It pays to shop

Hey there, time traveller!
This article was published 21/12/2019 (2375 days ago), so information in it may no longer be current.

Darris Gross is among the millions of Canadian consumers shopping this holiday season without setting a snow-encrusted boot inside a shopping mall (or at least they’re doing so far less than in the past).

Her preference is to shop online, and she’s far from alone.

A recent Deloitte study found six in 10 consumers surveyed will shop on Amazon this season, let alone all the other e-commerce options.

Indeed, Gross is among those exploring virtual aisles of Amazon. As well, she counts herself among the ranks of Shopper Army.

“The idea behind it for me is that it’s just free money,” the Winnipeg massage therapist in her 30s says.

Wait a minute. Isn’t she spending money on purchases?

Well, yes, that’s right. Gross is shopping online, only she’s doing it through a cash-back site: Shopper Army.

“It has a lot of the stores that I shop at… some that Rakuten doesn’t have.”

If “Rakuten” is also Greek to you, you’ve likely been missing out on a trend among online shoppers using rebate websites offering cash back when making purchases at popular retailers like Amazon and Walmart.

Cash rebates are hardly new, nor is going online to get them. But sites like Shopper Army and Rakuten (the “Amazon of Japan” that purchased the popular cash-back site Ebates in 2014) are growing in popularity because they make rebates easy.

Consumers sign up through one of these sites — made easier if they have a Google or Facebook account — and then they click on links to the stores they want to shop at, each one offering a cash-back rebate on purchases.

According to Bloomberg News, Rakuten’s Canadian site, rakuten.ca, reached five million users earlier this year, providing cash-back shopping at e-commerce sites for Dyson, Lenovo, Indigo and Hudson’s Bay. The number of sites is in the hundreds.

As well, options are plentiful in Canada, including Shopper Army, Ampli and Great Canadian Rebates — to name a few — and for good reason.

“They’re a really easy way to get a little extra money,” home economist and former debt counsellor Christi Posner says.

The Winnipeg mother of three and blogger (christiposner.com) has been using Rakuten for the past year, upcoming holidays included.

“I already shop at Amazon all the time, so this is just a great way to stretch my dollars a little bit more.”

Rebates typically range from one to five per cent. But occasionally, the cash rebate can be as high as 10 per cent on special purchases.

Individuals typically receive payments quarterly via cheque, direct deposit or via PayPal.

The money can also be used on the rebate site to shop more, including buying Christmas gifts at participating stores, which of course results in more rebate money.

That’s not, however, what Posner does. She puts the earnings toward savings goals.

“In the past, I’ve saved for maternity leave because I’m self-employed.”

These days, money goes into the family’s new-vehicle account.

Additionally, rebate sites users can earn more cash for referring a friend, who then must sign up and make a purchase. The bonus is generally $5 per referral, which can add up if you have a lot of friends, Posner says.

Another way to amplify savings on purchases is to stack cash-back rebates with other offers, says Stephen Weyman, founder of howtosavemoney.ca.

“Start with a good sale price on the product you’re interested in buying by doing a thorough internet search, using price-comparison websites,” he says. “Remember, some online retailers have price-match or price-beat policies along with free shipping deals.”

So if you can find an identical product on another site at a lower price with free shipping, you can get the price down even more with the e-commerce site offering price matching.

The next step is looking for discount coupons that apply at checkout. Online options are plentiful — like coupon sites and deal forums, for example. A good tip is to look at the cash-back sites themselves because they often list coupons.

A note of caution, he adds: “Occasionally, coupons found on other sites can invalidate your cash back.”

Weyman adds the extra effort is worth your time, given many coupons do qualify. Another step is adding your rewards-program number — i.e. Air Miles. And last, use a rewards credit card for extra cash back or points.

So in the end, that initial purchase made at Walmart through Shopper Army can add up, far beyond the one per cent cash rebate.

All the potential savings aside, Posner suggests only using these sites when you actually need to purchase an item.

“I don’t go browsing on Rakuten without a reason, because otherwise, I will find things like Home Depot offering 10 per cent cash back, which might lead me to spending money I wouldn’t have spent otherwise.”

Research backs Posner up. A 2018 study from the Tuck School of Business at Dartmouth College in the U.S. found cash-back sites boost consumer spending after an initial purchase because of our natural inclination to spend more when presented with deals.

For Gross, however, her greatest challenge with rebate sites isn’t overspending. It’s remembering to use Shopper Army when buying online.

“I’ve been getting much better at remembering to open it up to use it to make purchases.”

It’s a win-win, she adds.

“If you’re using it, great — you get bonus money — and if you’re not, you’re not losing out on anything.”

Well, except for perhaps for a little extra cash in your bank account.