The app charges a 7% commission on every transaction and makes money through an affiliate marketing rev share program with some of the online retailers that make their merchandise available on the platform, including Amazon, Best Buy and eBay. Grabr is in the process of setting up affiliate relationships with Abercrombie & Fitch and B&H Photo Video.
Although Grabr has flirted with the idea of rolling out promoted products, it’s not considering an ad-based model because it doesn’t want the app doesn’t feel too commercial.
“I don’t see how monetizing with advertising would fit into the user experience,” Rebenok said. “And for us, product and user experience are the most important things.”
Since launching in July, Grabr has garnered 85,000 users, roughly 70% of whom are shoppers, which is why it’s now focused on acquiring more travelers to even out the ratio. A P2P marketplace only functions if there are sufficient numbers of users on both sides.
Grabr has run experiments with paid user acquisition campaigns across social media – Facebook in particular – and dipped its toe into native content. But the best acquisition channel has proven to be its existing user base.
“A lot of our user growth is stimulated organically,” Rebenok said. “And once people see how the app works, they stay. There’s a viral effect. They tell their friends about us.”
That’s partially thanks to a referral program that doles out cash and in-app credit for recommending the app. Grabr is also working on building relationships with travel bloggers, airlines and online communities for flight attendants to get the word out.
The app isn’t looking for one-off engagements, Rebenok said.
“It’s really important to us that people aren’t just using the app once – we need repeat customers to make this sustainable,” she said. “We study user behavior closely to see what we can do and what features we can build to keep users hooked.”
Grabr is tracking everything from which categories and products are popular to basket size, average order size, travel patterns and purchasing trends in different regions of the world.
Beyond informing features within the app, that’s also data that Grabr could potentially sell to retailers and brands that are trying to figure out where they should increase or decrease their market presence.
The attention to detail is bearing fruit. Three out of five of its users place a second order after their first engagement with the app. Since July, around $800,000 worth of goods have been delivered through Grabr.
There remains an initial challenge, though, in getting people to understand that the service is safe and reliable.
On Grabr’s FAQ page, travelers are advised to look up applicable custom fees before traveling and do research to make sure that whatever item they’re being asked to bring isn’t illegal or prohibited in the destination country.
“There is more demand from shoppers than supply through travelers right now, because there are just more things that the traveler needs to do,” Rebenok said. “It’s our job to educate travelers that this is easy and that it’s a good way to make some money.”
And a way to help people get their hands on otherwise inaccessible goodies. A lot of shoppers are looking for conventional items, like electronics, handbags, candles, candy or makeup, and over December, Grabr noticed an uptick in asks for iPhones, iPads, Google Pixel Phones, Legos, plush Minions and Burt's Bees, many of which are likely destined to be gift items.
But others have delightfully bizarre requests, like churro-flavored Oreos from São Paolo or Voodoo Doughnuts from the flagship store in Portland.
“A lot of people in Southeast Asia and Russia order baby formula from America because Similac isn’t sold where they are, and there was one guy who ordered sand from a particular beach in Bora Bora because that’s where he went for his honeymoon and he wanted to give it to his wife for their anniversary,” Rebenok said. “That all fits with how we like to think of ourselves, which is as a global logistics company that can help you find the items that are really hard or even impossible to get online.”
This is the ninth installment of Home Screen, a series of profiles on mobile pubs and apps and the devs who make them (and hopefully make money on them). Read about home décor app Lux, teen voting app Wishbone, wedding planner platform The Knot, lip-syncing app Musical.ly, pop culture magazine Movie Pilot, news app News Republic, laundry startup Cleanly, music streaming app LaMusica, kid-friendly chat app Jet.me, driving app Dash, anonymous app Whisper, storytelling app Episode, weather app Poncho, online writing community Wattpad and sticker app Emogi.