ShopBack began out 9 years in the past in 2014 because the brainchild of former Zalora executives Henry Chan and Joel Leong. The cashback rewards firm recorded solely three transactions a day when it first began, nevertheless it has since grown to turn into certainly one of Singapore’s rising startups.
Last December, ShopBack raised a complete of US$160 million in its Series F funding and to date, it has managed to develop its presence throughout Asia Pacific, together with Australia and most lately, Hong Kong.
But how did the corporate make it this far? At ShopBack’s flagship retailers summit, SPARK 2023, held final Thursday (July 6), Henry, Joel, and different key ShopBack executives shared the secrets and techniques behind the startup’s hovering success.
The potential of internet online affiliate marketing in Southeast Asia
Image Credit: ShopBack
ShopBack is a cashback rewards platform that enables its customers to obtain a small share of their purchases on the platform, which is paid for by retailers.
This is made attainable via internet online affiliate marketing preparations, the place the retailers pay a charge to ShopBack to drive sales and site visitors to their web sites.
The idea of internet online affiliate marketing on the Internet was conceived of, put into apply, and patented by American entrepreneur William Tobin in 1989. William utilised internet online affiliate marketing to promote flowers, and thru this advertising and marketing technique, he managed to promote US$8 million {dollars} price of flowers.
Following William’s success, the idea of internet online affiliate marketing shortly unfold via the United States and was ultimately leveraged by e-commerce giants reminiscent of Amazon and LinkShare. By 2013, the affiliate business truly made up about 50 per cent of all e-commerce sales in the United States.
Joel Leong, co-founder, ShopBack (left) and Alessio Romeni, Managing Director, ShopBack (proper) at ShopBack SPARK 2023 / Image Credit: Vulcan Post
Today, internet online affiliate marketing has grown to a US$20 billion greenback business, with curiosity in the sector rising by virtually 300 per cent from 2017 to 2021 globally. According to Joel, this development will be attributed to three primary causes.
Firstly, internet online affiliate marketing will increase (*3*) buyer base. William initially had a restricted buyer base, however the affiliate programme allowed him to develop to an even bigger pool of consumers and thus, he was ready to promote extra flowers.
Next, internet online affiliate marketing is [solely] centered on sales. It doesn’t drive CPC (cost-per-click), it doesn’t drive CPA (cost-per-action), it doesn’t simply drive impressions, nevertheless it focuses on what the retailers need, which is sales.
Last however not least, the charges for internet online affiliate marketing are fastened. Unlike most advertising and marketing campaigns, you wouldn’t be left questioning in regards to the sales report or the ROI (returns on funding) on the finish of a marketing campaign.
– Joel Leong, co-founder, ShopBack
That stated, the business remains to be very a lot centered on the United States, with the nation driving virtually 60 per cent of this development. Seeing how the idea was nonetheless nascent in Southeast Asia, each Henry and Joel, together with their different co-founders, determined to launch ShopBack in the area.
What is driving ShopBack’s success?
But why precisely is ShopBack’s internet online affiliate marketing enterprise mannequin working right this moment? The purpose behind that is easy — ShopBack brings a win-win perspective for each its two key stakeholders: its clients, and its retailers.
From a buyer’s perspective, there are a plethora of choices out there — in truth, there are shut to 10,000 retailers for them to store from, from groceries to journey and trend, all inside a single app. This breadth of choices, coupled with the benefit of use and the rewards granted by the e-commerce platform elevates its customers’ purchasing expertise.
After all, purchasing, for a lot of, is a deeply private and emotional exercise.
Justin Lee, Chief Product Officer, ShopBack, at ShopBack SPARK 2023 / Image Credit: Vulcan Post
When you store, I’m fairly sure that you’ll undergo a variety of feelings. Sometimes you store if you’re bored, or at different occasions, you may be annoyed at your purchasing experiences.
But one factor I’m sure ShopBack has completed constantly effectively over time is to result in this notion — over the previous 9 years, we’ve been in the enterprise of constructing purchasing rewarding. We’ve made tens of millions and tens of millions of our customers really feel nice about their purchases by continually bringing new worth to them.
– Justin Lee, Chief Product Officer, ShopBack
As a end result, ShopBack is in a position to appeal to all kinds of consumers for its merchant-partners by providing a variety of choices. Notably, retailers are solely billed for sales which are efficiently generated via ShopBack’s platform.
Extending past on-line to offline
Beyond simply driving on-line site visitors and sales, ShopBack has been making constant efforts to develop its choices into the offline area since 2020 to keep extra aggressive in the e-commerce area.
The integration of ShopBack’s on-line and offline choices, particularly since its entry into the funds area with ShopBack Pay and ShopBack PayLater final yr, has introduced in extra worth for retailers onboard the e-commerce platform by attracting a fair wider pool of consumers.
Henry Chan, CEO and co-founder, ShopBack, at ShopBack SPARK 2023/ Image Credit: Vulcan Post
[By bringing ShopBack’s offerings from online to the offline world], we’ve got helped customers to save throughout a bigger watershed. As for retailers, we permit them to have interaction with customers in new methods, in the actual bodily world.
– Henry Chan, CEO and co-founder, ShopBack
One method the corporate does that is by working attention-grabbing offline activations in collaboration with its retailers companions.
“We partnered Booking.com to run an offline activation. It was fairly cool to see queues nonetheless forming at our sales space regardless of the occasion closing at 10pm. Beyond viewers engagement, we turned offline customers into on-line clients, driving 3 times extra sales for Booking.com,” he added.
