How The Cashback And Coupon Industry Is Influencing India's Ecommerce Sector
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
India is growing rapidly in the e-commerce market and the future is even brighter. Experts believe that India’s e-commerce market is expected to grow to $ 200 billion by 2026 from $38.5 billion in 2017. By 2034, this industry has the potential to become the world’s second largest, just behind the US.
With busy schedules, more consumers prefer to shop online. One of the major factors that have contributed to this surge is the trend of unlimited coupons and cashback offers provided by various online stores and payment apps. These discounts have proven to be a win-win situation for both the parties as it brings in a huge customer base for the retailers, with the former receiving their products at a more affordable price.
How The Consumers Are Benefitting?
The mantra of “A penny saved is a penny earned” is something consumers swear by. With so many products and brands in the market, the impulse to buy is unavoidable. However, the price factor can sometimes create a huge hindrance and this is where cashback and coupons websites comes into play.
With the help of digital wallets, there is always some amount of cashback which end user receives now days and this is how shopping never stops. If discount helps the customers to get attracted to an online site, cashback and coupons ensure that they retain those customers. This promise of permanency is the best thing about such deals.
With many websites offering their cashback wallets, customers now get to choose the one that will provide them with the highest saving offer. This is how customers are making a wise decision and saving their hard-earned cash.
Apart from regular offers, Indian market sees special holiday discount spurs for the customers to benefit off of. Since the beginning of the holiday season and in-between festivals, there is a surge of cashback and coupon offers on top of discounts. Fashion portals, gadgets website, automobile companies, home décor, makeup and skincare, even body and health brands are offering extra savings during certain occasions with the help of cashback wallets and coupons.
Big Retailer And Cashback Sites Ties-Ins
Major e-commerce players now understand the benefits of discount coupon and cashback sites. It has helped them to rope in and retain an even larger market share and stay ahead of their competitions. This B2B transaction helps the cashback websites to earn a commission and from that, they are able to offer a percentage back to the shoppers in the form of cashback or rewards. With higher profit margins investments such as free shipping or free cash on delivery services have increased tremendously.
By the year 2020, revenue from India’s e-commerce sector is expected to be worth around the $120 billion as it grows at an annual rate of 51 percent, which is the highest in the world. This is an enormous surge when compared to the revenue from merely two years back which was worth $39 billion. There is no doubt that the success of Indian e-commerce largely depends on such money savings trends. They are the driving force behind Indian e-commerce as this is what distinguishes between shopping online and offline.
Small And Medium Enterprises Are Not Behind
India is currently at its peak in the entrepreneur platform with over 40 million SMEs all over the country. Many of them have an online presence since it’s easier to make a website than open an offline shop. They have found a unique way to advertise their company as well as increase brand recognition by entering into a partnership with various cashback and coupon websites. It is a risk-free and cost-effective method to introduce its brand to a newer audience and market their products.
As India grows towards digitalization, online wallets and cash payment apps are becoming more and more frequent. According to an Assocham-PWC India research by the year 2023, digital payments in India is expected to hit the amount of $135.2 billion, increasing at a rate of more than double when compared to this year’s $64.8 billion. Both SMEs and cashback industry have jumped on this bandwagon because digitalization is the future.
The Future Of Online Cashback And Coupon Industry
Now that both e-commerce platforms and the consumers have accepted the numerous advantages of cashback and coupon model, the future is brighter than ever. Currently, the cashback and coupons marketplace is valued at over Rs. 500 crores and increasing. The notion that a product is cheaper online than a regular shop has come because of this cashback and coupons.
Over the last few years, lots of new online shoppers are coming online and doing 1st transaction, especially users from tier 2 and tier 3 cities. A Cashback website helps retailer get higher conversions by offering these new users certain cashback/reward, ensuring them a cheaper price than the offline store.
As the e-commerce, coupon, and cashback Industries are here to stay, many retailers have started using the services for their offline stores as well, so that their products can be sold from both the platforms. This has further ensured a substantial amount of consumer entry as they can now have a plethora of options- both online and offline.