What is Rakuten? Rakuten is a company, formerly known as Ebates, that gives you cash back for shopping through their affiliated stores. Rakuten has relationships with thousands of stores and offers discounts or cash back when you shop at these stores through Rakuten.com.
Confused? I was too.
You might be wondering, “Is Rakuten a scam?” If you didn’t have questions, you wouldn’t be on my blog looking at an Rakuten review.
I’ve been using Rakuten (Ebates) since 2011 and have made over $800 in cash back during that timespan.
My biggest payday from 6 years ago (when the site was called Ebates):
My cash back from last few months:
I’m going to show you how to use Rakuten, why the system works, and why you should be using it.
$10 Bonus Link
How does Rakuten work?
If you don’t understand business or business partnerships, it might sound too good to be true. But it isn’t. Rakuten is legit (not a scam), and you should be using it every time you shop.
The process is simple.
You (the customer) go to Rakuten.com, search for the store you want to shop at, click the “shop now” button, and shop at the online store (as you normally would). Once you’ve made a purchase, a percentage of the purchase shows up in your Rakuten account.
If Rakuten offers 10% cash back for shopping at Target and you buy something for $500, you’ll get $50 in cash back.
If you’re still confused, check out the walkthrough video I made on how to use Rakuten.
How does Rakuten make money?
You’re probably asking yourself, “How can Rakuten give you money for free? What’s their business model?”
You need to understand how affiliate marketing works to understand Rakuten’ business.
Affiliate marketing is a business model where companies (i.e. online stores) pay people a commission for referring sales.
Rakuten is an affiliate to over 2,000 stores. When someone clicks on an Rakuten link to a retail store, Rakuten gets a commission.
Rakuten gives you half of their commission (via cash back). This is a win-win-win. The store gets more sales. Rakuten makes a commission. You make free money just for shopping.
Example: You go to Rakuten.com and click through to the Best Buy store. You buy a MacBook from Best Buy for $1,000. Rakuten gets a 4% ($40) commission from Best Buy for referring the sale. Rakuten give you half of their commission ($20) in the form of cash back.
You may wonder if this approach really increases the stores’ sales since customers could make purchases regardless of Rakuten’ existence.
Here’s my take: the stores would opt out of their deal with Rakuten if they didn’t think it was helping their sales. Here’s the store’s logic: because the customer is saving money, they will be incentivized to spend more money.
How long does it take Rakuten to register a purchase?
Once you click through to your store of choice and make a purchase, the cash back will show up in your Rakuten account within seven days.
Once your cash back has been in the account for 60 days, you’ll get paid via PayPal on the following dates: February 15, May 15, August 15, and November 15.
My cash back didn’t show up during two purchases this year. I’m not sure why this happened. But if it happens to you, go to this page and fill out the information. Once you do that, the money instantly appears in your Rakuten account.
Five Tips to Maximize Earnings:
- Check Rakuten for coupons before you check out. Not only do you get cash back from Rakuten, they have coupons for most of the stores too. Coupons help you double down on your savings.
- I used to forget about going to Rakuten before buying something. If you don’t go to Rakuten first, there’s no way for Rakuten to track your order and you won’t get cash back. This is where the Rakuten browser extension comes in. The Rakuten button will sit at the top of your window, and when you visit an eligible store, a message will pop up that says “Activate Up To __ % Cash Back”. Click on the button, and you’ve created the tracking ticket needed to track your order. You don’t even need to visit Rakuten.com.
- For years, the only way to get cash back was to shop at online stores. Last year, Rakuten introduced offline cash back. You go to the offline cash back page and link your credit card. After you link your credit card to your Rakuten account, find a store you want to shop at and click “link offer.” When you tie the offer to your card and buy something at the store, the cash back posts to your Rakuten account. This feature is fantastic!
- If you’re using an ad blocker, you should whitelist Rakuten.com. Rakuten doesn’t work well with ad blockers enabled.
- Try to make your purchase within 24 hours of clicking the Rakuten link. You’re normally given 30 days; but play it safe and reclick the link!
