Loyalty & Rewards

How Merchants Can Tap Into Cash Back Promotions

Cash Back

Merchants can capitalize on word-of-mouth marketing through cash back platforms such as DOSH that encourage social media sharing. These platforms reach consumers by reinforcing a behavior that consumers already exhibit — shopping with their credit and debit cards — while giving merchants valuable data.

Uber did not my change my behavior: I was already getting yellow cabs and black cars,” DOSH Founder and CEO Ryan Wuerch told PYMNTS in an interview, drawing a comparison between the ubiquitous ridesharing service and his platform. “They just created an app and made it easier for me.”

So, every time a consumer goes out and makes everyday purchases — like gas or movie tickets — DOSH incentivizes consumers with cash back offers to shop at specific merchants by connecting their credit and debit cards to the DOSH mobile app.

For merchants, the app provides behavioral insights that allow them to micro-target potential customers, track performance and acquire new customers. The app also seeks to help merchants improve customer loyalty and social amplification.


Cash Back

DOSH isn’t just a digital coupon or a mobile offer. The app offers cold, hard cash as a reward in lieu of points.

After earning cash back from a merchant, users can opt to transfer those funds to their checking accounts. Alternatively, they can donate their earned cash to a nonprofit organization such as charity: water.

Some users have earned quite a bit of cash through the DOSH app. It’s become like a competition among users.

“It’s almost becoming gamified,” Wuerch said, adding that some people are posting their DOSH wallets to show how much cash back they’ve earned through the app.

The cash back concept isn’t new. Yelp, for example, launched a cash back service more than a year ago.

“The merchant has the flexibility to set how much they want to offer as an amount of cash back,” David McKie, director of Business Development at Yelp, said. “Those offers generally range from 5 to 10 percent.”

With Yelp’s program — similar to DOSH’s — customers’ payment cards are tied to their Yelp accounts. When a consumer uses that card to pay online or make an in-store purchase, the merchant recognizes the card as registered in the cash back program, and Yelp’s back end handles the funds.

Other cash back services include SavingStar, Snap, Checkout 51 and Ibotta, which give consumers money back when they purchase items such as a JENNIE-O frozen turkey or Dole pineapple juice. After users download these apps, they can scroll through offers at major retailers like Stop & Shop, Target and Walmart to see which items are eligible.

This group of shopping apps works a little differently than DOSH: After customers take a photo or scan a barcode, the apps add the cash back to the users’ accounts in one or two days. When their accounts reach a certain threshold, users can ask for checks or transfers to their bank accounts.

Checkout 51 can be used in any store, as long as the receipt spells out the name of the product, while Ibotta can be used at select retailers. In addition, SavingStar must have a minimum of $5 to earn rewards, and the money is sent to a PayPal or bank account, while Snap works at any store and users can get a check when they earn above $20.


Social Media

DOSH could work to promote restaurants such as Chili’s Grill & Bar: The app could notify users of a deal just before lunchtime.

Wuerch, for example, was planning to order Japanese food for lunch when he saw a cash back offer at Chili’s. As a result, Wuerch ended up ordering from the Tex-Mex restaurant instead.

To help offers gain more traction, DOSH allows users to share them with friends on Facebook. To encourage social media sharing, DOSH offers a cash back bonus to consumers who share an offer, which creates more exposure for merchants such as Chili’s.

“Now everyone across the country — my friends — are seeing me promote Chili’s,” Wuerch explained.

And social referrals go a long way. Ninety-two percent of people buy something on advice from a friend, he said.


New PYMNTS Study: Subscription Commerce Conversion Index – July 2020 

Staying home 24/7 has consumers turning to subscription services for both entertainment and their day-to-day needs. While that’s a great opportunity for providers, it also presents a challenge — 27.4 million consumers are looking to cancel their subscriptions because of friction and cost concerns. In the latest Subscription Commerce Conversion Index, PYMNTS reveals the five key features that can help companies keep subscribers loyal despite today’s challenging economic times.