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Shopify app Fondue CashBack has raised $10 million in seed funding, the corporate announced Monday (Sept. 19).
Based in Tel Aviv and New York City, Fondue’s app replaces coupon codes with brand-embedded CashBack.
“Brands are addicted to legacy discounting strategies like coupon codes, thinking it’s just the cost of doing business,” Oren Charnoff, CEO and co-founder, stated in a information launch.
“Fondue CashBack is more profitable than legacy discounting so brands enjoy a positive feedback loop of higher conversion, more profit, more LTV [lifetime value] — money they can reinvest back into sustainable growth.”
The firm says it plans to make use of the funding to spice up product improvement, broaden its offline CashBack channel, and velocity its go-to-market technique within the face of rising demand. The firm tasks eCommerce gross sales will surpass $5.5 trillion this yr, with double digit progress persevering with yr over yr.
“Discounts are critical for driving conversions throughout eCommerce, and are reported to account for 17.9% of total sale revenue,” the discharge stated.
“Navigate to any Shopify merchant and you’ll be pummeled with coupon code offers. These are great for the simple reason that they work, but they come at an increasingly prohibitive hit to margin,” stated Dr. William Herlands, CTO and co-founder. “One of our merchant partners put it best: ’I give 15% codes to new shoppers, but that cuts my profit by over 40%. It’s impossible to grow profitably like that.’”
Consumers would relatively get money again than coupons, as PYMNTS famous just lately in a dialog with Inmar Intelligence General Manager Sylvain Mansier.
See additionally: For Consumers at Checkout, Cash Back, Not Coupons, Is King
As coupon availability declines, he stated, extra manufacturers have embraced digital promotions, whether or not meaning reductions to loyalty program members, or the rising use of money again, which he referred to as a device that doesn’t essentially contain a retailer or loyalty program.
“It’s not a discount at the register — it’s basically a post-purchase price discount, and it comes in the form of cash back,” Mansier stated. “Those are being more and more commonly utilized in combination with digital coupons.”
New PYMNTS Study: How Consumers Use Digital Banks
A PYMNTS survey of two,124 US shoppers reveals that whereas two-thirds of shoppers have used FinTechs for some facet of banking companies, simply 9.3% name them their major financial institution.
https://www.pymnts.com/apple/2022/apples-new-fitness-watch-may-be-a-back-door-into-connected-health/partial/
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