Loyalty Stories 21: Build With Purpose, Stand Out With Strategy – Luke Saville

Gabor

Hi and welcome to Loyalty Stories, that is Antavo’s podcast on customer loyalty and loyalty programs. I am Gabor Vigh, one of the Partnership Managers at Antavo, and Antavo is a technology vendor that empowers loyalty programs all over the world. We have various great businesses such as KFC, Benefit Cosmetics, and very well known global automotive brands and fashion companies, and airports and so on. 

In this Loyalty Stories podcast, we dive into the trends around loyalty programs and customer loyalty. We talk with industry experts around the world to pick their brains to learn what’s new and what’s next for loyalty programs. Today’s guest is a returning contributor to the Loyalty Report for Antavo, and also one of the first loyalty professionals who completed the Antavo Academy and became Antavo certified.

Luke Seville from Stedion. Stedion helps brands to unlock growth opportunities through strategic marketing solutions and technology implementations. With expertise in customer data, loyalty programs and personalization, they enable their clients to achieve their goals and drive long-term success. 

So, hi Luke, how are you?

Luke

Doing well, Gabor. Thanks for having me.

Gabor

Thank you very much for joining us. Would you mind quickly introduce yourself for our audience?

Luke

Sure. Yeah. So my name is Luke Saville. I’ve been in the loyalty space for about 10 years now. I used to work at one of the loyalty technology software companies in the space. And that was where I got first got exposed to it. And I was really fascinated by the scale and complexity of loyalty integrating across all of these different purchase channels and marketing channels.

And so I was just really fascinated by that. And there’s also a huge ability to move the needle and drive additional revenue, for brands. So I really enjoyed the space. And as I got further into it, I realized that a lot of the value of programs is unlocked through the implementation side of things and the actual services of both the program strategy, though, you know, kind of, why the program should exist for a brand, mapping it to the brand values and kind of the brand tone of voice with the customers. 

And then also doing all the integration work, the heavy duty in the weeds, integrating, doing API driven integration between all these different systems to actually get purchase data, feeding through the rules, triggering the communications, triggering the customer’s points, handling the discount of rewards and things like that. 

So, I moved my career over into the services area, and started a company just focused on loyalty and marketing automation, trying to solve those challenges that I just laid out. So that’s what I do every day. And that’s what, my company is Stedion on does every day.

Gabor

Great, thank you. Now that you have been exposed to loyalty for quite a while now, what is your favourite program and why?

Luke

So I’m a little biased on this, but, my favorite program is the Starbucks program here in North America. I know that Starbucks has different regions. And so I can’t really speak to what they’re doing over in, Europe or Asia, but in North America, I’ve been heavily involved working on that. And I think that they just do a really good job of, making the program very simple, very easy to understand for the customers, which I think it creates a sense of honesty with the customers. 

If you can just look at it and within 10 seconds, completely feel like you understand it and you understand the benefit back to you, then I think you’ve done it right. I think a lot of brands kind of go too complex and just kind of keep piling on, oh, we should do this and we should do that and we should have a reward store and we should have you know, manufacturers, coupons, and we should have our own in-house promotions and we should have stored value.

And it’s just, it just gets too complex. So I think Starbucks has done a really good job of keeping the program very simple and very focused with a clear value exchange of the customer. And I think, you’ve done a really good job around, personalization. So, making the offer is really relevant to the customer. So they have a base program of you earn two stars for every dollar you purchase, every dollar product that you purchase at 200 stars, you get a free drink menu item. 

And then on top of that, you have these opportunities to earn additional bonus stars through star dashes and star streaks, where it encourages the customer to come in multiple days in a row, or buy particular products off the menu.

And these are always tailored for each individual customer, either through segmentation or through in-house data science models that they’ve built that optimize and create these one-to-one offers. So any given week, there might be tens of millions of customers getting these, offers and, every customer will get an offer that is relevant for them, and is intended to drive some outcome of incremental revenue of increased spend for those customers that week, cross-selling to other products or upselling to more expensive products. 

