How does cashback work?

Holiday

I don't mean the physical bit of claiming it.....that is straightforward if you follow the rules...

No I mean the relationship between the Telco and CPW, E2Save, Simply3G etc etc.

I am currently on a 12 month contract where I was given a new phone and if I follow the cashback rules and do not exceed my monthly allowance I will have a years service for nothing.

How does anyone make any money there?

trippy

I think there are more people who forget to send off their claims than remember. So they make their money from them. Then at the end of the minimum contract people forget to move or can't be bothered.

melipona

According to this site 50% of cashback is unclaimed!!

Also one of the ways a mobile company is valued is by its customer base so by offering an introductory discount or a loss leader they hope the customer will stay and they can make their money back plus.

Many types of business use this tactic, car insurance is almost always cheaper if you change company every year and supermarkets often have deals to entice you through the door in the hope you will buy something else.

But they reckon without canny people like you and the rest of MSE users who cruise through picking up the offers but resist the temptation to be sucked in to spending more, and long may it continue.