Like many countries in the region, Thailand has got the serious hots for e-commerce. Recently, the Thai tech ecosystem has seen significant investments in e-commerce solutions; been a test bed for new e-commerce solutions; and in 2015, logged a whopping US$9.8 billion in retail and wholesale e-commerce products.
Yet, despite this optimistic forecast, a relatively common e-commerce product — the cashback model (a US$84 billion dollar industry) — has yet to take off in the country.
For the uninitiated, cashback websites allow costumers to receive cash rebates whenever they purchase products through the site.
These rebates come from the commissions merchants pay to the cashback sites every time a product is sold. For example, if a cashback site earns a 5 per cent commission from the merchant, 1 per cent of that goes to the customer in the form of rebates.
Besides rebates, some cashback sites might explore other revenue streams such as advertising.
Recognising this untapped business opportunity, Three Thai-Americans who have collectively founded startups such as e-commerce platform Galleon and sports platform Bangkok Bobble Football, roped in a partner from France to build Thailand-based cashback startup Dealcha! in late 2015.
One of the co-founders Danny Chang, tells e27 that Dealcha! has already partnered with more than 100 major stores in Thailand such as Lazada, WearYouWant, iTrueMart and CDiscount.
With similar cashback platforms such as ShopBack already present in neighbouring markets such as Singapore, Indonesia, Malaysia, Philippines and India, Dealcha! may face fierce competition if ShopBack decides to pour resources into winning over the Thai consumer (which would make perfect sense considering the eye-popping e-commerce potential as mentioned earlier).
But Chang says that Dealcha! has the advantage of hyper-localisation — which is a common obstacle many foreign startups face when attempting to penetrate regional markets especially non-English speaking ones.
Dealcha! is also aggressively pursuing partnership opportunities to provide better cashback benefits, as well as implementing several new e-commerce features including a mobile app — though he declines to disclose further details.
Chang says the growth rates have been promising. Dealcha! has been experiencing 30 per cent Month-on-Month growth in users.
The startup has been bootstrapping since its founding, but Chang plans to raise a seed round in the near future. He is currently in talks with local and foreign VCs.
Regional expansion is on the cards but no concrete plans have been drawn up yet.
Since the cashback model is not an entirely unique value proposition, all Dealcha! can currently bank now its first mover advantage in the local market.
But, like all startups, change is a part-and-parcel of a company’s lifecycle: the product often goes through several iterations, adapting to market trends and other factors including competition.
So, let’s wait and see what Dealcha! can dish out in the future.