How a cash-back app is a win-win for customers and brands
Each year, marketers continue to funnel enormous sums of money into digital advertising. In 2020, digital ad spend will exceed over $151 billion in the U.S. alone. There is considerable value in a brand’s ability to deliver personalized messages to its most valuable audiences through digital ads. Yet gaps in data, measurement and attribution prevent many marketers from knowing whether or how ad spending leads directly to purchases. Moreover, ubiquitous ad blockers and the lingering waste, ad fraud and brand safety issues that plague the media supply chain. And that’s just in digital. Turning towards traditional media and it only gets worse. The ability to attribute ad spend to a consumer transaction is literally impossible. All of this suggests it may be time for all marketers to consider whether a portion of their ad budgets would be better spent somewhere else.
That is one of the main reasons I founded Dosh (slang for money in the UK) back in 2016. I was looking to build a business that would meaningfully impact the lives of others. I was convinced there were other ways brands and retailers could use to connect directly with consumers beyond digital advertising—ones with more concrete proof of performance—and start building one-to-one relationships that engender loyalty and help grow brands and businesses. I believed that moving ad dollars directly into consumers wallets would not only positively impact their lives but also the brands and retailers who were wanting to connect with them.
Consumers expect value—and they want it now
Dosh operates on a simple business model: When a user shops, dines at a restaurant or books travel, the Dosh app automatically provides cash back offers for those brands, retailers or restaurants. Once users have set up an account and linked their credit or debit cards into the app, they can immediately begin earning cash back automatically on each transaction when shopping either in-store or online. No scanning receipts, activating an offer or code. Just automatic cash back.
The success of Dosh, which comprises a network of over 150,000 merchants and participating brands in the U.S. and millions of subscribers, reinforces some universal truths about consumer behavior. Today’s consumers expect brand interactions in the digital medium to be simple, easy and on-demand. They also often expect something of value in return for their loyalty and do not want to work hard for it. An automatic cash back proposition can unlock that value exchange and create an additional sense of instant gratification, which provides a more immediate benefit than, say, racking up points in a loyalty card program or downloading coupons. But the only way automatic cash back can work for a brand or retailer is data, provable data that shows attribution and incrementality. This is how the Dosh platform drives significant results for retailers and brands.
“Today’s consumers expect brand interactions in the digital medium to be simple, easy and on-demand. They also often expect something of value in return for their loyalty and do not want to work hard for it.”
Expanding the marketer’s toolkit
For marketers, Dosh expands the toolkit beyond advertising in several ways. First, it can introduce brands to an entire new community of users and open up many opportunities to tap into consumer shopping and spending behavior, all while aligning marketing goals and spend, to the point of transaction. For the consumer, they are rewarded with an invaluable surprise and delight moment, where the brand is given the recognition for that cash back, building brand loyalty and engagement. For example, come Valentine’s Day, consumers will search for ways to show their love for their significant other. Last year, a reported $20.7 billion was spent on the holiday. With Dosh, brands are able to segment their offers to appeal to audiences that have spent with competitors and conquest with a compelling cash back offer.
Billions of dollars are paid to the likes of Google and Facebook, but Dosh gives brands an alternative platform to engage with the consumer without the disruptive quality of most digital ads. Unlike traditional loyalty programs, which may increase transactions at a particular retailer but don’t necessarily build loyalty with any given brand, Dosh creates a surprise-and-delight moment each time the consumer spends, which reinforces the idea that the brand is the reason they are getting the cash back.
The Dosh model is not an entirely new idea—but the category is rapidly evolving. Cash back has traditionally sat in the affiliate space, whose model is based on commissions, but it is re-emerging in today’s landscape with a much deeper intrinsic marketing value as is now shown with every payment instrument trying to use cash back as leading differentiator. Millenials and Gen Z have come to not only know it but expect it. Marketers should understand that all cash back isn’t created equal. While it may be becoming mainstream with consumers, for brands, exploring how a cash-back partner positions the brand in that experience to the consumer is critical to driving value.
In today’s world, consumers have access to goods and services at their fingertips. They can buy pretty much whatever they want, wherever and however they want. The more brands can put themselves at the forefront of that shopping experience, and reinforce a value exchange with an instant reward, the more the dollars will flow for everyone.