How Flubit makes money from its demand driven marketplace

FlubitFlubit is described as a ‘demand driven marketplace’, offering a similar discounting service to Groupon and Living Social.

However, unlike these rivals who create a single deal for large groups of people with a common interest, Flubit creates individual deals for individual people, whenever they want it.

To create a deal, customers simply find the product they want online, visit Flubit and paste the link of the product into a search box. Flubit then works with its network of retailers and suppliers to provide the same product at a cheaper price.

Having found that nearly 80% of the product links submitted for deals were for Amazon, Flubit now focuses purely on providing better prices than Amazon – at the same time piggy-backing on the retail giant’s market range and dominance.

How Flubit makes money

Flubit operates as the middleman, linking the customer with the retailer and receiving a commission on each deal it facilitates.

By grouping together product requests, Flubit is able to negotiate bulk volume discounts with retailers for its customers and take between 2.5% to 6% commission.

The process works for all three parties, with customers getting a better price, retailers being able to sell products without advertising / promotional costs and Flubit earning a commission.

The table below is taken from the Flubit website and shows their top ten categories:

Flubit categories

A by-product of people entering their preferred products also means Flubit is collecting huge amounts of consumer insight on what products sell and to whom. This data will surely become a key revenue generating stream for the business in the future.

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