Because it is often cheaper to advertise online, not just in terms of marketing but there are of course lower costs involved with labour, and with the rise in competition, retailers are encouraged to offer the most competitive deals in a wider market like the internet to encourage new customers and loyalty from their regular ones.

Principal cashback benefits
The benefits for the customer are extensive in that there are usually no joining fees, they are introduced to cheaper prices on the goods that they want, but have the added bonus of being able to earn points or cash back the more they spend; some of the more reputable cashback sites will even offer a welcome bonus giving a guaranteed sum of cashback credit. Cashback club also offers a £5 bonus for those members who introduce family or friends, so the credit can add up before you even make a purchase. Naturally these benefits can be doubled if the customer uses a cash back credit card to pay for their wares; though it is of course advisable that they keep on top of payments and pay the monthly balance off in full in order to gain more money and get a better credit history.

Cash back websites tend not to stick to one kind of product, but rather offer the widest variety possible in the range of goods and incentives. With over a thousand retailers signing up to offer competitive deals for customers, many of them offering competitive deals that they wouldn’t on the high street, the savings can be great and make a huge difference, but it is worth looking into the types of discounts available to find the best bargains.

Cashback examples
A typical offer on a mobile phone from several of the larger retailers might fall into a flat rate discount such as receiving £45 cash back on a contract mobile in addition to any cashback the retailers might offer as a package with the network. As many contract phones tend to wave fees on the handset and make money on the contract rates, a customer on a cash back site can be assured that they are going to receive £45 cash back at the end of the time period set. One mobile phone company offers a flat rate of £17.50 back on any phone, so a phone that costs £105.00 will be available at a reduced rate of just £87.50.

Cashback points work in a similar way to some of the large retailer loyalty cards such as Sainsbury’s Nectar or Tesco’s clubcard; the main difference however is that these loyalty cards restrict the user to their own products where as a cashback website offers a variety of rewards from a variety of retailers allowing the customer to shop around and get the best discount deals available.

The variety of offers is extensive but there may be some research required from those money savvy people who want to ensure the very best of deals on the product they are looking for. For example, when comparing the cost of the same DVD from a number of retailers, one offered the product at a cost of £17.99 with 3.5% cashback through the Cashback Club website, whilst another retailer sold the same DVD at a cost of £15.99 with 2% cashback. Though the difference is minimal, it can make a big difference and the cashback soon adds up.

When a member has started to collect their points, they can receive their credit back in a one off payment, usually receiving a cheque or payment through BACS (bank transfer), but there are other ways of receiving credit too. In addition to cashback being offered, Cashback Club provides members with vouchers to be used at retailers and free discount codes.

It would be easy to assume that with such great offers available, that there might be a catch to these cashback websites – but they really are legitimate. Essentially they are a being productive in helping the consumer to get the best prices as retailers are pressured to match rates of their competitors.

WINKI DIRECTORY

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Cashback – How it works

Despite the twenty-first century being an era where people seem to have more of a disposable income and access to low interest credit, a fickle economy with fluctuating house prices and higher taxes means that people are a little more cautious about parting with their hard earned cash than they ever were. For retailers, the competition for business is fierce and as we enter an age where people readily have access to the internet at home thanks to competitive internet packages, the choices in available products has grown at an almighty pace.

With the internet making the shopping experience more convenient in terms of variety and cost, businesses have had to take note of the fact that the high streets are beginning to look deserted; the future in marketing, it would seem, rests in the hands of the World Wide Web. But advertisement alone will not attract a loyal customer network, in fact, getting noticed at all can be a near impossible task given rise to the access people have to world-wide retailers.

Price comparison versus cashback sites
Customers are able to search thoroughly for competitive prices so the pressure on retails to achieve is high. Whilst a price comparison website can be useful – these sites search specifically for a required product and list those websites with the most ‘hits’ and best value-for-money offers – they are also vulnerable to those retailers willing to pay a high reward for advertising their products through these affiliate links. Though not necessarily a new phenomenon, cash-back websites have started to gain more interest from those consumers wanting the best deals available on the internet.

Cash back websites offer financial rewards for their customers, primarily in the hope of attracting loyalty. Essentially they act as advertisers: retailers offer financial rewards to these sites in exchange for advertising space. The difference between these and the comparative sites however, is that cash back sites do exactly as the name suggests, they offer a financial return for the customer, usually at a percentage of their total spend or at a flat rate determined by the retailer. In short, the customer gets a portion of their money back when they spend online, and cash back websites not only direct you to the sites with the most compatible offers, but they establish a personal rewards program; the more you spend and save, the more cash back potential.

