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Role of Cashback in Success of E-commerce – Alibaba ties up with Pennyful !


(Image Credits : www.nerdwallet.com)


Flipkart and Snapdeal trying every organic and inorganic route for market expansion, Amazon pumping in huge sum of money in this market and now Alibaba associating with Indian ventures to increase its presence in the country ! Several strategies are being deployed to win over this race of creating a dominance in Indian e-commerce industry.

One such recent drift in the industry being observed is inclination of e-commerce companies towards cashback sites. These sites are gaining momentum at a time when e-commerce industry in the country is consolidating and witnessing its peak. As per TOI data, cashback sites were already contributing to over 10% of customers on e-commerce sites and a continuous increase in the number is being observed.

Cashback, as the name suggests, is a service offered where shoppers get real money back to their bank account. Users can get cashback over and above the existing discounts they get when they shop online via these cashback sites. Currently, market size of cashback industry in country is gaining currency. Cashback sites like cashkaro.com, pennyful.in or baggout.com are some of the major players in this market.  As per the estimates, cash back industry is valued to be worth Rs 80,000-10,000 crore.

Birth of this segment has come from change in expectations and behavior of customers. Earlier, online shopping was merely related to the convenience of buying whatever you needed, from the comfort of your own home. But now, the consumers shop online with an aim to avail the comfort as well as benefit of the great prices and discounts available on online shopping stores.

Ravitej Yadalam, Founder and CEO of Pennyful, wanted to take advantage of this fact and give shoppers an additional way to save money. He took this to the next level and founded India’s first cashback site Pennyful. The company Pennyful Online Pvt. Ltd is divided into two parts. The first is Pennyful.com, which caters towards the U.S. market, and the other is Pennyful.in which is focused towards the Indian market. Both are essentially cashback shopping websites. (Full story of Pennyful here !)

Ravitej Yadalam, Founder and CEO of Pennyful

Ravitej Yadalam, Founder and CEO of Pennyful

Lately, e-retailers are taking keen interest in cashback sites. This trend is being seen due to added advantage of associating with cashback sites in the form of a better reach to more people. The scheme of offering cash back, in addition to discounts, attracts more customers. Moreover, these cashback offers are being offered to customers in various forms.

As shoppers, Indians generally look to save as much money as possible and hence the cashback concept has been very successful in the Indian market.Pennyful has been very successful in capturing this cashback market in India and is one of the leading players in the country in this field. The site is working with more that 250 top ecommerce websites such as Flipkart, Amazon, Myntra, Jabong etc. This list witnessed a new addition when Pennyful tied up with Alibaba around a couple of weeks back.


Alibaba provides the largest catalogue of products, giving shoppers access to a varied list of products that they can source or purchase from. This partnership is all set to drive maximum benefits to customers as they can earn cashback on top of every transaction at Alibaba, the world’s largest e-commerce platforms for wholesale retail, apart from access to the great prices at Alibaba.

“Alibaba is the most recent addition to our portfolio of partners, wherein customers get Cashback whenever they shop on Alibaba through Pennyful. Now, Shoppers get 1.5% cashback when they shop via Pennyful at Alibaba wholesale. This partnership works in the same way as with our other partners, i.e., whenever a customer shops on Alibaba through Pennyful, Alibaba gives us a commission, which is in-turn shared between us and our customer. With this partnership, Pennyful now has all of the largest E-commerce websites in its portfolio, including Flipkart, Amazon and Snapdeal” told Ravitej while talking about the association with Alibaba.  

The site recently introduced a new method wherein customers can choose to withdraw their cashback. Earlier, customers had the choice to either withdraw their cashback directly into their bank account, or donate to a charity of their choice. But now, customers are given with an option to withdraw their cashback into their Mobikwik wallet. This is intended to provide maximum comfort to customers, as they will now be able to use their cashback to directly recharge their mobile phones or pay their bills, through Mobikwik, with ease.

These excellent value-added services by Pennyful are definitely adding up to its portfolio. “Pennyful has been getting a lot of excellent reviews since the time of its inception, and the reviews on TrustPilot and Mouthshut are testament to that fact. Pennyful has the best customer feedback rating from shoppers among all the cashback sites in India,” says Ravitej.

The reasons behind consistently getting such high ratings are high level of satisfaction for customers. The site is focused on the customer’s shopping experience, customer care, high cashback rates, exclusive cashback offers, coupon offers, and the fact that there is no minimum cashback withdrawal limit. This means that shoppers can withdraw even say Re.1 from their Pennyful account, which other sites have a minimum threshold of Rs.250 etc. before they can get paid. “Our customers return to us because of the experience we provide, and not because they are forced to reach a threshold.”

Moreover,Pennyful-Alibaba partnership is being seen as a big step in the growth of both of these companies. With this association, the grip of Alibaba over e-commerce industry and Pennyful’s over cashback has strengthened.

By now, the company has given over a crore back to customers in the form of cash. The company saw a 150% increase Y-o-Y, in terms of customer base with last year, and this is expected to be 200% this year! Pennyful is working hard at bringing in more stores and services to their customers and proving to be their one stop shopping destination for any of their needs!




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