Giving your customers the opportunity to earn cash back on your online store is a great way to boost retention and revenue.

Cash back became a popular strategy with the creation of the cash-back credit card, but now the tactic has spread to online stores as a way to retain and reward customers. Cash back is a financial incentive that can also drive customer loyalty and boost your sales. 

In this blog post, we’ll explore five compelling reasons why your online store should consider offering cash back. Let’s dive in!

Key takeaways

  • Merchants should take advantage of offering cash-back rewards as a way to boost retention and revenue.
  • Cash back can help increase loyalty, as it incentivizes shoppers to keep returning to your store.
  • There are many tactics for offering cash back—giving customers the opportunity to earn cash in a variety of ways keeps them engaged and interested in your brand.

What is cash back?

To get started, let’s define cash back. It’s an incentive commonly used with online retail purchases and cash back credit cards where customers earn a percentage of money back after making eligible purchases. Cash-back rewards can then be used on purchases in the future, or in the case of a credit card, deposited into a bank account or sent via check or statement credit.

Cash-back credit cards

As mentioned, cash back became a well-known perk thanks to cash-back cards. They give customers the opportunity to earn cash back on grocery store purchases, retail stores, restaurants, and elsewhere. This tactic motivates customers to use their credit cards more, especially on everyday purchases, since earning cash back is such a strong incentive.

In the same way that a cash rewards credit card does, online stores can use cash back to motivate customers to continue shopping with them and spend money again and again to earn this reward. 

5 reasons to offer cash rewards to your customers

1. Attract customers

Cash back rewards are a powerful magnet for customers who are looking for ways to maximize their savings. By offering cash back on your online store, you can draw in new shoppers and turn them into loyal customers. 

Many shoppers actively seek out cash-back cards or cash-back programs to get something back from their spending. When they find out that your store offers cash back, they are more likely to choose your store over competitors, ultimately increasing your sales. Earning cash will make them happy and help you to create a community of loyal customers.

2. Incentivize customers to return 

By offering cash back on your store, you can encourage customers to return to your store continually. This tactic not only benefits your customers—by giving them cash-back rewards on some or all purchases—but it also boosts your sales. When customers see that they can get more cash back by spending more at your store, customer lifetime value (LTV) will increase.

Merchants like Bumpin Blends offer cash back as part of their rewards program, giving customers money off their next purchases. 

3. Encourage higher spending

Cash back rewards can also motivate customers to spend more on your site. Knowing that they can earn bonus cash or enjoy flat rate cash back with every purchase, customers may be inclined to add more items to their shopping carts. This can lead to higher average order value (AOV) and LTV, plus increased revenue for your business. It’s a win-win situation for both you and your customers.

4. Foster customer loyalty

Cash back rewards can significantly enhance customer loyalty. By offering cash back, you show your customers that you appreciate their business and are willing to give something back to them. This, in turn, can help build a stronger and lasting relationship with your customers. When customers feel valued and rewarded, they are more likely to return to your store for their future purchases.

5. Separate yourself from the competition 

With so many online stores vying for attention, it’s essential to differentiate your business from the competition. Offering cash back is a distinctive feature that can set you apart. You can even take it a step further by offering unique promotions such as: 

  • Double cash back days 
  • Special cash back deals during certain events
  • Unlimited matched cash
  • Cash welcome bonus 
  • Double cash back on popular spending categories 

Promotions and strategies like these can be excellent marketing tools to boost sales and customer engagement. Or, offer cash back on all your purchases so that customers know every time they spend with you, they’ll earn rewards. 

Optimize your efforts with Flows

To offer rewards like cash back, your ecommerce store can optimize workflows with Recharge Flows. Thanks to no-code implementation, you can use flows to carry out these powerful marketing campaigns, like offering cash back, without the need for costly or timely development resources.

You can also easily set up A/B tests to see which cash back strategies work the best for your customers—quickly test, iterate, and optimize your approach for the most success. 

Beyond the cash-back credit card: Offering cash back for your ecommerce customers

Cash back rewards are a compelling strategy to consider for your ecommerce store—and thanks to the popularity of cash-back credit cards it’s become more common for online retailers to offer cash back on purchases.

By attracting customers with cash back, encouraging higher spending, fostering loyalty, and setting your store apart, you can create a win-win situation for both your business and your customers. 

With the right approach, cash back rewards can be a significant boost to your online store’s success. So, why wait? Start implementing a cash back program on your store today, and watch your sales grow as your customers enjoy all the cash they receive as rewards.


[1] Cash back (Recharge ecommerce glossary)

[2] Flows (Recharge)

[3] The advantages of low-code development options in ecommerce (Recharge)

[4] Loyalty (Recharge)