Leaders in Customer Loyalty, Powered by Loyalty360
Leaders in Customer Loyalty, Powered by Loyalty360
Loyalty360 Loyalty Live | Kyle Clark, Mastercard
Mastercard® has been a leader in payments since the late 1960s. Over the past decade, the company has evolved its suite of services to help customers make smarter decisions with improved outcomes. When it comes to consumer engagement, Mastercard works with brands to deliver better experiences and ultimately drive long-term loyalty.
Kyle Clark, Senior Vice President of Merchant Loyalty at Mastercard, has seen many changes in consumer behavior, especially in recent years as consumers increasingly shift to digital. Clark’s focus is on supporting brands across industries to build loyal relationships with their consumers.
Loyalty360 sat down with Clark to talk about recent news and developments in the customer loyalty industry.
Good afternoon, good morning. This is Mark Johnson from loyalty 360. Hope everyone's happy, safe and well. Want to welcome you to another edition of loyalty live. In the series, we speak with leading agencies, technology partners and consultants, and customer channel and brand loyalty about the technology trends and best practices that impact brand's ability to drive unique experiences and enhance engagement but, most importantly, impact customer loyalty. And today we have the pleasure to speak with Kyle Clark, the senior vice president and merchant loyalty from Mastercard. Welcome today, Kyle.
Speaker 2:How are you Good thanks for having me on. I really appreciate the opportunity.
Speaker 1:Absolutely. Thanks for taking the time to speak with us today. First off, can you tell us a little bit about yourself and your work at Mastercard?
Speaker 2:Yeah. So about myself, for me, I've actually been in the loyalty industry going on 18 years, worked for a variety of companies during that time, held a variety of roles, started out actually building loyalty technology as an engineer, did a sales engineer selling in loyalty technology, and now I've got the privilege at Mastercard to lead a global product management organization. We're responsible for our products and services that we sell into brands, and so it's really cool being part of Mastercard because we're such a global leader in loyalty. We run more than a thousand loyalty programs across 800 million profiles every day of the week, and we do that serving a variety of verticals, including financial institutions, quick service, restaurants, retailers, airlines, fuel stations, telco, cpgs. Those are really our main focus areas and what we do here.
Speaker 1:Okay, excellent, when you look at the state of customer loyalty big industry right now growing impacts and importance of customer loyalty that is. Would love to know more about some of the trends that you're seeing. I know I've seen a couple of reports from Mastercard recently with regard to the state of customer loyalty. What are some of the key factors in the customer loyalty industry today?
Speaker 2:Yeah, I think the key factor. There's a key overarching factor to me and it's the fact that consumers are expecting more when it comes to their experience with the brand. Right, for a long time we've had points programs and rewards programs, and those have evolved over the last, let's say, 20 to 30 years and they're going to be around. Consumers expect them. But when it comes to consumer loyalty, consumers are beginning to look at the holistic experience Right, and they want to know what's in it for them beyond points and offers. And so, as part of this, if you look at this persistent shift in digital that we've seen over the last few years, we have to look at that digital channel and the rise in that digital channel. But we also have to think about the other parts of the experience, like the in-store experience, and so I think what's really crucial here is it just magnifies the importance of having a really solid omni-channel engagement strategy, right. So when we look at kind of like tactics that really fit here, we have to look at tactics that leverage the loyalty program itself, look across channels but also go beyond the loyalty program. So look at mobile ordering, buy online, pick up in-store personally, like return curbside Right. We look at these convenience factors. Consumers are looking to those and they're measuring their loyalty based on that.
Speaker 2:Because think about that interaction Right. You get an offer. Clearly, you redeem that offer through your mobile application and you want to go pick that product up in-store. A really good experience is an hour later you say it says it's ready, you pull up, you either call the number on the sign or you check in via the mobile application and in a couple of minutes they bring it out. That's driving loyalty beyond the loyalty program while leveraging the loyalty program. But what if they can't find my order and it takes a long time? That can also end up loyalty, right. So I think that the key here is that really the best experiences are those that have the incentive mechanisms built in through equity and we think about factors beyond the program itself and that's really what's going to ultimately drive that value to the consumer and then, in turn, loyalty back to the brand.
