People are 3X more likely to click through an ad and 30% more likely to make purchase that offers a $5 gift card compared to $5 off. That bit of social engineering gives personalized ecommerce rewards startup Ifeelgoods the potential to reinvent discounts.
Co-founder Suchit Dash tells me “It’s not about cramming a fixed reward down the consumers’ throats. The retailer doesn’t know what someone wants as a reward. We can target consumers with the most relevant reward, like this specific game, or something they’re interested in. Or they can pick any one they want.” For example, it knows iTunes gift card offers attract more clicks when run on Apple’s iAd platform that reach Apple device users who would enjoy some extra songs or apps.
It’s wins all around. Retailers / advertisers get more conversions on the things they sell, reward providers get people hooked on their marketplaces or services, users get something fun for free, and Ifeelgoods earns a margin.
Disrupting traditional dollars-off discounts could be critical for the ecommerce industry. Dash explains “If I give a $5 discount on a $50 product, you want it for $45 next time. But give away $5 of free stuff and they’ll still be willing to pay $50 in the future.”