Cashback offers have become a part of purchasing and marketing over time. Cashback offers seem like an incentive or savings for the customers, but for the company, it helps in building long-term relations with them. Companies offer cashback to their customers as it indirectly helps them to shop with them again instead of being a one-time purchase.
Human minds are attracted to offers and good deals. It is like this irresistible urge to have the product or service instantaneously and enjoy it thoroughly. It is like instant happiness or excitement but doesn’t emerge from a particular need in your life. This phenomenon is known as instant gratification.
Let’s understand this concept with an example of a cashback offer of any X product. They are giving 50% cashback on the minimum purchase of two, and the original price is Rs.400.
You will definitely take the offer because it saves you half of the money, but in fact you are not getting anything because that cashback money will be transferred in your e-wallet or on the company’s app.
Through the above example, we learn that now if you wish to spend that saved money, you have to buy that company’s product yet again. So think, if you are buying another product priced at Rs.400, so you will have to pay only Rs.200 from your pocket and an Rs.200 cashback amount will be added, which is nothing but a 25% discount. That’s how companies create a loyal customer base. But if we look at it from the customer’s perspective, there is no real need for the product, but still, he or she ends up buying it.
Advertisements are created in a way that they seem to appeal to the customer’s needs. It is based on emotional appeal, rational appeal, scarcity appeal, etc., which triggers the customers to buy the advertised product or service.
Emotional appeal works in the way that an emotion or sentimental value is associated with the product or service. Like Cadbury Dairy Milk chocolate ads, they are always backed by emotional story lines which make an impact on our minds in such a way that for auspicious and happy occasions we tend to buy Cadbury as if it’s the missing part of the puzzle.
Rational appeal targets our logical thinking as to why I should have the product and what its benefits are. As a customer, we always think about it, right? So what we do is look for it in every possible place, but with a discount mostly, and compare it with its substitutes to get the best out of the lot. So these types of offers are created to pose a company’s product as the best when compared to others.
Scarcity appeal makes people feel as if having a certain product will compulsorily make them feel good and safe. If you have noticed that sites like Amazon, Flipkart show that offers are available only for a short span or only a few pieces remaining, seeing which we rush to buy the product or service.
These are the tactics which companies use to get customers and retain them through one way or another like issuing a membership card, etc. So like some cycle, it goes on wherein you go to shop at a store, get coupons, go there the next time to redeem coupons, get some offer again and this goes on endlessly.
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