Speaker 1:Okay, when you look at the customer evolution, it's a big discussion within our community. We have had a meeting a couple of months ago regarding what customers are expecting and how they're changing. What are you seeing with regard to customers evolution from a behavior perspective, what they're expecting from the brand holistically, and maybe from a customer loyalty perspective?
Speaker 2:Yeah, definitely so, beyond the shift in expectations around the consumer experience. It's also just putting your consumer hat on for a minute. We want companies to care about that, so we want our interactions to be tailored and we really want to feel real value from these loyalty programs that we're part of, and so I think there's three key things that consumers are really seeking in a loyalty program, and the first one is utility.
Speaker 2:We want and we expect more from the engagement that we're given. We want more value out of that engagement In terms of we want more flexibility in the way that we can use rewards, a greater variety in redemption, and we also want to see increased exclusivity and status, and that's the expectation of us to continue to grow and sustain our loyalty for a brand. So I like to think about the macroeconomic environment and how that ties into this right.
Speaker 2:So a lot of uncertainty, rising cost of living and consumers' turn to loyalty programs, particularly during these times. One, the offset that increase in the cost of living, but also to get something special, to get a perp right that they may not otherwise get, and so consumers are really seeking utility in the program, and that's just two ways to seek me. The second factor, I think, is around convenience, and it goes back to that streamlined experience. Consumers aren't asking for saying, hey, maybe we want this. Consumers are saying we want a streamlined, frictionless experience that's consistent across channels, and with the rise in mobile, there's a particular focus there for consumers as well.
Speaker 2:And then the third and I actually think this is the most important is around personalization, and what I like about this is that the fact that we use consumers. We've woken up recently to the value of our data and we've said, hey, brands want this and I'm happy to give it to them, but I want something in return. And the value exchange to me is very simple right, as a consumer, if I'm going to share this data, I have this expectation that I'm going to get a tailored, personalized experience that gives me an emotional connection back to that brand, and I don't think that's too much to ask right. I think personalization is definitely key. So consumers are expecting utility, convenience and personalization.
Speaker 2:So then we have to think about what do we do as companies to meet these expectations?
Speaker 1:So three areas here.
Speaker 2:And the first one is something I like to call smarter engagement. So we're getting this data in consumers. You have a variety of channels, but how do we unlock that data? And there's a few key components to it. The first is you have to have a strategy that's more for you. It can't just be what you're doing in the next three months. The second is you have to have technology to enable that strategy.
Speaker 2:And then the third and I think often to overlook component is you have to be organizationally aligned and you have to have this consumer first mindset into what you're doing as it relates to loyalty, to really drive smarter engagement that the consumers are demanding. And yeah, I'm sorry I would say the last two points of this is that we also need to think about measurement and measuring what we do. So if we're trying new tactics, we've got to understand what works and what doesn't. And then, last is interactions to rebuild an organic relationship with consumers, we have to have authenticity right and we have to have engagement that's genuine to the brand. So I think it's really those elements.
Speaker 1:When you look at some of the brands that you're working with. You mentioned authenticity. You talked about utility, personalization. All those are kind of salient topics in customer loyalty arena, as we see it, as we meet with brands fairly consistently, but when you look at the brands that you're partnering with, what are they embracing? Because there's so much going on right now. Many brands are looking to redo their programs, enhance their programs, add new functionality. It could be challenging, though, so what are they embracing potentially, and what are they moving away from?