Then they have a very good measurement pipeline of being able to evaluate, you know, how successful each of these offers was. So I think that they’ve got a very mature program, but they’ve done a really good job of keeping it simple.

Even, you know, looking at their app experience, you know, almost everything you touch in the app puts you back into the order flow. You know, that’s another thing that I think some brands can get a little bit confused about the purpose of their app or the purpose of why customers are using their app. And so a lot of brands will have just tons of, you know, campaign content and, you know, videos and all these different things.

It kind of takes away from, okay, but, but why is the customer coming to this channel and for Starbucks it’s to buy coffee, right? And so almost anything you touch will push you into a purchase journey for coffee, in a good way, because that’s why customers are opening the app is to buy coffee, not to, you know, you know, learn more about trees or whatever. So they’ve done a good job of keeping it very purpose built. So that’s my favorite.

And then kind of second favorite is just generally the airline industry. And I’m not going to necessarily pick favorites because I think across the board airlines have done a very good job. So I’m not going to name drop any particular. But I think in general airlines have done a really good job of cracking this problem as well is, you know, they have a lot of different benefits that they can offer customers.

And I think they’ve done a really good job of having these very tangible benefits that are very meaningful for the customer and frankly, probably don’t cost a lot of money, for the airlines themselves to be able to execute things like moving you from a seat in the back of the plane to a seat in the middle of the plane, or moving you from the middle of the plane to almost the front of the plane or from almost the front of the plane to the very front of the plane and having, you know, big comfy seats and getting free drinks or free food or free wifi free checked bags. So they’ve just done, you know, getting to board first. 

They’ve just done a really good job of layering in all of these additional benefits that lock you in as a loyalty customer that you wanna keep your tier and your status because you don’t wanna lose, being able to sit, you know, being able to board the plane first and be able to sit at the front of the plane, you always will book that same airline. So they’ve done a really good job of capitalizing on that.

And yeah, so I think those are the two that I always come to mind and I always try to keep in mind when I’m advising clients on the types of programs that work for them. Those are, I think, our good North Star examples in the loyalty space.

Gabor

Great, thank you Luke. I think a lot of loyalty experts, awe of the Starbucks loyalty program in general, at Antavo we have done a program analysis on their loyalty program recently as well. So I understand why you picked them. 

And also because you worked on the implementation and on that project, would you consider this one of your most favorite or that kind of work that you’re most proud of or do you have someone else in mind?

Luke

Well, you know, assuming they’re watching this, I say, yes, they’re the most proud of, no, but I think, I probably won’t say maybe a specific name. I don’t know. I, I have, I’ve worked over, I’ve been involved in some capacity in launching over a hundred brands, loyalty programs, over the past 10 years, and so I’m kind of proud of that impact is, kind of everywhere I go, I’m interacting with a loyalty program that I had some sort of a hand in getting off the ground. 

And so I’m kind of proud of that. It was just kind of like my day-to-day experience is I kind of every day I’m interacting with some loyalty program that I helped launch. And so I think that’s really fun and fun that my family and friends are, you know, have favorite brands and favorite loyalty programs that I helped launch. So I’m, I’m really proud of that. 

And I think there’s kind of like two, you know, areas there’s, there’s like the brands that are the most recognizable, you know, like a Starbucks or something like that, that are the very recognizable brands that I’m very proud of because I see them all over town, you know, I see them everywhere I go. 

And so, and you know, people have heard of them and that’s cool, but even the programs that are not as big and splashy where, you know, nobody has heard of them, you know, like a small, retail chain and, you know, New Zealand or in Asia, you know, that, that nobody, no, none of my friends and family live in the States would be aware of, or, you know, be that interested in hearing me talk about.

But I am really proud of them because of maybe some particular challenge that we overcame, you know, that we were able to, you know, launch a program that far remote on the other side of the world or that there was a really tight timeline. You know, they need to be up the New Zealand one, particularly they had to be up, and, ike six to eight weeks or something like that. 

