ShopBack claims healthy growth, but wants to step it up
By Goh Thean Eu June 20, 2016
- Says it now has 1,300 merchants in the region, 500 in Malaysia
- Hopes to grow by 20% month-on-month in GMV this year
CLAIMING it has been experiencing “healthy growth” – from gross merchandising value to its shopper base – the country manager of the Malaysian operations of Singapore-based cashback startup ShopBack is not entirely satisfied.
“I think there’s a lot of room for growth – after all, we are still a startup,” Gil Carmo (pic above) told Digital News Asia (DNA) in Kuala Lumpur recently.
ShopBack, which launched its service in September 2014, has a presence in five countries today. Beyond its home market, these are Malaysia (established in February 2015), the Philippines (June 2015), India (January 2016), and Indonesia (March 2016).
The company claims to have more than 500,000 active users regionally, of whom more than half (or 280,000) are from Malaysia.
Its portals across the region have been attracting more than 1.5 million visits (up from 1.3 million visits in October 2015) monthly, including 330,000 out of Malaysia.
Having 280,000 active users may not sound like much – after all, ShopBack defines an ‘active user’ as any customer who has purchased an item via its site over the past six months – but there is one interesting fact behind that number, according to Carmo.
“Most of the people who try our service usually end up shopping with us regularly, like once a month,” he claimed, adding that some 70% of users in Malaysia are repeat customers.
Cashback … wait, what?
To grow its business, ShopBack will need to focus on two key areas simultaneously: Growing its user base (in other words, shoppers); and growing its merchant base.
For now, growing its shopper base appears to be the greater challenge.
“Every day, we have merchants approaching us, wanting to be on our platform,” claimed Carmo.
Today, it has 1,300 merchants in the region, of which 500 are in Malaysia. He said he believes that it would be possible for the company to grow to over 2,000 merchants by the end of the year.
“However, we don’t want to be too focused on the numbers alone. Our main focus is to bring in merchants that our customers are looking for,” he said.
To grow its shopper base, Carmo said ShopBack would need to be patient and go back to basics: Education, or creating awareness.
“I think the challenge is not so much about educating people on online shopping – in fact, I think Malaysians are extremely educated when it comes to online shopping – but [on the concept] of cashback itself,” he said.
For users to get their cashback incentives, they first need to click on any store (merchant) through the ShopBack platform, and they will be redirected to the store’s website. They can then shop and make their purchase as usual after the redirect.
Different stores offer different cashback amounts: In some case, 1% of the total purchase value, right up to 10%. So if a user purchases an item for RM1,000 and the cashback is 5%, he or she will get an RM50 cashback.
The cashback can be redeemed after the order is validated by the merchant, and this will usually take 30-60 days, according to ShopBack.
ShopBack users can redeem (or cashout) as soon as it they have at least RM10 in their cashback account.
According to the company, it registered total cashouts of more than RM4 million (US$976,000 at current rates) in Malaysia last year, with the largest cashout by a single person being over RM9,000 (US$2,196).
Competition? Is all good
ShopBack is not alone in this space – even Indian cashback startup Getex has launched its service in Malaysia – but Carmo is unfazed by the competition. In fact, he is encouraged by it.
“This tells us that we are on the right path – if we were a standalone player, then there may be something wrong with that market,” he said.
To better compete against its rivals in this increasingly heated market, Carmo said that ShopBack would need to improve on all fronts, but “remain humble.”
“We believe everything can be improved – from the way we approach or help our customers, to the way we develop our products, and the way we market them,” he said.
“There is still a lot of room for us to improve – we are probably the biggest cashback site in South-East Asia (in terms of the number of merchants), but we need to remain humble and aim to be better every day,” he added.
With such an outlook – and the launch of a mobile app later this this year – Carmo is confident that ShopBack can achieve 20% month-on-month growth in GMV this year.
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