How often do you come across online couponing websites and think to yourself, “How do they even make money and generate revenue to continue their business model?”
This was a similar thought that plagued the minds of users of RetailMeNot. How does a platform that’s completely free of cost for the users generate steady revenue? We understand that this is extremely valid reasoning to have.
This article will hence explore in detail the RetailMeNot Business Model and how it generates a steady income to keep the website functional throughout the years.
What is RetailMeNot?
RetailMeNot is an online couponing website where shoppers can have direct access to coupon codes and cashback for the purchases, they make in different retail stores.
The platform was set up and founded by Guy King and Bevan Clark in 2006 and it later began its trading on NASDAQ on July 19, 2013.
The company was later delisted and then acquired by J2 Global on September 29, 2020, and has been under their ownership since then.
The website now offers access to over 500,000 effective and valid coupons for over 50,000+ retail stores and merchants, making the shopping experience for the users a lot more fun and valid.
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RetailMeNot History
Guy King and Bevan Clark founded RetailMeNot in 2006. They had launched BugMeNot before introducing this couponing website. Their ventures have served users save their money and protect their identities while using various web portals.
Whaleshark Media acquired this firm in 2010. It gained $300 million in funding from Norwest Venture Partners, Austin Ventures, Adams Street Partners, JP Morgan, Institutional Venture Partners, and Google Ventures.
RetailMeNot.com was a popular website that became RetailMeNot in 2013 when the acquisition was completed.
It went public in 2013 to raise $230 million. Harland Clarke Holdings (HCH) made a deal for $630 million in equity to acquire RetailMeNot.
The processes was completed in 2020, but the firm was again sold to J2 Global, Inc. In October 2020. The new owner paid $420 million to acquire this coupon-providing company.
How does RetailMeNot Works?
Now that you have a basic understanding of the website, its ownership, and effective choices, let us explore its operation. How does the website work in the first place?
For the users to access valid coupons from RetailMeNot, there are two ways the same can be done. The users can directly download the website’s browser extension known as Deal Finder to get the best deals and coupon codes automatically.
However, if you don’t want to download the extension, the next best option is to go straight to their official website. On the website, you will have categorized access to different coupons from different retailers.
You can manually copy the coupon code and apply them to the purchase you are making online.
Ideally, we’d recommend downloading and installing the extension because Deal Finder makes it easier for the users to find the best deals without any hassle at all.
Also, this model is quite useful when you don’t want to go to and fro from one website to the other while making your purchases.
RetailMeNot Features
Buyers consistently search for cost-effective shopping deals. E-commerce platforms always show that they are selling products at pretty affordable prices. They try to allure buyers by showing huge price drops and products are still pretty expensive for common buyers.
RetailMeNot offers a way to cut the cost of products and gain cash-backs on online shopping. The following features make it an excellent destination to find the best discount and cash-back deals.
Online Coupons
This platform has a huge database of online coupons. Buyers can access more than 400,000 existing and upcoming coupon codes daily. It provides a coupon to cut the cost of a variety of items.
You can find discount codes to buy items from many product categories, such as cosmetics, auto, books, apparel, sports, food & dining, travel, etc. You can also search online coupons for specific stores, such as DoorDash, Amazon, Target, Costco, Kohl’s, Sephora, and many others.
Printable Coupons
Buyers have been using printed coupons for many decades to get discounted in-store deals. A printed coupon assures that you will get an affordable deal to buy products from certain stores.
RetailMeNot is not popular for offering too many printable coupons, but you can still find some good online deals. Click on the coupon, check the available offer, ensure you are eligible for the deal, and then use it.
Download the official app of this couponing site and access in-store coupons as you visit the store. You can find some appealing discount offers on groceries, food, and other items sold at local stores.
Cash-back Rewards
RetailMeNot is well-known for its discount coupons. This platform also provides some cash-back rewards to loyal customers, who frequently use it for an affordable shopping experience.
This company claims that it has provided users with over $30 million via its cash-back system. If you want to use this feature, you will have to pay the full price of the product.
The coupon will provide information on how much cash-back you will receive and when you will receive it.
Deal Finder Extension
It was called RetailMeNot Genie in the past. Most users call it a deal finder extension that you can add to the Chrome browser to find the best shopping deals.
This extension manually scours the entire RetailMeNot database to discover coupons that may interest you. If you get this extension, it will automatically add coupon codes available on deals.
