Tuesday 13/11/2018 - 05:36 pm


Ibotta adds deep-linking technology to offer up to 40 percent cash-back rebates


2016.08.31 06:22

 When Ibotta linked its mobile-app users to cash rebates from online stores three years ago, the experiment failed. Miserably.

“We felt the tools and technology weren’t good enough for our use case,” said Bryan Leach, founder and CEO of the Denver-based shopping app. “You had to pinch and zoom. Customers weren’t getting an immediate notice on their reward. It was not seamless. We were unhappy.”

Leach is much happier today because the company took a different route to encourage mobile-app users to buy online: through another app.

In a week-long soft launch of the new program — which goes live Wednesday — a tiny portion of Ibotta’s 20 million users tried the new feature and wound up spending more than $1 million while using other apps, booking rooms on Hotels.com app, ordering beer from Drizly’s app and buying coupons with Groupon’s app. Ibotta integrated “deep linking” technology from New York’s Button to connect other apps to its own. Adding some custom technology, Ibotta’s app offers personal deals for users — and retailers, which can now change the rebate depending on the user.

“On the web, everyone starts with Google. But in mobile, that’s not where commerce starts anymore,” Leach said. “Ibotta is positioning itself as the front door to all mobile commerce.”

 

Ibotta’s app typically rebates cash based on a percentage of a user’s in-store purchase, like 25 cents for buying Bar-S Bologna at Walmart. To get the cash, Ibotta users must scan in a print receipt in the app and when they reach $20, Ibotta pays up. The new app-to-app feature is similar, but cash credit is automatic with payouts still coming in $20 increments. Some retailers credit accounts instantly while others, like Groupon, have a 45-day wait period.

Ibotta’s approach could help turn app users into actual buyers, which is not common, said  Andrew Lipsman, vice president of marketing and insights for market researcher comScore, Inc.  In comScore’s first-quarter report on U.S. retail, it found that two-thirds of consumers use a mobile phone to browse on a retailer site but end up buying on a PC or tablet. Mobile commerce made up just 20 percent of the $83.5 billion spent digitally that quarter.

“People are more likely to shop on mobile than buy on mobile,” Lipsman said, calling it the mobile-commerce gap. “Mobile has a lot more friction.”

Friction includes security concerns, inability to see product details, difficulty of navigating between screens and slow or spotty connection speeds.

“But we should see that gap narrow. People will get over security issues over time. Screen sizes are getting bigger and that’s helping dollars flow more quickly,” Lipsman said.

But the other boon for the app economy is the promise that Ibotta’s app will encourage people to try new apps. On average, says comScore, mobile users have no more than three retail apps, with the top one being Amazon.

Button CEO Mike Jaconi agreed that it may be a pain to download a new app, add a credit card number and remember to start using the app. But this isn’t about downloading a new app. It’s “the means to an end,” he said.

“As an example, with Ibotta we are seeing an install rate north of 59 percent, while industry averages are in the order of 15 to 20 percent,” Jaconi said. “The beauty of Button’s marketplace is that after the install, a significant number of these new users end up purchasing and becoming repeat purchasers.”

Ibotta’s tech team helped build an ad-targeting-like feature known as Dynamic Segmentation. That means Ibotta users who frequently use Groupon, for example, may get a 5 percent cash rebate.  But infrequent Groupon shoppers may see 40 percent offer.

But a key point, Jaconi added, is that buying on an mobile app is much easier than buying on a mobile website. App users have already logged in and stored a credit card and a shipping address.

“The reason mobile proved challenging for retailers was that checking out in mobile wasn’t easy — whether it was the slow loading and constant re-entry of credit card and address details,” Jaconi said. “Mobile web experiences were and, in many cases, still are terrible.”

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