Cashback - tangible rewards
It would be easy to be suspicious of any website that claims to give free money but the rewards are genuine. To fully understand how these sites work, it is important to acknowledge that businesses can easily trace the direction from which their internet customers came. When we click on a link that leads us directly to a retailer’s website, the retailer can determine which of their affiliate sites, i.e. their advertisers, have been successful in directing customers their way. The cash back sites may be rewarded with either a flat rate or a percentage of that customer’s total spend and then the cash back sites return this to the customer after taking a small percentage for themselves.

In most cases customers can sign up with a cash back website for free and after being introduced to the sites they wish to purchase from, they retain the customers’ cash back reward for a set period of time (for example, they may keep the balance for three months and then release these funds back to the customer in one go after this time lapses). This ensures customer loyalty and therefore potentially more money but there are no hidden agendas, the cash back websites are merely returning the savings on cost. Many cash back websites reward their customers for introducing family and friends and this too can push up the cash back rewards significantly.

For those wondering why a product may be cheaper online than on the high-street, then it should be noted that depending on where the products come from (some retailers may be saving on certain taxes by selling online), the cost of marketing on the internet is far cheaper than say television or radio advertisements or the kind of product placements you might expect to find when walking along the high street or stuck to the side of a bus. With lower labour and administration costs, the retailer can afford to sell at a lower price and know that they must try to give back as much as possible with the threat of such strong competition; and research compiled by one of the UK’s largest cash back websites confirmed that these loyalty-based websites can be just as beneficial for the retailers.

Cashback - a win-win for consumer and retailer
Research from various networks, advertisers and retailers analysed the performance indicators of those customers who had reached the retailer through an affiliate site rather than a general web-search. Measured on an ‘Earnings per click’ scale, the results show that visitors are more likely to spend when given good incentives. One major high street clothing company saw an uplift of 183% whilst a widely known brand of pharmacy showed an uplift of 208%.

The savings available can vary dramatically and be on almost any product. Where as the latest DVD my cost £15.99 on the high street, online sales can be reduced by up to £12.99, sold and delivered directly to the customer who has essentially made a saving of £3 or 14%, and can expect to get an average cash back reward of anywhere between 50 pence and £3. Though this may not sound a lot, remember that the savings can add up and the cash back rewards can be doubled if a customer pays with a cash back credit card.

The cash back rewards on products like mobile phones can be much bigger: The Cashback club for example, offers rewards between £3 and £40 cash back, and £5 and £45 cash back on home insurance.

When earnings have reached a set amount dictated by the cash back websites, a request for payment can be made and the customer will usually be paid via BACS (bank transfer) or might even be given the option of being paid in vouchers.

Cash back websites are becoming an integral part of marketing on the internet, but the benefits can be seen not just by the customer but by the retailer as well.

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Check out these extra opportunities to earn double the normal Cash back than normal:
All new members of Cashback Club get £5 in addition to any of the offers below.

BetFair
Double Cash Back - Now £25

Join Betfair and deposit at least £10, not only will you get a £10 free bet as a new customer, you will also get double cashback - now £25

Offer valid for the month of March, to coincide with the Grand National and Cheltenham festivals.

Thomas the Tank Engine Book Set
Double Cash Back - Now £8

Order the Thomas the Tank Engine book set from Books for Children, and not only will you get the 18 books in the series for only £4.99 (+£2.99 p&p) but you’ll get double the cash back now £8.

Whittard of Chelsea
Double Cash Back - Now 10%

Choose from Whittard of Chesea’s huge range of speciality teas/coffees and ceramicware, and you’ll get 10% cashback instead of the usual 5%. This is valid until 19th March. Incidentally if you order a mug, then expect a free Lindt Gold Bunny with your delivery!

These double cash back offers are only available for a short time, so take advantage of them today!

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The History of Cash-back

The concept of ‘Cash back’, a financial incentive or rebate, was born in Reagen America at a time when mass deregulation spread across the many industries. The financial industry in particular was to experience a great change as this era saw a boom in new competitors, resulting in a tidal wave of choice for the American consumers who saw a rise in fervent companies desperate for new custom.

As the many credit card companies battled to deliver the most competitive offers for their customers, the pioneering proposal came from the Discover Credit Card which made an industry shattering offer of 1% cash back of annual purchases. In short this meant that a cardholder who charged $5,000 over a twelve month period could expect to receive a cheque for $50. Although the cash back formula has evolved into a more complex system, the Discover credit card continues to thrive.

