‘Free money has a way of sharing itself’: Dosh’s consumer shopping app enables retailers to target new customers
- Dosh is a popular ecommerce app which offers cash back to shoppers.
- Merchants use it as a transaction-based, new form of advertising.
A lot of the discussion on our podcast centers around customer acquisition. You may have a great product or service but if you can’t profitably acquire new customers at scale, you run the risk of being dead in the water. So, many of our fintech — and a growing number of our financial services guests — turn to advertising. It’s on Facebook that you can target down to niche interests and geographies of ideal customers. And our audience spends lots of money there. Overall, $200 billion will be spent on acquiring customers this way.
But what if there was a better way specifically for retailers to acquire customers. Dosh may very well be that better way. Instead of spending money with an intermediary like Facebook or Google, retailers put money directly in their prospects’ wallets through cash back campaigns. Consumers use Dosh to find good deals at stores. Stores use Dosh to acquire good customers based on their individual buying behaviors.
Dosh CEO Ryan Wuerch is my guest today on the Tearsheet Podcast.
What Dosh does
Dosh is an app that automatically finds cash when they shop, dine or travel. Dosh has tens of thousands of merchants across the US, including Dunkin Donuts, Kroger, Pizza Hut, Sam’s Club, and Forever 21. Customers shop and then receive cash back into the wallet that’s sitting inside the Dosh app.
Dosh is directly connected into leading card associations. A consumer downloads the Dosh app and loads up their credit and debit cards. He then shops normally, whether it’s buying gas or groceries. Dosh goes out to see if there’s an available offer and if there is, takes it and moves it into cash into the Dosh subscriber’s wallet to do what he pleases.
Dosh’s impact on consumer shopping
The biggest brands spend advertising dollars to get new customers to come into their stores and existing customers to spend more. Instead of brands spending money on ads, they utilize Dosh to create a new behavior. Consumers that get cashback on a purchase want to come back again. They feel more loyal and they tell their friends to go to the store, creating new customer acquisition.
Over $200 billion is spent on advertising and Dosh’s focus is to move those dollars away from television ads, billboards, and digital advertising on Google and Facebook and move them directly to people through Dosh. Our belief is that we can enable brands to better and more effectively reach their consumers by creating a behavioral stimulus called cash.
Retailers use Dosh
We have everything from the largest retailers using Dosh to local stores and restaurants. Here in the Austin, Texas area, we have something like close to 600 local restaurants inside the Dosh app.
Everyone can benefit from Dosh. No matter how much money people have, we all want to keep it for ourselves. I recently took a business trip to NY and booked my hotel online. I paid $279 a night — the best price online — and got $76 in cash back. Online travel companies are spending billions on advertising. Why wouldn’t we move these dollars directly to consumers?
First and foremost, we want to democratize advertising to help people everywhere. Travel has one of the largest advertising spend of any industry. Just two companies alone in the space spend over $10 billion in advertising every year.
We launched travel in July. We have one user who uses Dosh for business travel and he’s already received over $4,000 in cash back from booking hotels inside the app.
Merchants running offers on Dosh
We have some of the largest hotel wholesalers directly integrated into Dosh. We built our travel platform specifically for this integration. Our engine takes best retail pricing, best wholesale price, calculates the differential and moves that toward customers.
For other merchants and brands, they are given a dashboard that gives them targeting capabilities like ‘getting new customers’. This happens in real time and we know whether a customer has gone back to a retailer that she received cash back from. We can calculate whether a merchant’s cash back drove new customer acquisition. Similarly, if a merchant wants more loyalty, it can see how cash back influences repeat shopping frequency.
Changing the user acquisition model
Digital advertising isn’t able to do this. Because we are right at the transaction, we know definitively if you’ve returned to the store. We can see if the cash stimulus gets customers to spend more. We call it transaction-based advertising which we think is the most effective way to spend advertising dollars.
Our environment is very secure and protected so that a merchant can never see personally identifiable information. Everything is done on a cohort basis.
We make money by sharing in the cash back. Merchants and brands also pay us a fee to be on our platform. We launched in October 2017 and have moved approximately $60 million directly into our subscribers wallets.
Priorities for the rest of 2019
We’re focused on adding more merchants and subscribers to the platform. This past year, we became the number one app in the App Store out of all apps. Just shy of two years, we have approximately 10 million people interacting with the Dosh app. That’s all been word of mouth. Free money has a way of sharing itself.
Later this year, you’ll see one of the leading fintech firms directly integrate Dosh into its platform, so its users will be able to use Dosh for their everyday purchases.
We’re also rolling out more personalization in the Dosh experience around our users’ shopping behaviors.