And we were able to go from, you know, cold, cold start to launched in six to eight weeks, because they had a hard deadline that they, that they needed to meet and so I’m really, really proud that we’re able to do well by the, you know, client stakeholders, hit their timelines and their objectives. And so, yeah, so I think those are kind of the two, two ends of the spectrum is just having.

Very recognizable brands and very recognizable programs. I did a program for Pepsi that was in the super that they had an ad in the Super bowl. So I’m very proud of that. But then also just kind of the smaller ones that are near and dear to my heart because, you know, I helped overcome significant obstacles to, to meet their objectives.

Gabor

Great, and yeah, it looks like you have done lots of implementations in the past, in the past years. And during these years, what did you realize on the market? What were the biggest changes in the loyalty industry?

Luke

Yeah, I mean, I think this is, and this is just my bias from what I experienced. And, you know, I don’t know if this would hold objective truth or if this is very subjective truth, but my subjective truth going through the past few years of doing loyalty is when I started in this industry, 10 years ago, there was kind of a lot of hesitation from clients around technology-driven approaches.

And around, does a program make sense for our brand? Do points make sense for our brand? And that was just kind of a consistent, it wasn’t everywhere, there were definitely some brands that were eager to, that already had a didn’t have any problem launching another version of their points program. 

And there were other brands that were very tech forward and were very interested in getting the latest and greatest software as a service solution. But I think there was a pretty large size of the market at large percentage of the brands that I talked to, that really didn’t, you know, didn’t believe in it yet. 

So they, you know, there were a lot of the programs back in the days. I’m so old. A lot of the programs back in the day were very credit card driven. You know, they were run by credit card companies is, you know, the, the brand would have a branded, you know, particularly in retail and fashion retail, they’d have like a brand credit card. 

And your people, when you’d go to the cash register, you know, the cash year would, you know, try to get you to sign up for the credit card and you’d get points and then those points. And, and I think that was probably the biggest revelation over the past few years.

Moving away from the banks running all of the loyalty programs for brands, and more into the brands themselves owning and running their own programs and having the majority of the say in what the program was going to do. And opening it up because there’s only so many credit cards that you can have in your wallet for better or for worse. 

So people would have, you know, just a couple of these credit cards that they were in these programs that they were a member of, but that would kind of exclude them from signing up for programs anywhere else. Because it’s like, well, I can’t get another credit card, you know, over here. And so it’s this barrier to entry, and then you only had a certain segment that, you know, could engage in these types of programs that were financially in a position where they could engage or would even want to just kind of turned a lot of people off having to do these credit card based programs. 

I think going to this tender neutral, where now you don’t have to sign up for a credit card to be a part of the program. I think that has really kind of opened up the tent, expanded the tent of and welcome more people in a pretty dramatic fashion for better and for worse. I think it has definitely proliferated loyalty programs for better and for worse. And I think that can kind of be a little exhausting for people where it’s like, I just want to buy this t-shirt. I don’t wanna have to download your app, kind of thing. 

And so I think brands need to be kind of careful about, you know, not putting up, you know, these gates and these barriers where customers have to, you know, opt in to loyalty, you know, or if they do making it very seamless. But in any case, I think that’s the biggest friend is, is getting away from credit card programs and opening it up to everybody can, can join these programs and that the brands control the loyalty experience for the customers versus in the olden days, it was all controlled by the credit card.

Gabor

And besides on the past changes, what would you consider like the two main fresh loyalty trends for the next year or the next upcoming couple of years?

Luke

I think the trend that I’ve seen, so kind of continuing on that journey of in the olden days it was pushed out to the bank, the banks ran the loyalty programs. Now it’s coming in house. And I think brands are, have already begun, you know, before it’s just like, Oh, we got a lift and shift from the credit card companies to now we are the ones that have to manage this program ourselves. 

And now I think it’s really, okay, now that we own it, now that we own the program, now that we, the brand own the program, how do we really make this differentiated? You know, how do we really, create something that is really different in the market and that’s really something that only our brand can do.

And I think the way that they do that is by playing to their strengths and playing to all of the different touch points that they have with customer. Making something that is like, you know, that is very specific to the nature of the core nature of their business.

