It’s time for an update on cashback news, cashback promotions and insight into issues and trends impacting the industry and it’s biggest players in India. The Competition Commission of India (CCI) has created an expert panel to rule on cashback incentives which small retailers claim impacts their business negatively. With more than 800,000 cashback app downloads in India in its first year, LafaLafa has now launched in Hong Kong.
Crown-it CEO Sameer Grover continues his plans for aggressive growth for his cash and coupon company in India. As competition intensifies, Flipkart launched a partnership with lender Bajaj Finserv Ltd to offer e-commerce customers monthly payment options. With Q1 2016 growth of 21.8%, Jabong is inching closer to profitability. Startups Crownit, Fashalot and Nanolocal Technologies are succeeding by using loyalty points and by giving cashback on customers’ mobile phones.
Cashkaro CEO Swati Bhargava talks about the unique Indian e-commerce marketplace and culture. Smaller e-commerce players such as SyberPlace.com and Smartprice.com are piggybacking on coupon sites like Coupondunia and Grabon.in to build their business. Shopper-friendly coupon website, Newcomer PriceBurp.com is finding success by offering amazing coupon deals om Paytm, Lenskart, and Amazon.in.
CCI to decide on cashback given by online payment platforms like Paytm and Mobikwik
India’s competition watchdog has formed an in-house expert panel to ascertain whether the cashback incentives offered by digital wallets and e-tailers on recharges, bill payments or purchase of other products constitute predatory pricing.
Digital wallets and e-commerce companies such as Paytm and Mobikwik often offer cashback incentives to users making payments through them. “A panel has been formed by the Competition Commission of India (CCI) that is studying the cashback model being used by online payment platforms, e-commerce companies and also several banks,” a senior CCI official told ET, requesting not to be identified. The official said the move follows several complaints received by the commission on such offers. “This is a new market that we need to understand since we get a lot of complaints related to it,” he said. The panel is likely to complete its study and give its opinion within a couple of months.
“It has to be ascertained whether the cashback offers are being offered to create a new market by incentivising customers or to disrupt the competition in the existing market through predatory pricing,” the official said. Predatory pricing is an anti-competitive practice under India’s competition laws. It refers to a situation where a firm charges price below cost of production with the intent of forcing the competition to either immediately exit the market or exit after facing losses for a while. Once the competition exits the market, the predatory firm raises prices Via articles.economictimes.indiatimes.com
LafaLafa Hong Kong brings cashback savings
It did so well in India, with more than 800,000 downloads for its Android app, it even launched a Chrome browser extension there.
Just back from a startups Accelerator program in Silicon Valley, LafaLafa now has backing from Hong Kong-based Vectr Ventures. “Hong Kong has been my home for the past seven years, and it is incredibly exciting to see the growth of the startup ecosystem here,” says LafaLafa founder Yosha Gupta. Via .insideretail.hk
He spun childhood games into a cashback app. Now he wants you in ecommerce
When Sameer Grover was younger, he would collect the crowns of soda bottles and exchange them for discounts at local restaurants. It was like a game for him and his friends – they’d finish their drinks, twist off the crowns, and explore new items on menus. For restaurants, it meant that customers were spending more money and coming back more often.
Making a game out of discounting worked so well on Sameer that the concept lay dormant in his mind for years. “I watched the Indian market for a long time,” he says. “Couponing is huge in the USA, but it’s not big here. Once you get a discount from a restaurant, you end up getting bad service. It’s not respected.”
He waited and waited, until one day, the ecommerce craze hit India. Suddenly, people wanted to make it easy for Indians to buy things on the internet. As they built up ecommerce sites, though, they all came across the same conundrum: most people were too used to buying things from the country’s many small and medium businesses to move online. And, if customers did move online, all of those small and medium businesses would go bankrupt.
That’s when Sameer realized his childhood game might come in handy. With his co-founder Ashish Munjal, he built out Crown-it. Sameer describes it as an offline-to-online (O2O) marketing platform that helps local businesses make more money. It sounds complicated, but works simply. Via techinasia.com
Flipkart launches payment scheme to boost sales of costly products
India’s largest e-commerce Flipkart Ltd has started offering customers an option to pay via monthly instalments without charging them interest as it seeks to boost the sales of higher-priced products such as premium smartphones, televisions, home appliances and other electronics.
Flipkart tied up with lender Bajaj Finserv Ltd and electronics brands to launch the consumer finance product earlier this month. Customers can buy electronic products costing more than Rs.5,000 and pay in equal monthly instalments (EMIs) over three, six or nine months. Flipkart isn’t charging any fees, interest or asking for down payments from customers.
“According to our surveys, consumers are willing to pay more over time for essential things,” said Surojit Chatterjee, senior vice-president, product, Flipkart. “And in this case, it’s not credit as such because there are no fees or interest. In the three weeks that we’ve launched the no-cost EMIs, we’ve seen customers have upgraded their purchases because of it. We’re thinking of affordability as an overall problem to solve. We will come at this problem from different angles.”
