cashback service and the increase in market regulation goods and the decrease in the profit margin of stores
According to the IDEA, Cashback, which some mistakenly equate with refund, is one of the new marketing methods in the world, which is used as a psychological stimulus to drive people to buy more and of course increase their purchasing power. The CEO of Takhfifan believes that the complexity of connecting to the necessary infrastructure to integrate the service with online websites, payment network, cash register software and development of the acceptance network is one of the challenges of providing this service in the country.
According to IDEA, the decrease in the percentage of cashback due to the decrease in the profit margin of the stores and also the increase in the number of regulated goods are among the others problems of providing the cashback service in Iran. Earlier, in a report in “Payment Way”, we introduced the cashback service and the applications that provide this service.
Steps to use cashback for users
The CEO of Takhfifan, the cashback service was introduced to the market in 2018 by Takhfifan with online purchases from Digikala, and today this service in Takhfifan is called the return of money for online purchases by connecting to more than 500 active websites in various categories, presented to users. He said about the path that the user takes in using this service: “The path that the user takes to use this service is that they first visit the discount platform at Takhfifan.com and adds their bank cards to the user account.” he adds.
He continued: “After searching between the website of the contracting party or selecting the desired category, after being informed of the percentage of cashback (return of purchase money), it will be directed to the desired site, and after finalizing your purchase on that site, you will receive the message of receiving cashback from He receives the discount and the cashback amount is deposited into his wallet in the discount.
Of course, in 2023, we tried to eliminate the complications ahead by adding cashback service to the internet payment portals, so that they can use this service more easily than in the past. On the other hand, the discounter’s cashback service can be effective for the growth of businesses and increase the sales of recipients by increasing the frequency of purchases.
The CEO of Takhfifan added that at the end of 2019 and after the success of the online shopping refund model, Takhfifan introduced the face-to-face shopping refund model by creating a centralized infrastructure connected to seven bank payment networks and three store cash register software located in chain stores offered to its users.
He explained about this: “In the case of cashback for in-person purchases, the user purchases in person from the contract party’s store with his bank card number that he has introduced to Takhfifan and receives the cashback percentage in his wallet at Takhfifan. One of the largest in-person shopping cashback networks with more than 30,000 stores in 500 cities of the country is owned by Takhfifan, and it is now available to users as a white label in payment applications such as App and Mobile Card.
IDEA believes that the complexity of connecting to the necessary infrastructure to integrate the service with online websites, payment network, cash register software and the development of the acceptance network (so as to include the maximum category of online websites and physical stores in a suitable geographical distribution), is one of the challenges of cashback in Iran.
Also, the main challenge for activity in this field is the decrease in cashback percentage due to the decrease in the profit margin of stores, especially FMCG chain stores, and the increase in the number of market regulated goods. Of course, due to the decrease in people’s purchasing power, the average amount of the shopping basket is left behind from the percentage of inflation.
He went on to say that another serious challenge is to change the customer’s desire from receiving discounts at the moment to receiving cashback, saying: “This practically means increasing purchasing power in future purchases. In order to solve this challenge, the main focus of the discounter is to increase the purchasing power of the customer, which is done by re-spending the wallet in the entire acceptance network (online and in person), connecting the common wallets of the country for spending in the discounter network, providing BNPL service, selling cards. Loyalty of the stores of the contracting party is done with excess discount and also, receiving cashback again.
According to global talk, cashback is one of the most popular services of the Save Money and Shared Loyalty Programs subcategory, which has occupied large companies around the world. For example, the largest company in this field is Rakuten, which has more than 1.5 billion users worldwide and has a GMV equivalent to 85 billion dollars in 2020, and currently nearly 70,000 brands worldwide operate in this company’s acceptance network.
Cashback does not mean getting back the purchase money
In response to the question of what are the differences between refund and cashback, Jahani said: “From this question, we can understand what a long way is ahead of us to create awareness of the value of cashback to the customer. Cashback, which is translated as “refund” in Farsi, does not in any way mean taking back purchase money after returning goods or services (Refund). Cashback means receiving a percentage of the purchase amount as a reward and using it again in the next purchase.
According to his words, according to the curve of Disruptive Innovation in innovative services in the field of fintech, it is not possible to imagine cashback with this model in the next five years, but it can be said that in general, the growth path of this service is towards providing services based on Data Insight, Customer Data Profile And Omni Channel Marketing will go and cashback solutions will be available in the development path for the user, adopter, manufacturer, manufacturer, importer and even the government, although these predictions are based on the analysis of the behavioral data of buyers.
In the end, the CEO of Takhfifan said about the necessity of cashback development in Iran: “The word “necessary” has a heavy meaning. If any service moves in the right direction of creating value, it will be useful. “Cashback also offers many values to its audience, which always focuses on the development of these values.”
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