The startup has additionally labored with homegrown manufacturers reminiscent of Love, Bonito, to run omnichannel campaigns. For its newest omnichannel marketing campaign, ShopBack managed to drive S$3 million in sales for the clothes model over a interval of simply three months.
Aside from working campaigns, it has additionally launched options that combine its on-line choices into the offline area. For occasion, the platform’s card-link characteristic lets customers earn cashback offline by utilizing the cardboard linked to their ShopBack app to pay for his or her purchases at ShopBack’s accomplice retailers’ bodily shops.
How ShopBack drives sales its regardless of inflation
Beyond this, the homegrown startup additionally acknowledges and addresses the challenges that customers at present encounter, reminiscent of inflation.
“We know that customers right this moment face rising prices due to inflation, tightening [their] budgets due to recession,” famous Henry.
This is why ShopBack runs campaigns which are “proper for the time”, reminiscent of its marketing campaign in Australia, “Fight Back with ShopBack, Get Better Bang to your Buck”, which goals to deal with these challenges.
Aside from this, it additionally takes a novel method in direction of aiding its customers. Rather than emphasising on spending cash, it prioritises showcasing the quantity clients can save by utilising ShopBack, which helps drives sales.
According to Joel, a median person would have saved about S$139 as of right this moment, if that they had joined and utilised ShopBack since January 2022. In complete, the startup has given out S$460 million in cashback to its customers since 2014.
Jodie Lam, Regional Head of CRM and Product Marketing, ShopBack (left), and Isaac Timothy Tay, VP of Product, ShopBack (proper), at ShopBack SPARK 2023/ Image Credit: Vulcan Post
Nevertheless, ShopBack’s core essence stays that of a expertise firm. Therefore, fixed innovation aimed toward offering more and more rewarding experiences for each retailers and customers lies on the coronary heart of their operations.
Currently, a big emphasis is positioned on personalisation and the implementation of options that successfully captivate their viewers, leveraging the ability of knowledge.
Over the previous 9 years, ShopBack has amassed an enormous quantity of client information, particularly from about 40 million of its customers throughout a number of continents and completely different transaction classes. Through this information, the corporate creates hyper-personalised content material for customers, making certain that the “proper content material is confirmed to the appropriate shopper on the proper time”.
We construct these [hyperpersonalised] campaigns to discover perception and join with our manufacturers. And in return, we purchase new clients which are excessive worth and high quality, maximising our return on funding (ROI).
– Jodie Lam, Regional Head of CRM and Product Marketing, ShopBack
Jumping onto the AI bandwagon
In order to leverage this information, ShopBack utilises quite a lot of machine studying fashions and synthetic intelligence (AI) to analyse particulars such because the classes customers have an interest in, areas that customers are transacting from, in addition to person affinity.
Since ShopBack led to these personalisation adjustments, the startup has seen an elevated quantity of purchasing journeys per service provider and an expanded person base.
Isaac Timothy Tay, VP of Product, ShopBack, at SPARK 2023/ Image Credit: Vulcan Post
Our customers are additionally much more engaged. The metrics are monitoring effectively, the variety of purchasing journeys per person is rising, and the conversion price on these customers are so rising.
But very importantly, our customers are having fun with this new expertise. Our retailers are additionally seeing much more demand for now, as customers at the moment are seeing presents which are related to them primarily based on their previous interactions.
– Isaac Timothy Tay, VP of Product, ShopBack
Aside from utilising machine studying, the startup can be experimenting AI instruments reminiscent of ChatGPT in its inventive processes. With its person base steadily increasing, these instruments assist the corporate velocity up its processes and content material creation, amongst different use instances.
Nonetheless, Jodie Lam, the regional head of CRM and content material advertising and marketing at ShopBack, reassures that each one the content material put out by the startup are totally vetted and undergoes high quality management.
“I promise you what you see and skim that comes from us, and has not come instantly from an AI mannequin,” she asserted.
Becoming the “world’s most rewarding method to store”
Image Credit: Kris Shop
Despite shedding about half of its income in a single day due to COVID-19, ShopBack has come out stronger.
We had to tide via COVID-19, unsure of how lengthy it could final. But now that COVID-19 is behind us, a brand new problem that exists — which is a recession — and it’s doubtless to final for years to come.
Yet, amidst all these ups and downs, I’m very proud to share that we proceed to develop yr after yr. Last yr, we drove S$5 billion in sales.
– Henry Chan, CEO and co-founder, ShopBack
Over the final 12 months, ShopBack has efficiently onboarded a powerful 5,455 new retailers onto its e-commerce platform, accounting for greater than half of its present service provider base.
In addition to this growth, ShopBack has bold plans to lengthen its presence past the Asia Pacific area in the approaching months. According to Alessio Romeni, the managing director of ShopBack, the corporate has made a dedication to enterprise into a brand new market yearly.
This yr, they’ve set its sights on Germany, marking an thrilling step ahead for ShopBack because it expands its international footprint.
While the last word imaginative and prescient for the startup is to turn into the world’s most rewarding method to store, Henry acknowledges that there’s “nonetheless a lot work to be completed” earlier than this objective will be absolutely realised. Despite the challenges forward, ShopBack stays undeterred in pursuing its daring imaginative and prescient.
Featured Image Credit: East Ventures
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