- Rakuten is free. I’ve been a loyal user for eight years (back when it was called Ebates). Ebates.com moved and been rebranded to Rakuten in the spring of 2019. Nothing changed (confirm for yourself). All the previous Ebates accounts were moved to Rakuten.com with the same interface and features.
- Obviously, I love the fact that you get cash back for doing absolutely nothing. You shop online like you normally would and buy the things you normally would. The only difference is clicking a link before you shop and making some extra cash. I normally make around $200 a year in cash back. Below is a screenshot of my earnings from last quarter.
- Rakuten came out with “in-store cash back” a couple years ago. This applies to a limited number of stores, but it’s still a great feature. Go to the in-store cash back page, click on the store you’re going to shop at, and link your credit card. Afterward, all of your purchases will show up in your Rakuten account and you’ll get receive cash back.
- We’ve all scoured the internet for coupons before checking out online. But Rakuten streamlines the process so you don’t have to waste time testing coupons that may or may not work. Their goal is to be the one-stop shop. You can search for coupons and get cash back at the same time, allowing you to get double the savings.
- In the early days of Rakuten, you had to go to Rakuten.com before you made a purchase. But now there’s an Rakuten button plugin for all the major browsers, so you won’t forget to use Rakuten. With the browser plugin, there’s a cash back button at the top of any eligible site you visit. All you do is click the button and it creates a tracking ticket for you, then you can shop as usual.
- They have a refer-a-friend program (I’m in it). They give $5 for every new member who signs up for Rakuten and makes a $25 purchase. This gives their diehard fans a chance to make more money, a smart marketing tactic.
- I’ve spent $40k on Amazon over the last seven years (find your Amazon.com spending total here). Amazon is where I buy everything and all my products to review. But unfortunately, only a few categories on Amazon are eligible for cash back. Amazon might as well not be an option because the current categories are Amazon Devices, Furniture, Jewelry, Luxury Beauty, Handmade, and Home Services. I don’t buy products from these categories. I would love to get cash back for all my tech purchases! This isn’t an Rakuten issue though, so I don’t blame them.
- The cash back percentages are always changing. I’m not sure if Rakuten does it for marketing purposes (to promote certain stores), deception, or because their affiliate deals with the stores change often. It’s annoying to see to see a different cash back amount every time you sign in. BUT, we’re talking about FREE money, so it’s tough to complain.
- Sometimes the tracking tickets (the thing created when you click their link) don’t always work like they’re supposed to. If this happens, fill out this form and your cash back will automatically appear in your account. It’s an annoying extra step, but it’s not a huge deal. My problem is when you have to talk to customer support. They’re not always the most supportive or competent.
- The cash back is posted in your account within a week, but you’ll only get paid out via PayPal every three months (February 15, May 15, August 15, and November 15). Rakuten does this to avoid someone buying an item and returning it to the store (Rakuten would have their cut stripped by the store) and if Rakuten already paid out to you, they’d be at a loss.
$10 Bonus Link
Who is this for?
Rakuten is free and will never cost you anything, so you can only benefit from using the site. You shop for something you would normally buy and then get money back in return.
If you don’t shop much online, Rakuten might not be for you. Let’s say you only spend $20 per month online. With an average cash back rate of 5%, you’re only looking at $1 cash back. Is it worth your time? Probably not.
For me, I spend thousands on electronics and buy lots of web hosting accounts (hosting accounts give around $20 in cash back), so this makes Rakuten worth my time. As I mentioned before, Rakuten has sent me an extra $800 for just clicking their links.
Just so we’re clear, people can’t make a living off Rakuten and shouldn’t buy things they don’t want on the site. Think of Rakuten as a way to take home some side money.
See the annoying red “try now” buttons on this post? If you register on Rakuten through MY link, you’ll get a $10 bonus from Rakuten.
What’s in this for me? If you sign up via my link and make a purchase of $25 (through Rakuten), I’ll get a $25 commission from Rakuten. This decision costs you nothing yet provides me with a commission. Don’t want to use my link? That’s cool; but I appreciate it if you do.
I wrote this review because not enough people understand how cash back works, and I want to change that. It’s a great system that benefits everybody. You’ve got nothing to lose!