Paribus — gets you money back when prices drop

Paribus, a YC S15 company, let’s people get their money back on purchases when the prices drop at select retail stores. It does this when you allow it to scan your inbox for receipt of recently purchases items. Then it will automatically go out and get you a refund on the price drop.

Why is this appealing?

As humans, we are flawed when it comes to saving money. We are paralyzed by loss aversion, which tells us that the pain of losing is psychologically about twice as powerful as the pleasure of gaining. The loss that we are talking about here is the loss of money or not full actualizing the “value” of a purchased product. For example, individuals sometimes order too much food and then over-eat ‘just to get their money’s worth’ (sunk cost fallacy).

We have shows like Extreme Couponing to publicly traded companies (Retail Me Not) to hardcore savings advice, all which show you have to save and save big. All sell the appeal that you can save to millions. But that is extremely flawed.

The Way

As the massively entertaining James Altucher reveals that saving is actually flawed.

People might think this is flippant. What if they can’t make more money. Well, then, you’re going to run out of money. No personal finance rule will help.
Buying coffee on the street instead of in a Starbucks is the poor man’s way to get rich. In other words, you will never get rich by scratching out ten cents from your dollar.
People save 10 cents on a coffee and then….overpay $100,000 for a house and then do reconstruction on it.
Or they save 10 cents on a book and then…buy a college degree that they never use for $200,000.
Now your real education can begin:
A) Don’t save money. Make more. If you think this is not so easy then remember: whatever direction you are walking in, eventually you get there.
B) That said, don’t spend money on the BIGGEST expenses in life. House and college (and kids and marriage but, of course, there are exceptions there). Just saving on these two things alone is worth over a million dollars in your bank account.

What is Paribus’ game plan?

So you still want to save dollars on your purchases? Great. So you allow Paribus to scan your inbox for your receipts. And you even might have saved a few bucks on your last Amazon purchase. Feel nice?

Now what does Paribus have on you?

In 2016, online shoppers are predicted to spend $327B and web influenced offline spending will hit $1,660B.

Bazaarvoice_WP_Top5_Consumer-Driven_Trends_Retail.pdf

Of all those transactions, your receipts will be hitting your inbox. Therefore, Paribus will be able to see and analyze all of your consumption.

What can it do with this information?

Paribus can take several avenues with this approach. The first is creating the MOST HYPER TARGETED COUPONS/PROMOTIONS EVER. Retargeting is one thing, where an online store knows you looked at an item and it will follow you around the internet for a while. What is more effective is “PRETARGETING (tm)”. Pretargeting is when Paribus knows that you buy shaving cream every 2 weeks or book a family vacation every March or knows that your car lease is expiring soon. It will serve you with an amazing promotion to something you were bound to get eventually.

The value in that model is that Paribus becomes the most valuable piece in the sales funnel because it delivers a person to a business and know exactly how much that person will be transacting on. Here is a clip of Chris Sacca (circa 2011) talking about how important it is to be “closest” to the transaction:

The second avenue it can take, based on the data that is collects on millions of people, is to transform into an etailer. This “store” would sell products or services that is popular with a certain population.

The third avenue is selling the data to whoever wants to buy it. Whether it would be buy side institutions or for competitors of a certain brand, incredible findings can be unearthed in the data.


The way retailers used to keep tabs on their shoppers used to be through offering store credit cards.

Now there is no reason to open up a facade of a brick and mortar store — you can do it just by playing into elementary behavioral economics.



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