“If anyone actually knows what Flip is, and how it works, and how they give hundreds of dollars of free products to everyone, please let me know,” says 21-year-old TikTok user Alexis Taliento. She then opens a package containing $74 worth of products from Sephora-grade beauty brands like Saie and Anastasia that cost her just $4 out of pocket. “I will gladly take the free makeup,” the New York City–based college student tells her 30,000 followers.
Taliento’s experience isn’t a one-off. Flip, a social video platform fixated on shopping has recently blazed a trail of confusion-tinged-delight across the internet. A referral program that rewards users with next-to-free merchandise has helped propel the platform into the top 25 most popular free US shopping apps on the iPhone, according to SensorTower—while sparking questions about the business model behind it.
Flip tries to channel the shopping culture of TikTok and Instagram into a space wholly dedicated to purchasing and reviewing products. Humans Inc, the startup behind Flip, has raised $95 million in funding according to investment analysts Pitchbook, and in October it launched a generous referral program awarding users up to $150 when they refer a friend to the platform who subsequently makes a purchase. The new user of the app gets a gift card of equal value, which can be used to cover 95 percent of the cost of any product on the app.
Beyond the referral program, the basic here-to-stay design of Flip also offers users monetary rewards. Users receive additional credit, including cash directly transferable to their bank accounts, if they review in-app purchases in the form of TikTok-style videos—whether or not they have good things to say about what they bought. Flip pays creators when their videos receive views and reactions, when other users buy a product via their review, and when they view and react to those of others.
Flip works directly with brands to approve their license to sell on Flip, and it lists notable labels including kitchenware maker Caraway, appliance brand Smeg, and hair-care giant Moroccanoil. Brands are barred from communicating directly with users, but they can pay the platform to promote particular reviews, generating ad revenue that Flip shares with the review’s creator.
To the internet-trained eye, messages containing $100 gift cards accompanied by bright green “Claim Now” buttons are undeniably suspicious. But the lure of subsidized purchases is helping to transform wary prospective users into avid, albeit sometimes confused, Flip shoppers.
Clare Walker, a 23-year-old in Brooklyn, has racked up about $700 worth of gift cards or, in her words, “free money,” by referring her contacts to Flip. “There were definitely some people who I haven’t really kept up with since high school, but I was like, ‘Hey, add me on Flip. Here’s a free 75 dollars, enjoy,’” Walker says. Her purchases on Flip include JBL wireless headphones, a variety of luxury skin-care products, and a live houseplant.
Noor Agha, CEO of Flip’s developer, Humans Inc, says his product’s sudden popularity renders Flip “one of the fastest things that ever happened in ecommerce,” although he declined to share even a ballpark estimate of the size of his user base. He claims to have made the first platform “built for brands only” and rejects the suggestion that cash-incentivized referrals are driving Flip’s rise or are essential to its survival.
Agha argues that by allowing anyone to monetize their reviews, while barring users from directly working with brands as influencers usually do, Flip should foster a more genuine community around commerce than can its established rivals.
“Everybody can earn. It is not by selection of somebody at Flip,” Agha says. He claims that his platform’s design is guided by the question “How do we bring honesty and authenticity to commerce?”
But his recipe for authenticity isn’t foolproof. The prohibition of brand-to-creator interactions may prove difficult to enforce, as brands are accustomed to working with influencers. After her in-app reviews began gaining traction, Collier Barksdale, a 25-year-old Flip user in New York City, was contacted by a beauty and lifestyle brand on Instagram. In a message seen by WIRED, the company offered to send product samples in exchange for Flip reviews. Barksdale did not accept.
And Sky Canaves, a senior analyst of retail and ecommerce at Insider Intelligence, a digital market research firm, questions whether Flip can hold on to the users it’s winning through the current giveaways. “The company is engaged in a very expensive customer acquisition strategy,” she says—one that may be necessary to lure people from platforms like Instagram and TikTok, both of which have added shopping features. “If Flip stops meeting expectations around these types of compensation, then there’s likely to be some pretty significant departure of users.”
Canaves also says it’s unclear whether people will find value in an explicitly consumerist social app. “It’s kind of like all of the TikTok shopping content without any of the real entertainment that you get on TikTok from the professional creators and celebrities,” she says. Social shopping has proven more successful in China, Canaves says, where trust between consumers and brands is generally lower than in the US, leading people to rely more heavily on peer-recommended products.
Taliento, who uses TikTok both socially and to post sponsored content, says Flip’s shopping-forward design minimizes its appeal as a social destination. “I personally don’t really have any interest in interacting socially on the platform,” she says, calling the app’s social atmosphere “Amazon on steroids.” Within Taliento’s social circle, use of the app has so far been limited to the accumulation of referral credit.
For some who have harvested close-to-free goods from its referral program, confusion surrounding Flip can veer into apparent paranoia. In a TikTok with the seemingly hyperbolic caption “need someone to calm me down its haunting me,” user @bitchybearz expresses her skepticism regarding the app’s too-good-to-be-true deals. “Obviously, I’m pretty shook, because nothing happened and I’m safe, and I’m OK, my house hasn’t been infiltrated yet, and I haven’t been kidnapped, so that’s amazing,” she says in a video posted in October. “But does that mean, you know, that I won’t? Like, am I safe?”
Performative reactions to Flip’s discounts—whether expressing doubt over the app’s legitimacy or excitement over their all-but-free merchandise—have a viral life of their own. And all posts luring attention with discussion of Flip’s deals can help propagate the app’s growth. “I got all this stuff for free, so keep watching if you want free stuff too,” TikTokker @sierra.sperle says in a video—which hosts a comment section filled with requests for referral codes.
Agha acknowledges that his app’s rewards can strike some as scammy, but he expressed confidence in the long-term sustainability of his product. His company is working on a new round of funding that will be, he says, “something insane,” potentially providing more fuel for the referral program.
For now, his customers are basking in the impossibly low prices while they last. “Best $3 I ever spent,” Barksdale captioned a TikTok in which she spends the next five minutes opening up Flip packages before ending by panning over her haul, overlaid with text reading “MERRY FLIPMAS.”
Source : Wired