And so I think it’s weaving it across all of the touch points with the customer across all of their channels, across all of their, programs, and then also kind of having this tone of voice through weaving throughout that is really, you know, that is really core to their, to their brands messaging. So, so that’s the first one is I think weaving it across all of the interactions with the, with the brand. 

And then I think the second one,is having, and this is, this is kind of basic, but, important. And I think a lot of brands overlook this. So the second trend is you need to have the base program, the base tier program, you know, one tier, two tiers, three tiers, however many tiers and base benefits. So if you purchase, you’re going to get these currents, you’re going to get those currency points, whatever. And if you get enough of those points, then you’re going to get some sort of a reward or some sort of an exclusive access or benefit. 

So that’s like the base program. And then on top of that, I think it’s important to have, kind of like limited time offers, these LTOs that are part of the loyalty program. And that’s really where you’re going to drive incremental revenue and you drive additional customer behavior and allow the marketers to just be marketers, you know, allow the marketers to test and learn.

Try things, see if it works. If it works, do more of that. And if it doesn’t work, you know, don’t do more of that. And so  it’s really kind of breaking out those, you know, having a base program that is just always on set it and forget it, and then having a strategy, an ongoing strategy of using your overall marketing campaign dollars, but doing that in a way that is really focused at, leveraging the power of all the data that you have on your loyalty customers.

I think really kind of maximizing the value of those relationships, the customers, to drive those KPIs, whether it’s increasing spend, increasing, you know, the spend insurer wallet or increasing the product mix that the customers are buying, moving them up into the tier levels, moving them up into different customer personas. 

So that those are the real, you know, kind of two trends I think are already taking shape, and we’ll just continue to accelerate is being omnichannel. And, having these limited time offers on top of the base program that drive particularly KPIs.

Gabor

Great, yeah, I agree with you, especially on the limited time offers. We have a couple of customers who do that and I am part of some of the loyalty programs myself as well, who do these limited time offers and yes, I can say. I can say definitely.

What do you think, Luke, how a loyalty program technology should or could support all of this? What are the main features to have? Is it also, besides, you know, having all of these features that you mentioned, like capable of doing limited time offers or those workflows that are very easy to use. Beyond that, is it like integrations or no code, gamification components?

Luke

I mean, I think, so it’s, it says, you know, you mentioned the technology vendors. I think part of it is the technology. And I think a lot, a lot of the technology is already kind of there in the ability to be able to support this. But I think it’s the advising clients on the strategy. I think it can be kind of overwhelming for clients when they, you know, get handed the keys to their technology platform. 

You know, they don’t know what to do with it. Right. And it’s kind of obvious to you or I as, Antavo certified, people and, and people that have worked within the technology platform, you know, Antavo and others that have worked in these platforms for many years, it’s obvious to us how to configure A, B or C, but to clients, it can be very overwhelming. 

And I see a lot of trends where, get handed over the keys to the platform and they, you know, you check back in with them a year or two years, three years later, and they are still running the exact same program and the exact same type of campaigns that they were at launch. And I think it’s, it’s not because of a lack of innovation. 

It’s just kind of a lack of education. And it’s not even, you know, just the base education, I think. You know, Antavo has done a really good job around, you know, the, the training exercises and having these kinds of self-serve portals where you can go and you can take these different modules to learn more about the platform. 

But I think it’s also kind of education, educating, building relationships with the, you know, the, the business stakeholders at the strategy level, people that are saying the marketing strategy for those brands and helping them to understand not just the functions and features of the platform, but really the value of turning on these functions and features and how that could be realized specifically for that brand. 

You know, I think, I think Antavo does a really good job of this generally, but I’ve seen, you know, others in the market where they come in, they do a just canned demo, you know, just say, Oh, here’s our list of features. And it kind of can be difficult for brands to figure out, okay, but what does that list of features mean for me?

How much is that going to cost us to implement those features within our brand channels? And so that’s something that I really focus on myself in every conversation that have the clients is, you know, why should we do this? You know, and I think, I think the answer is, I think there’s always a good answer for that, but it’s not necessarily obvious. 

