What’s wrong with this simple business plan?

(this post is a feed post from my comments on reddit)


reading your outline – firstly i think you can look at quidco and topcashback – both offer 100% cashback where their affiliate commissions are passed as savings in the form of cashback to their members who pay a subscription.

regarding combatting uses who game the system, thats typically done by only paying out the cashback after affiliate commissions have been received, affiliate commissions are then only paid out after the transaction has been completed and past the refund period.

as someone who spent almost 20 years in digital marketing with a focus on performance marketing (i started my career in affiliate marketing, now work in VC), i can tell you that almost all cashback, voucher code, loyalty programs and comparison sites are affiliate sites.

your idea is to try to make the cashback reward paid to the customer unrelated (unaffiliated) with the brand they are purchasing from – not the first time i’ve encountered this proposition – you’ll face the following dilemmas –

1. if the brand doesn’t pay the reward to the customer (for their unbiased review) who pays and why would they pay for it?
2. how will get enough brands willing to be in your network?
3. how will you get enough customers willing to be in your network?
4. how will you get networked customers to actually post reviews and frequently enough?
5. how will you ensure the reward to the customer exceeds the reward they might get elsewhere for less effort?

i think if you can resolve these dilemmas you will be able to progress.

What’s wrong with this simple business plan?
by inEntrepreneur

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