Speaker 2:Yeah, I think there's three topics that are really being embraced, and the first one is one of my personal favorites and it's paid loyalty or subscription loyalty or premium tiers whatever name we want to put on it. But there's a staff that I saw actually this week and I really like it. 73% of members of existing programs would be willing to consider paying a fee for enhanced benefits, and I think that's phenomenal because you have this engaged base in a loyalty program, right. But then research is showing us that they're also willing to pay more to get more exclusivity, more benefits, more perks, and I think this is a win-win for a brand, because not only can we drive more engagement to consumers through a paid tier or a premium loyalty program, but we can also create a revenue stream, and I think there's a lot of a road to go in this particular space, and that's definitely a key topic we're discussing with a lot of our clients. Okay, yeah, interesting.
Speaker 1:And what do you think will mark the next chapter of customer loyalty? What's next?
Speaker 2:I think we just have to remember that things are changing pretty fast right in the world. That's not going to slow down and, as I said earlier, it's going to take more than points and rewards to build relationship and long-term loyalty. So the next chapter in loyalty is really going to be marked by how well brands can think holistically across that experience and arrive at this conclusion that loyalty is not just a program, it's not a single interaction, it's an outcome right, and it takes some time to get there and as part of it it goes back to. It's going to require creating, sustaining those authentic relationships, and I think the companies that are really going to be successful are the ones that can collect and measure and act on data to meet the changing consumer expectations. Like those are the ones that are going to rise to the top and thrive.
Speaker 1:Okay, technology changes are part and parcel in the world today and life today, so loyalty is no exception. With CDPs, with mobile proximity applications, ai, it's kind of a daunting challenge for many brands. When you look at some of the technologies that MasterCard has, how do you successfully help integrate some of these technologies into their existing technology stacks in a seamless manner that can complement or augment what they're doing from a customer experience and customer quality perspective?
Speaker 2:Yeah.
Speaker 2:So an exciting about MasterCard is that we have it starts for us like with our high frequency and trusted insights from the MasterCard Economics Institute, and I love having this asset, not only as a product manager to help me make decisions with my team, but also our clients making informed decisions on what's going on in kind of a macro sense.
Speaker 2:And then, when you look at MasterCard's offerings, we're a full service end-end loyalty department. We have loyalty capabilities where we can run in-store programs, co-brand programs, card link programs, benefits and interns, as it runs the full spectrum in terms of the capabilities. And then we complement that. We can add dynamic yield for best-in-class personalization. We can add our test and learn capability to make sure that we can measure. And then the best part about it is we can bring strategy to bear as well, so we can really execute against those three areas I mentioned earlier giving a strategy, enabling it via technology and then helping make sure that the organization is there to support it. So I think what's exciting for MasterCard is we can bring all of these things together and allow us to not just bring a one-size-fits-all program. We can tailor our engagements for each individual customer, because that's really what's needed to win in the market.
Speaker 1:Okay, you talked about this a little earlier personalization another very relevant topic, very timely right now. When you look at personalization, I think the definition of what personalization means can vary quite widely. But it's no longer about just having your name in the subject, the header of the email. It's not necessarily about the content, it's rewards, it's engagement. It's much bigger, but it can be again daunting because you have to be able to have the right technology to be able to do personalization at scale. How can brands effectively leverage data and insights to create better experiences and build loyalty, and can you provide us maybe a couple of brands that are doing some unique things in that regard?
Speaker 2:Yeah, to me there's this foundational role. You have to have a 360 review of the consumer for good engagement and you have to have clean zero-party and first-party data to really have effective personalization.
Speaker 2:Now, that being said, that's just the starting point. You also have to be proactive instead of reactive, and what I mean by this is you've got to be using predictive insights to dynamically curate, you know, offers and products and content to put in front of the consumer. But then also, we've got to go beyond just purchases and we have to look at behavior-based offers and promotions and make sure that we're leveraging those to allow conditional offers and benefits. There's a stat that I like from the dynamic yield study and it says 98% of companies survey plan to invest more in personalization in 2023.