The launch of the interest-free EMIs comes as Flipkart is trying to turn around its business, rev up sales growth and stem market share losses to Amazon. Via livemint.com
Jabong revenue grows in Q1 as losses shrink
Rocket Internet-incubated fashion e-commerce venture Jabong that hit a speed bump in the second half of 2015 has begun the new year with a marked improvement in performance while simultaneously cutting down operating loss.
The firm posted its best transaction volumes, net revenue and gross merchandise value (GMV) since October-December 2014 (the firm stated that its growth in Indian currency terms was higher still at 21.8%). Operating loss, too, was the lowest in almost two years (see chart).
It broke even at a gross profit level and attributed it to ‘improving intake margins and an increase in the de-risked business, including consignment, partly offsetting continued high levels of discounts’.
Jabong, which competes with Flipkart-owned Myntra among others, has been focusing on mending its leaking boat. Its EBITDA or operating loss (adjusted for share-based compensation) had been shrinking from Q3 and declined further in the three months ended March 31, 2016. The firm had first felt the pain of scaling back discounts from the third quarter of 2015 (click here) and saw an even sharper slide in business in the last three months of the year. Via vccircle.com
These start-ups pay you for your loyalty, just the way you want
In the age of e-commerce, we all are aware with the concept of cashback; however, a bunch of start-ups has now decided to give the power of redeeming these cashback points in the hands of their customers.
Start-ups like Crownit, Fashalot and Nanolocal Technologies have brought the concept of loyalty points, by giving cashback on customers’ mobile phones; furthermore, they are using gamification to make it more interesting and relevant for their customers, so that they can be attracted towards the services because of the benefits.
Sameer Grover, who founded the cashback app Crownit, told ET that the initial idea of launching a coupon-based app was because of the results of a survey, according to which customers were more likely to revisit a restaurant that offered them real benefits like free talk-time, rather than the ones where benefits depended on their future visits. Via businessinsider.in
India through the eyes of local startups
As a country prospers economically and when infrastructure permits, the ecommerce entrepreneurs come naturally. India is cited to be worth $38b in 2016, a 67 percent jump from 2015. It is slated to reach $100b in 2020, which is in tandem to the rising demand for goods and services by its huge domestic market.
And Swati Bhargava knows this opportunity. She cofounded CashKaro.com, a Gurgaon-based one-stop destination cashback and coupons site with a claim of 1 million registered users across India. According to her, the company has partnered over 1,000 sites via an affiliate model, including Flipkart, Amazon.in, Snapdeal and Paytm.
She said, “Indian ecommerce is growing really fast and the Indians’ love for deals is no secret. In fact, 80 percent of online shoppers look for coupons and cashback offers before they buy. CashKaro is the perfect way to participate in this ecommerce growth as we work with ecommerce websites across different verticals. Moreover, India is a very value-conscious market, so there is no better place to implement a tried and tested concept like ours.” Via techinasia.com
Smaller E-commerce Players Piggyback on Coupons, Cashback
Smaller players SyberPlace.com and Smartprice.com claim to have begun to see a surge in their sales merely by collaborating with affiliate websites. These e-commerce companies and web-stores are seeing a high growth and revenues on their platforms due to tie-ups with the couponing websites like grabon.in and coupondunia.in.
Couponing websites push traffic to the smaller e-commerce players’ sites, which helps them gain visibility in the e-commerce space. Additionally, coupons and discounts offered by smaller players bring down the products’ cost to a large extent, making online shopping far cheaper when compared to purchased from brick and mortar establishments. Via newindianexpress.com
PriceBurp.com Is Offering Amazing Coupon Codes for Shopping on Paytm.com, Lenskart, and Amazon.in
Being a shoppers-friendly coupon website, PriceBurp.com is offering amazing deals to browse the latest collections on leading web stores. The Mumbai-based company is run by IT professionals and avid shoppers to bring the best deals and offers available on Internet to its users. It is currently offering superlative discount coupons and coupon codes for shopping at Lenskart.com, Paytm.com, and Amazon.in.
Explaining about these deals and offers, a senior executive of the company stated, “Swelling number of online shoppers in India has made us a trusted coupon site helping retailers to grab best online deals. Our shopping experts bring exciting deals for shoppers after an extensive research on leading e-commerce websites. Since, we update our site on a daily basis, we have added top discount offers from Paytm.com, Lenskart, and Amazon.in recently on our site. With these coupons, users can shop for their favourite products and brands at attractive discounted prices.”
Currently, it is offering two active offers on Lenskart.com, 15 such offers on Paytm.com, and 14 offers actively applicable to Amazon.in. It is easy to search for such lucrative discount offers and codes on PriceBurp.com due to its easy search features and methodical listings. Famous e-commerce stores are listed on the website in an alphabetical arrangement. Users can simply find desired store on PriceBurp.com, get its discount offers, and save provided coupon code. Shoppers can use these codes on official seller website to buy any product at reduced prices. Via digitaljournal.com
That’s it for our India cashback industry update. Watch for more cashback company and country profiles in the weeks ahead.