Cashback inspiration
The source of inspiration for cash-back schemes could be argued at great length, but some of the more obvious customer-rewarding schemes that still seem to prosper are the competition from airline companies who offer a variety of Airline Mile programs to encourage both loyalty of brand and repeat custom. The Air Miles Travel Promotions Company Ltd was formed in 1986 and was bought at a majority of 51% by British Airways soon after this, and so many credit card companies quickly followed suit and began to offer their own competitive rewards with travel. However, whilst there continues to be a loyal following in repeat customers, gaining new interest in the benefits of Air Miles has proved challenging and in order to reach their potential customer base, credit card companies had to evolve again.

To clarify that customers could reap more rewards, banks soon changed the name of their rewards from credit card miles to credit card points, opening up a variety in incentives to suit a much wider range in customers. This promotional attack seemed to work as customers really began to take notice of these offers. From the 1990’s right through to the twenty-first century, consumers found that the principle players in the credit card market were offering a cocktail of rewards (and still are) on travel, fuel and cash-back rewards. Again, travel rewards hit back by elaborating their offers to include rewards on hotel rooms, fuel and entrance fees for a variety of attractions; a pattern seemed to be emerging and the winners were those consumers prepared to do a bit of research.

In light of the various air-mile and credit card schemes that became available throughout the 1990’s, identifying the shopping patterns of customers quickly became more important as competition increased. It became evident then, that companies soon began to understand the need for broadening and strengthening their customer focus; it is easier, cheaper and more productive to encourage an existing customer to be loyal than it is to entice new shoppers.

As the age of the internet began to grow (but was still a relatively new phenomenon for the ordinary shopper), loyalty reward schemes continued to take shape in the form of the loyalty card, points cards, the rewards card, and club cards. It is estimated that around 85% of UK households today have at least one active loyalty card confirming that the consumer is always ready to be rewarded for their spending and their custom.

Businesses initially capitalised by offering benefits that cost little but appeared unique, but once again, competition from other retailers pushed the boundaries and with the arrival of the internet, came a brand new contender.

Cashback and loyalty
As the internet has become more accessible into households, retailers have really had to step up to the challenge of retaining customer loyalty. Shopping has become much more convenient for consumers, not just in a literal sense with the arrival of home delivery, but with the explosion of a variety of websites that offer prices to rival the industry giants. E-Bay should at least be acknowledged here as being one of the largest sites to challenge prices; as an auction site the customer is able to set their own price, but the sheer scale of this internet phenomenon could certainly be considered as one of the inspirations for the power of internet advertising…and so…the next phase arrived in the form of cash back websites.

According to figures published by the Interactive Media in Retail Group, one in ten retail purchases in the United Kingdom are now made over the internet. The ability to make quick comparisons, cheaper prices and the convenience of not even having to leave your home has lured many consumers away from the high street. New websites are capitalising on this next stage of consumer-evolution by offering a refund of a fraction of the price every time the customer buys through a ‘linked’ retailer.

Cashback websites
Understanding cash back websites requires us to first of all comprehend that when someone clicks a link on the internet that leads them to a new site; it is actually rather easy to track where that click originally came from. The many millions of websites are therefore able to use this to their advantage by uniting with affiliate programs. Essentially, cash back websites usually gain commission by directing customers to associated websites, earning money when the customer spends as a result of that introduction. By offering a percentage of that commission money back to the customer, the cash back site still makes a profit and achieves allegiance from its shoppers.

In a sense, cash back sites are really advertising sites: they list a variety of retailers and when you click through these websites, they are rewarded for ‘introducing’ or ‘providing leads’. But, with cash back sites, some of the revenue earned is rewarded back to you the customer.

It would seem that modern consumerism has finally reached its potential, the ultimate range in choice of retailer with financial rewards to boot. Cash back websites have a range of incentives themselves, from financial bonuses for committing to other potential earnings for introducing family and friends. Finally, it would seem, it is actually possible to be paid for shopping.

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An introduction to cashback sites

The fight for precedence in the modern retail markets has long been a fierce one. Retailers have flourished in the sense that society has a more disposable income than it once did and credit is available more freely, but with the rise in consumerism, so too has the marketplace exploded and competition swelled. The retailer’s quest for new and loyal customers has become a challenging industry in itself and in order to stay one step ahead, marketing techniques have had to evolve just to retain profits.

Where the 1980’s introduced the concept of rewarding customers with programs such as Air-Miles and low interest credit cards, the increase in competition led to more personal rewards for customers, adopting a variety of formats like loyalty cards, cash back, rewards cards and club cards. But with the arrival of the new millennium and the rise of home internet connections, the shopping possibilities for customers have exploded. Cheaper prices, the freedom to make comparisons quickly and with the convenience of not having to leave your own home, are just a few reasons as to why the crowds are being lured from the high street. It is now estimated that almost 1 in 10 retail purchases are now made over the internet and so it comes as no surprise that a new breed of websites are making the shopping process that little bit easier.

