It’s been nearly two years since we published the industry’s first in-depth look at the global cashback industry. The 2015 Cashback Industry Report profiled the industry’s leaders. It brought together current research on cashback and promotion marketing, and helped establish the size of the industry at more than $80 billion at the time.
A new report from RetailMeNot provides a fresh perspective of what consumers want from digital and cashback rebates today. It also offers several case studies of retail ROI that in one industry sector exceeded 200%.
Titled “The State of Cash Back Offers“, the study shares valuable insight for marketers, retailers and e-commerce professionals. Among the report’s highlights:
- one-third of consumers will consider shopping at a new store if provided with a cashback offer
- 47% said they would consider buying if they could combine a coupon and cashback offer
- 20% said they purchased or spent more than intended due to a cashback offer within the past 12 months
- nearly 25% had redeemed a mail-in rebate or cashback offer in the past 12 months.
What consumers don’t like about cashback and rebates
Consumers are also very clear on what they don’t like and don’t want in their digital and cashback offers.
“We know consumers want to save every time they come to RetailMeNot, and cashback offers, combined with other marketing vehicles like promotions and discount e-gift cards, are powerful incentives to drive consumers to shop online, on their mobile devices, and in-store,” said Marissa Tarleton, chief marketing officer at RetailMeNot, Inc.
Here’s what consumers didn’t like according to the report:
- 96% prefer not to use mail-in rebates
- 70% prefer payment in ways other than a check
- more than 55% prefer to redeem cashback offers online
- nearly 50% found cashback offers difficult to redeem.
In other words, it’s a digital world and consumers are very comfortable with digital payouts and they don’t want to wait. Marketers and retailers need to shape their promotional marketing to make it faster, simpler and more valuable for maximum ROI.
What results can retailers expect with cashback promotions?
RetailMeNot shared some impressive results from a confidential survey of cashback offers used by 33 large, national retailers:
- retailers experienced a 3.4 times increase in conversions with cashback offers
- average order value increased 46%.
That’s powerful music to marketers and retailers’ ears.
When it comes to conversions, home and garden had the highest increase (+3.9 times), followed by clothing (+3.4 X), multi category (+3.4 X), health and beauty (+ 3.1 X), and kids and toys (+2.7 X). That translates into profits.
The report also provided valuable insight into the increase in average order value (AOV) by product categories: home and garden up from $29.60 to $91.50 (+$209%); toys and kids up from $95.40 to $139.40 (+46%); multi-category up from $86.60 to $112.60 (+30%); clothing up from $86.30 to $99.90 (+15%); and health and beauty up from $47.60 to $54.20 (+14%).
Need more convincing?
Benefits of cashback programs
In addition to the increases in conversions and average order value, other benefits of cashback programs included stronger customer engagement, a lower bounce rate on e-commerce websites and increased time spent on websites by consumers.
All in all, the RetailMeNot report provides powerful evidence of the benefits of cashback and rebates programs. The use of cashback programs continues to increase worldwide in both value and as an important part of promotional marketing strategies. Cashback leaders such as Ebates, RetailMeNot, Quidco, DubLi and Cashkaro continue to grow and appeal to consumers and marketers.
Global cashback perspective
Images: courtesy RetailMeNot, Cashback Industry News