Thus, you won’t waste your time on finding the best deals and coupons to cut the product cost. It is beneficial for users who want to find affordable deals without wasting time.
Cash-Back Day
It is an event that RetailMeNot organizes in early November. It is a two-day event and all the loyal users wait for this event to get up to 20% cash-back on their shopping.
You can use hundreds of online stores to find high-quality products. Buy those products during this event and you can save a lot of money!
You can get 2-3 times cash-back from the original amount if you are a loyal RetailMeNot customer. Millions of users wait for this event because that’s when RetailMeNot provides the most impressive discount deals.
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How does RetailMeNot make Money?
Now, this is the question of the hour. How does a website that is completely free to the users, earns money to keep its business model functional?
You must be thinking that they probably run ads on their website but that’s not the case. No ads are running on their website.
Would you be surprised if we said that RetailMeNot has had over 650 million website visits in the last year? Users who have used the coupon codes from this couponing website have overall contributed to over 4.3 billion dollars in retail sales.
However, you must be thinking, “But, that’s what the retailers earn, right?” It is not like RetailMeNot earned 4.3 billion dollars that they helped sell items for. But, that’s where you are wrong.
RetailMeNot’s revenue model is entirely based on a commission system. This means that they earn a steady commission for every sale that they successfully help make using the coupon codes and discount codes that they offer their users.
So, even when they are helping users save a few bucks, they are earning from that.
Given the fact that RetailMeNot partners with 50,000+ retailers, it isn’t surprising that their primary source of income comes through the commission that they earn from these retailers.
When a user uses their purchasing link or a coupon code, they make a commission. It is a lot like affiliate marketing but without involving active promotions for the codes.
Why RetailMeNot is Such a Popular Destination to Find Discount Coupons?
This platform entertains millions of buyers for their affordable shopping demands. The following benefits attract users to RetailMeNot:
Low Redemption
RetailMeNot has a $5 redemption minimum, which is much lower than competitor platforms. Users have to gain up to $20 to use this feature if they want to apply for cash out. That’s not the case with this company and that’s why common buyers like it a lot.
Great Savings
This coupon-providing company offers deals on the most popular products. It does not force buyers to invest in cheap quality products to get cash-back deals. Buyers get the best deals on the best products.
A Huge Coupon Database
RetailMeNot has one of the largest coupon database. It can provide coupons to buy products on numerous online and offline stores.
This company provides discount deals in the USA, UK, and Canada. It became the first choice of millions of buyers due to the deals it offers frequently!
What is the Profit and Revenue Model of RetailMeNot?
Now that you have a fair idea about the income generation for RetailMeNot, we are sure that you are inquisitive about the website’s revenue model and the kind of profits they generate over the years. Well, you aren’t the only person with similar thoughts.
Although they do provide annual reports, having access to it might not be very easy. Let us take their 2016 annual revenue report as an example.
According to the 2016 revenue report, RetailMeNot generated around $280.4 million in revenue. This is an annual report, so it includes all the income, profits, and expenses that they indulged in 2016.
Looking at the figures, you should now be aware that RetailMeNot is not a small entity but a multimillion-dollar business model.
What is RetailMeNot’s Funding and Valuation?
Giving accurate information about the funding and valuation of a company can be difficult, especially because the revenue model is expanding regularly.
That aside, reports suggest that RetailMeNot generated its initial funding of $299.5 million throughout 5 rounds. The information was made exclusive via RetailMeNot’s Crunchbase profile.
Once the business was acquired by J2 Global in 2020, the takeover deal was valued at $420 million, which is a pretty hefty price or valuation for a couponing website.
What is RetailMeNot’s Business Model?
If it wasn’t a giveaway by this point, RetailMeNot has a combination of business and revenue models, including three primary factors –
- Commission-based
- B2B2C (partnerships) business model
- Mergers & acquisitions (M&A) business model
The business is a fast-growing and expanding business that is growing in valuation and importance in the market at an exponential rate.
Reports also suggest that RetailMeNot has made 6 subsequent acquisitions, including LowestMed, Giftcard Zen, Pickie, Actiepagina, Miwim, and eConversions.
Conclusion
If you were inquisitive about RetailMeNot and its business and revenue model, we hope this article gives you all the detailed insights that you need to know.
Remember that this is more than a couponing website, especially if the business’ valuation, profit models, and acquisitions are anything to go by.
Also, given that it is expanding at quite a faster pace, it is not long before the platform becomes a lot more diverse than you expect it to be.