Introducing cashback sites
Cash back sites are specialist internet programs that essentially introduce the consumer to the most competitive retailers via affiliate links on the cash back pages. It is important to understand that when a person ‘clicks’ on a link that leads them to an another website, that website can very easily trace where that ‘click’ came from. I.e. they can track how well their advertisers are working for them by monitoring how many people are introduced to their business from that particular site. Cash back websites receive commission for directing customers to the retailers’ sites but, essentially, they then offer a high percentage of this commission back to the customer.

Cash back websites have found a way to capitalize on the modern standards and expectations of the consumer but have taken reward schemes to the next level by promising to make their members’ money go that little bit further. The sites are a great money saving concept made possible via internet marketing and it is a successful method of advertising as they only pay up when they get the sale; but remember that many of the best bargains are available for a limited period only so it is advisable to stay on top of them and make visiting the cash back website a priority place for shopping.

It would be natural to feel suspicious of any website that not only offered high discounts, but also offered a financial incentive just for signing up, but the discounts on products that are available should speak volumes alone. It would of course be advisable for anyone to research a little before committing and consider the long term benefits that having a little insight can achieve.

Cashback = real money = real savings
The possible savings cover all kinds of products from everyday household items such as; mobile phones, DVD’s and books, to those products that would require a certain knowledge or be more time consuming if bought on the high street such as travel, Broadband and motoring; but the most profitable deals usually involve finance related products such as insurance, loans and mortgages, where significant amounts of cash back can be garnered from a single purchase. In keeping with the earliest marketing features of pre-internet products, cash back sites can also offer great bonuses for those customers who introduce family and friends to the websites. Customers can therefore benefit from gaining more money for their cash back whilst the website saves on advertising. Up to an extra 5% can be gained every time the customer spends simply by making purchases on a cash back credit card though naturally the benefits will only really apply to those who clear their balance by the statement deadline.

Some cash back sites can place a threshold on when earnings can be withdrawn from accounts though this is primarily a loyalty-driving feature, encouraging customers to return on a regular basis.

The rising number of cash back sites can of course bring about the confusion and sense of being overwhelmed that they originally intended to help overcome; and there are several other factors to be considered in order to give a fair introduction to these new programs.

Customers should be wary of paying a cash fee upfront and some sites do charge an annual subscription which is taken out of the money the customer has earned, so check for the small print to see if these factors apply and consider the better long-term offers. You should never have to pay in order to receive money and although rare, the internet will always be vulnerable to scams, so beware! The safest action would be to avoid spending money earned from cash back until it is in your account.

Getting the cashback cash
Once earnings have reached a set amount, the customer can request a direct payment on the cash back website. Payment is usually made via BACS (bank transfer) though some sites will also offer gift vouchers or coupons that are obtained at a trade price saving the cash back website money from issuing online vouchers. The vouchers are sent via e-mail and issue a reference which can be entered onto certain online stores to redeem from the final cost of their purchases.

Though still a relatively new concept to the internet, cash back websites certainly represent the most contemporary way of shopping in an era that has come to rely so heavily on the World Wide Web. Credit should be acknowledged to these sites for offering financial incentives to customers who would otherwise be vulnerable to the competitive prices of an unfaithful economy. If time, effort and money can be saved with a guaranteed annual return on expense then surely serious consideration should be given to making these websites a part of our routine.

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Big Idea Media Ltd are proud to announce the launch of cashback shopping website Cashback Club. Powered by eDealsUK, Cashback Club pays you every time you shop online, giving you cashback from in excess of 1,200 retailers, including Comet, Currys and PC World.

Membership of Cashback Club is totally free, and new members get a free £5 welcome bonus. Cashback is then tracked automatically when you click through to a retailers website from your Cashback Club members area  - Usually you will receive a percentage of your spend at each site, ranging from 1% up to around 15% on some sites.

All this cashback is then amalgamated in your Cashback Club members area, and paid out to you in one single payment. It’s a very similar service to that offered by Tesco Clubcard, Sainsburys, Nectar etc, only with Cashback Club, you’re not tied to only one retailer - you can get cashback at hundreds of different retailers, with more joining every week.

As a membership-focussed site, Cashback club reward you for recruiting new members - you’ll get another free £5 for every one of your friends that joins (and of course, they also get a free £5) - it’s far too good to keep a secret, so tell all your friends and family about Cashback Club today.

In addition to the cashback being offered, Cashback Club also provide their members with free discount codes and vouchers to be used at retailers - again at no charge to Cashback Club members, and they also keep an eye out for any extra-special discounts or sale items that will save their members a considerable amount of money.

Join Cashback Club today (Don’t forget it’s free to join the club) and start saving money right away!

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