The last few weeks I have noticed that two of the major cash back sites started advertising on TV and Radio. Both site Topcashback.com and Quidco have been heavily promoting their products online for the last few years. Also relying on word of mouth and user recommendations by offering £5 to £10 to their users if they recommend their sites to their friends.The TV ads are very simple (to be honest to simple) and both try to explain their business model and the advantages within 30 seconds.They use logos and mentions to some of the big merchants in order to add trust and the fact that millions users use them already.[youtube]Mw_TWAgWBdo[/youtube][youtube]VO_hiirY_EM[/youtube]For TopCashback the final strapline is very interesting “besides, you’d have bought it anyway”. For the cosnumer this is great, not sure about the merchant. This is something we have been hearing a lot the last few months as merchants start to question the value of a cashback site!It's very interesting that both sites use TV but also Radio advertising at the same time. One explanation for this is that when we look at the traffic volumes we can actually see a drop in traffic for both sites during March-April. This is when Google released their Panda algorithm updated for their search index.

Topcashback.com

Quidco

Another explanation is that cashback sites are facing a stagnation, there are a few strong players, a few white-label solutions which makes it very difficult to acquire new users. Moreover users are not loyal as they switch websites depending on the best offer available! This makes it very difficult for the site but also for the merchants as they need to offer exclusive offers and as a result lower margins.