Blind Loyalty Challenge with Rafael Martinez

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Hi there, I'm Amanda Cromhoe from Truth. Welcome to the Blind Laugherty

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Challenge.

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We interview world experts in loyalty blindly. We're hoping to create insights,

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spontaneity

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and a lot of fun through the challenge. The challenge is about promoting the

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Blind Laugherty

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Trust and my book called Blind Laugherty, a 101 loyalty concept radically

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simplified.

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All profits from the book go towards the trust. We hope you enjoy the Blind L

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augherty Challenge.

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So for today's Blind Laugherty Challenge, we combine Mexico with Cape Town, not

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because

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I'm in Cape Town and Raffa is in Mexico, but because Raffa is also in Cape Town

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. So I

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have Raffa Martinez, he is the global lead of MasterCard loyalty consultancy

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and we're

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really happy to welcome you to the Blind Laugherty Challenge.

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Thanks a lot, Amanda, really happy to be here.

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So we did actually let you off the hook very easily because we were going to do

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this live

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at the International Leaders in Laugherty Summit two weeks ago in Cape Town. So

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you've

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actually got the easier way out to do it behind the screen.

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Wow, it should have been better, like fire that and like...

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Okay, we'll do that next time. So straight into it then, so chapter 76 of Blind

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Laugherty

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talks about the shift in frequent flyer programs and how they've moved from the

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rewarding

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flights effectively to more consolidation of everyday spend. So what is your

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best example

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of this consolidation in the frequent flyer world, in the aviation world?

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I think historically it all came up from what their Canada did at the moment

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and in

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spinning off their program. I mean, there are certainly caveats of the results

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some years

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later, but I think the initial story is that they have their frequent flyer

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strategy and

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having customers earning their points and redeeming their points for flights.

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But I think they

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got this and that people were doing other things in a daily basis that could

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eventually

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be fielding their desire to travel and thus connecting those audiences to new

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partners

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to say so they can enhance their speed in earning and getting to their words

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faster.

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So it was a great gateway for the frequent flyers in order to grow their value,

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proper

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their programs, take it out of their airline like ecosystem and finding what

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their customers

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were doing in a daily basis and saying, "Okay, you're going to fuel your tank,

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you're getting

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points for your next level. You're going to buy groceries, you can get points

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for your

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next level." So I think there were the pioneers there. I happened to be part of

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the project

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that did that in Mexico with our Mexico and they were partners in that

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adventure. So we

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learned a lot from them. There were great mentors in doing that part and I

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guess there

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are to be rewarded as the pioneers in this space.

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Great, great. I haven't actually tracked that so I've very much watched

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American Airlines

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and IAG and we obviously had Rob Mcdonald talking at the conference so great

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another

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one to look out for. So chapter the second question, chapter 65 talks about

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payment link

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loyalty and I know this is something you gave an incredible keynote on co-brand

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, co-branded

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cards. What do you believe for the folks out there who don't necessarily

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understand the

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difference? Are they different? Payment link loyalty versus co-brand.

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Yeah, and that's a very good one. The co-brand itself, it's a card that is a

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partnership

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between the brand and an issuer. So they issue a new card linked to the actual

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brand

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loyalty program and eventually all the benefits that are being used by the card

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, are fueled

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by the card whenever you're using it. The issuer is paying those in order to be

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added

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to your normal brand account. Let's say it could be an airline, it could be a

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hotel,

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it could be a retailer. So eventually it's the issuer who's taking upon the

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rewards and

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the value probe of the brand so they can issue a new card and be able to tap

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into that brand

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audience. So that's the co-brand and the payment linking technology is how you

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're using the

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vehicle of a card in order to be identifying a member through your normal

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general purpose

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card. Whenever you are using that in any merchant, eventually you are

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identified there and this

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linking network can identify you being purchasing there and thus adding a

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reward that that establishment

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is paying to the program. So let's say it's a way to create a partnership

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structure, basically

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tapping on the card payment network that's already existing there. I think

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there's a huge

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potential yet to be exploded there because that's a great way to connect a

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member ID

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to a transaction. It's something that's already happening in the payment

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network and it's one

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of the hardest things to achieve in a loyalty program especially when services

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are provided

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offline where you have to connect that transaction to a member ID. So it's been

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explored, some

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parts are doing it very well, some vendors are actually offering that service

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as a payment

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linking technology so you can start creating your partnership network. But yet

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I think

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there is a lot of work to be done in that space to create more value props to

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the loyalty

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member. Yeah, wonderful. Thanks for the clarity. I mean it's not always so

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obvious if you're

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not so informed on it, so very, very useful. Okay, the last one's easy for you.

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What is

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your favorite loyalty KPI? KPI, that's an interesting one. I'm gonna be, I'm

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gonna go

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to the simplest one because everything starts there whenever you're having your

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member acquisition.

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Yeah. So the penetration of sales, that means all the customers you can start

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seeing. So

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I mean you can go for conversion, you can go for ROI but everything starts from

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the customer

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that you have and you can truck. Once you have that, I mean then the next step

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is what

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you do with it. No, I think the design with purpose to create the loyalty

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effect on those

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members is what really matters but everything starts from the customers you

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have. So we

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have a very recent example with one of our customers that really you can see

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them at

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a very successful program but they are struggling to see what's outside of

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their membership base

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because they have an offline interaction and they can only tag their sales to

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identify

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what customers in people who's only within the program. So that's extremely

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powerful.

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You can see this company being massive one of the greatest examples in loyalty

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but they

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struggle to see what's outside their program. So the value for them for having

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members and

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be able to start generating the information to do the rest of the loyalty

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strategy is

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extremely powerful. So I will go with that one.

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I'll always give a big hands up for anything that's simple. It's the title of

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our book

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and on the put on the discussion of the book actually a big thank you to you

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and your team.

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I know you purchased copies for your whole team and we had a wonderful session

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where

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we talked through the blind loyalty story. So it's just wonderful that we've

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reached

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Mexico and you've brought Mexico to Cape Town. So thank you Raffa. Who would

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you like

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to tag next for me to chat to?

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So I want to tag a good friend and former colleague of ours whose name is Bruce

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LaHood.

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And Bruce has a great experience in loyalty. He was former head of loyalty at

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New Zealand

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and then I actually hoteled. So Bruce has experience being consultant, operator

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and he's

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one of these persons that has massive passion for loyalty and a great way to

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transmit it

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and convey to it. I will definitely want to see Bruce taking the blind loyalty

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challenge.

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Yeah, of course.

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Right. Well, I love meeting new people and he's from the travel industry as

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well. So

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that's always such a bonus. So thank you so much Raffa and enjoy the rest of

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your fabulous

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time here in Cape Town. It's such a pleasure to have you here.

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Thanks for hosting me Amanda and looking for more of this great info and

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knowledge that

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you're sharing with English.

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