Groupon Inc., Jet.com Inc. and Drizly Inc. are joining shopping app Ibotta’s web of deals.
Ibotta Inc., a U.S. retail shopping app that gives users cash back when they make purchases in stores, is expanding its business model to connect consumers to other shopping apps, essentially creating a shopping app marketplace.
The retailer apps now linked to Ibotta app marketplace include those of Groupon (No. 26 in the Internet Retailer 2016 500 Guide), online marketplace Jet.com, and alcohol delivery service Drizly. Retailer apps display their products within Ibotta, and Ibotta will give shoppers cash back through its app if a consumer makes a purchase from the retailer’s app.
Here’s how it works: When a consumer taps on a retailer’s product in Ibotta, such as granola bars from Jet, she is immediately taken to that product page on the Jet app. If the shopper does not already have the Jet app downloaded, she is taken to Apple’s App store or Android’s Google Play store to download it. If the shopper purchases anything on the Jet app after connecting to it via Ibotta, Jet will pay Ibotta a commission fee for delivering the shopper to the brand, and Jet shoppers will receive 5% cashback through Ibotta. Retailers only pay Ibotta a commission when a tap results in a sale. The commission fee varies by retailer, says Ibotta’s CEO, Bryan Leach, who declined to give specifics.
Ibotta’s shopping app has more than 18 million downloads, so this is a way for brands to get their products in front of more mobile shoppers. Ibotta’s app ranked No. 17 for the most used shopping apps out of 1,109 apps in the shopping section of the Google Play store for the period between Aug. 1 and 28, according to data from digital analytics firm SimilarWeb. SimilarWeb ranks Android apps based on an algorithm that factors in current installs and active users.
“We hope that the offer (on the Ibotta app) incentivizes users to give Jet a try and rewards our loyal customers for shopping on the Jet app,” says Lauren Picasso, associate marketing director at Jet, in explaining why Jet joined the Ibotta app marketplace.
A total of 9 apps are currently participating in this app-to-app connection including food e-retailer Boxed Wholesale (No. 405 in the Top 500), apparel marketplace Spring, ticketing app TicketMaster, on-demand cleaning service app Handy, hotel booking site Hotels.com, and restaurant delivery services delivery.com LLC and DoorDash.
In a six week beta test with all 10 of the apps, Ibotta app marketplace delivered a total of $1 million per week for in-app purchases to all 10 participating retailers, Ibotta says. The deep links from Ibotta to the retailer’s app had a 21% conversion rate, Ibotta says.
Groupon is making all of its local deals available to shoppers, which expands the audience for its offers, says Paul Koura, head of global affiliate marketing at Groupon. “This is about getting Groupon deals in front of as many shoppers as possible, regardless of where they’re shopping,” he says.
Integrating with Ibotta is in line with Groupon’s marketing strategy, as it has thousands of global affiliates that earn a commission by promoting and driving seals of Groupon deals, such as General Motors’ OnStar service and coupon aggregator site Ebates Inc.
Drizly is also looking forward to reaching new customers through Ibotta, says Nick Rellas, co-founder and CEO of Drizly.
“Drizly is available in 24 markets across the U.S. and Canada and is quickly expanding to new markets every month, which means we need to stay ahead of the curve when it comes to finding new ways to market our platform to consumers,” Rellas says.
Drizly’s marketing team and the Ibotta team started working together in the early summer, and the integration only took a few weeks, Rellas says.
Mobile technology provider Button is the company powering the app constellation. The tech company is responsible for deep linking, or connecting the apps to each other with a tap, and then attributing Ibotta if the connection resulted in a sale. Ibotta pays Button an undisclosed amount out of its commission, Leach says.
Typically within Ibotta traditional shopping app, a consumer finds a product rebate in the app, buys the product in a physical store, then takes a photo of her receipt in the app to verify the purchase and receive the rebate. The rebate is deposited into the consumer’s Ibotta account. Once she’s earned $20 in rebates, the money is transferred to her via online payment processors PayPal Holdings Inc., Venmo or into a gift card.
Ibotta launched in 2012. To date shoppers have earned more than $110 million in cash rebates, and the shopping app has raised $73 million in funding.Favorite