Speaker 2:And I like that because we have to right, because we also know that consumers are more likely to do business with the company if it offers personalized experiences, and if you're not, they're going to get that. They're going to let appeal that need you know somewhere else. So I would say that, in terms of a great example, I signed up for a new streaming service recently and I loved it because the first thing they did is, you know, they asked me what do you like? So they named four things about me at this point that I paid a fee. They know my email address is my first and last name. But instead they said, hey, kyle, what do you like?
Speaker 2:And they asked me genres and shows. And then, right there, I have a more meaningful engagement. So a key message here is learning from that experience. Don't wait to get started with data. Right, get it out there, start trying personalization, but when you do it, leverage what you have build over time. But make sure you measure along the way so that you can, you know, get the most out of each interaction.
Speaker 1:Absolutely. When you look at the upcoming holidays right Busy time of year, black Friday, everything coming up you know brands are starting to finalize some of their strategies growing consumers, how to engage them, how to maximize the shopping experience and also, potentially, the revenue opportunities when it comes to loyalty and customer engagement. How should brands be approaching this busy shopping season?
Speaker 2:Yeah, I think it's really crucial that brands are as soon as possible right. If your acquisition strategy includes signups during the holiday, I'd question if we're really just kind of giving away discounts. So think about that. If I'm standing there in line with a hundred of my closest friends who are also waiting to check out and they say, do you want to sign up for the loyalty program? I might say no, right. But then they'll say, what if I give you a 15% discount? Well, of course I'll take the 60 seconds and I'll do the sign up. So you have to think about starting earlier in the year, right, giving high value offers and curating and cultivating that relationship with the consumer before the holidays. So they're going to choose your brand going into the holidays. I think that's really critical. And I think it's even more critical for brands that don't have a brick and mortar presence as well.
Speaker 1:And go ahead.
Speaker 2:I was going to say the other thing to consider is link back to that experience, right? So there's the loyalty component of the holiday season, but there's also all of those new channels. Make sure that that is a solid experience beyond the loyalty program itself. So if you're buying online and picking up in store, make sure that the entire experience, holistically, is going to meet the mark for the consumer to really drive loyalty.
Speaker 1:Okay, when you look at brands, you may be looking to kind of adopt, adapt, enhance or innovate around their customer loyalty programs. What's one piece of advice you would give your brand? Are there some quick wins that brands should consider?
Speaker 2:Yeah, I think if there's just one piece of advice, it would be find ways to provide real value and benefits that go beyond offers and points. And to me, this really goes to evaluating the role of status and perks in a program right, hey, we haven't seen you in a while. Come in next time, get a free coffee. The role of surprise and delight, in the role of not just giving away more and more points and more and more offers, but playing into status and playing into perks, and playing into something that's different to get the consumer to try something they might not normally do. I think that's the one piece of advice, but in doing so, make sure that you measure it. Anytime we introduce a new element into an experience, we want it to be a quick win, but make sure we understand what success looks like and we can measure it and learn from it.
Speaker 1:Okay, any closing thoughts? What's next for MasterCard in 2023 and going into 24?
Speaker 2:Yeah, I think for us it goes back to this holistic consumer experience right, it goes back to the role of subscription and the role of perks, but really taking a look beyond the loyalty program itself and how we can cultivate relationships across the entire consumer experience. So for us, I'd say we're just laser focused on the consumer experience. We want to help our customers create better and stick your engagement so they can build long term organic relationships with their consumers that they need. Okay.
Speaker 1:Well, great, kyle, very interesting getting to know you a little bit better, but also getting a better understanding of what MasterCard is doing in customer loyalty, from a co-brand private label, but also more from the disparate data systems you have that help brands create some of the actual actionable data and simplicity, which is great to hear Awesome.
Speaker 2:I appreciate it, thank you.
Speaker 1:Absolutely, and thank you everyone for listening today. Make sure you join us back for another edition of Booty Live soon. Have a wonderful day.