It can take a number of conversations with a number of different stakeholders to really understand the brand, to understand the roadmap for that brand and where they want to go, what their initiatives are over the next couple of years, and then map these new loyalty capabilities into that larger brand roadmap to really get that harmony of the loyalty strategy with the brand strategy.

Gabor

Great, thank you so much Luke. And is there anything else that you have in mind that you would like to share with our audience?

Luke

Yes. I mean, I think the only other thing that I don’t, that I didn’t get a chance to really touch on is I think we’re on the cusp of generative AI. And so it’s, you know, a little bit of the elephant in the room to be talking about marketing technology, or any kind of enterprise technology right now. If you don’t mention AI, you know, there’s, there’s something very clearly bubbling up right now, in research and development that is expected to come out into enterprise technologies like loyalty and market automation. 

And so it’s going to be really interesting to see how that plays into loyalty and how that disrupts loyalty. I’m kind of expecting, it’s a little early, I think, to try to be too definite about how AI is going to impact the particular use cases that AI. 

But I do expect that we’re going to see AI, influencing segmentation, influencing which customers are getting, which offers, and possibly influencing the actual content of the offer and maybe like the discount level of the offer. I could see AI having a piece of that, you know, a part, a part in that.

And then I think, you know, the, the other component of AI, a lot of what we’re seeing is conversational chat bots right now, right? ChatGPT. It’s like literally conversation prompts where you are having a chat with an AI bot. And I don’t think it’s going to, I don’t think the future is that we’re going to be chatting, we’re going to be chatting with every, every computer interface. I don’t think that that’s the future. 

But I do think that there is a particular interesting part of the ChatGPT component where it can start to, you know, remember you and remember past conversations and that future conversations will be influenced by past conversations. I think that is really interesting. And I think that takes that kind of notion of offer personalization, marketing personalization, and, it really adds another dimension of it.

Where you could have you know, generative AI and this kind of chat technology where it’s not necessarily a com like a literal chat conversation or chat prompt that you’re having with a brand, but still every interaction, every marketing campaign could be somewhat becoming more familiar to you based off of your past interactions with campaigns. 

And so there’s almost like a narrative and there’s a, there’s a conversation, underneath the campaigns that’s happening. If it’s not necessarily explicit, Hey, how are you, you know, welcome to Walmart. But it’s like, you know, every time you open a Walmart email, for example, that it’s, hat it, that it’s continuing to get more and more familiar and personalized to you in a way that’s very optimized and very one-to-one. 

So I think that’s kind of, I don’t know. It’s too early to say that that’s what the future is going to be, but that’s something that I’m looking out for that I’m really interested in.

I think it’s too early for brands to invest in AI, particularly if they’re not the world’s largest brand in the whole world, because I think it’d be really expensive to do a science experiment that would actually move the needle right now. There might be some kind of interesting little POCs you could do. But I think keeping an eye on those trends and looking for opportunities to explore it with you know, SaaS companies and technology providers that roll these features out. I think that’ll be really, you know, interesting to see over the next three to five years.

Gabor

Oh, lovely. This is great, Luke. Thank you so much for being here with us today and sharing your thoughts. I really enjoyed our conversation. My favorite part was when we were talking about the ownership change that companies dropped the banks or credit card approach and then brands started to take care of their own loyalty programs. 

They let their own marketeers to run it. And of course the AI part, I am a big fan of AI, so thank you so much for sharing your thoughts, Luke. 

And for the viewers, wherever you listen to us, shall it be podcast platform, YouTube or LinkedIn, please like this podcast and subscribe to our channel, so you will get a notification about our next episode. Also tell us about your point of view on loyalty in the comment section.

Feel free to visit Antavo.com to discover your next loyalty software. Antavo is a next-generation loyalty program technology company used by global companies like KFC, Benefit Cosmetics, global automotive and fashion companies and airports all over the world. 

Also, visit Stedion’s website at stedion.com or Luke’s LinkedIn page to find out more exciting details of his work. Thank you and see you on the next one. Bye for now!