PAYBACK's Gaurav Khurana on why loyalty programs work in India

Gifts! Who does not like receiving gifts? In retail, the moment you reward your customer with a freebie or a gift, chances are you shall be tying him down to your brand for a good amount of time, or, at least till your competitor manages to outdo you. Loyalty to your brand is quite dependent on the rewards you offer to your customers. And no one understands this better than the pro-active team at PAYBACK.
PAYBACK, known for specialising in building coalition i.e multi-partner loyalty programs has more than 50 brands in its kitty. Using a single card, it gives the ease to collect PAYBACK points at over 3,000 partner brands in-store and at more than 50 partner brands online. These points can be redeemed for over 500 rewards across different categories.
PAYBACK’s Chief Marketing Officer, Gaurav Khurana tells all in an exclusive chat with Indiaretailing Bureau.
Tell us about the PAYBACK program.
PAYBACK is India’s largest multi-brand loyalty program that has partners across multiple service categories. PAYBACK entered the Indian market in 2010 and is also Europe’s largest loyalty program. We have partnerships in categories that account for over 70 per cent of customers spend basket (retail, fuel, financial services, banking, travel, online retail, entertainment, hotels, car rentals, mobile handsets, wallets etc.)
PAYBACK has a very large collector base – 50 million collectors and growing and over 50+ in-store and online partners in more than 100 locations through 3,000 points of sales across cities in India like, Central, Big Bazaar, ICICI Bank, HPCL, Hi-Care, EBay, Bookmyshow, MakeMyTrip, American Express, Formula 1 Hotels, Samsung, Mobikwik, Easy Cabs and more
A new customer joins the PAYBACK family every 3 seconds!!
Partnerships in nearly all customer spend categories allow collectors to earn and aggregate reward points for their spends in disparate categories thereby helping them earn meaningful rewards in quick time.
One can double/ triple their rewards for the same transaction by using our partner card while shopping within our network.
Redemption opportunity that has a huge range of rewards, is convenient and gives customer complete flexibility and choice! One can use points to pay for their purchases at the point of sale (just like you would pay with your credit/debit card or cash). Also the option to pay partly with points and balance with cash/ credit card. In addition, have an option to redeem from the rewards catalogue that offers over 15,000 products to choose from. Option to pay partly with points and balance with credit cards
The PAYBACK program added an average of over 3 lakh transactions every day on the network in 2015. Over 4.3 million redemption annually, with an average of 11,800 redemption processed per day. Over 5 billion emails and more than a billion SMS(s) were sent to our customer network annually in 2015.
What was the idea behind PAYBACK?
PAYBACK, the largest loyalty program in Europe entered the Indian market in 2010. Being a multi-brand loyalty program, PAYBACK offers its customers a wide array of product categories across segments to choose from and earn points on every transaction.
PAYBACK enables consumers to collect and redeem points on the move with a wide range of relevant partners both in-store and online, all with just your mobile number. The brand has received an overwhelming response in the country with over 50 million customers already associated with the platform and the number is expected to grow further in coming years.
Who are your partner brands across the retail industry?
With over 50 partner brands PAYBACK is present in more than 100 locations through 3,000 points of sales across cities in India. Our partner brands are spread across retail, fuel, banking, entertainment, hospitality, wallets, travel e-commerce, like Future Group, HPCL, ICICI Bank, Hi-Care, EBay, Book My Show, MakeMyTrip, American Express, Formula 1 Hotels, Samsung, Mobikwik, and Easy Cabs etc.
Comment on number of brands you work with – online, offline, and startups?
We have over 50 in-store and online partner and over 30 plus affiliate partner brands in the PAYBACK network. Our in-store partners include all Future Group formats like Big Bazaar, Central, Hometown, Ezone and HPCL, Formule 1 hotels, Samsung Mobile, Hi-Care, ICICI Bank and many more and our online partners include makemytrip.com, bookmyshow.com, ebay.com, naptol.com etc. Our affiliate partner network includes brands like Flipkart, Snapdeal, Shopclues, Jabong and more which enable customers to earn points on their online shopping when they shop via PAYBACK BINGO.
What are your marketing initiatives?
We have made a number of technology investments recently and are gaining momentum with focusing more on digital initiatives. Add to it, we are proactively investing in digital efforts so as to maintain the competitive advantage.
PAYBACK revamped its portal and came up with its new app keeping in mind the increasing penetration of internet and smart-phone users in the country so as to provide a great experience to the shoppers. The app has been designed to give a seamless shopping experience and offers convenience and accessibility to our members.
We are also working towards making direct marketing a highly relevant communication channel by driving more real time and personalized communication.
What are the new innovations introduced by PAYBACK?
At PAYBACK, we believe in embracing technology to constantly create a more rewarding experience for our customers. Many new features have been introduced such as PAYBACK BINGO, PAYBACK INFINITY and more.
PAYBACK BINGO is our comparative platform on the portal to help users to shop more effectively online. This platform not only provides a single view of the best offers across e-tailers but also has user reviews, coupons and rewards for customers every month for every transaction.
PAYBACK introduced EVERYBUY another innovative solution which facilitates consumers to earn points on everyday purchases they make by just uploading receipts of transactions done for products in categories like F&B, personal care, home care etc, which can be later redeemed to shop on the partner network.
Moreover, we were among the first to launch Mobile Identifier as a unique customer identifier. Customers no longer need to carry their loyalty card for their transactions as they can simply quote their mobile number to earn or redeem their rewards, online, over the phone or at the POS by simply linking their card to their registered mobile number. This has significantly enhanced customer engagement; over 60 per cent of our customers use this as a preferred choice of interaction. Our plan is to completely do away with the card in the short term.
What are your future/ expansion plans?
From a pure business perspective, our focus will be mainly on strengthening the partner base across various categories for a better user experience which will result in adding more users to the PAYBACK program.  In all, we will be focusing on ubiquity to give our customers more choice and freedom along verticals.
We are also looking to focus more on the performance marketing platform. We believe in real time and targeted marketing, giving the customer an experience like no other in terms of right offer at the right time through the right channel. The recent unveiling of the new web portal and the app launch is a step towards enhancing consumer shopping experience.
How mature is the loyalty program strategy in the Indian retail sector?
In India, loyalty transactions have been growing consistently over the past few years due to more real-time and personalized experience being delivered to the customers. In such a scenario, coalition loyalty programs like PAYBACK can offer quite a unique and effective solution to acquire, engage and retain customers across brands in India.
Retail companies have understood that to survive in the long run they need to move beyond traditional methods of marketing and engage with customers to build affinity and salience and loyalty programs do address most of these concern areas.
What are your learning and insights, being a big market player in the consumer loyalty program segment?
Customer insights gained from the loyalty programs help brands create effective and meaningful marketing interventions. These helps brands to maximize the relevance of shopping for its consumers by recognizing individual customer preferences, thereby offering personalized communication, and delivering unique experiences to keep people coming back.
These communications are tailored to an individual consumer preference and not just restricted to more goods and services provided by the issuer but are also open to a whole gamut of selection and choice.
We see a huge change in consumer dynamics, with a large scale shift from offline to online consumption of goods and services and a change in demand of the categories retailing online. The new age customers tend to be quite experimental in nature and we are seeing more movement in new and unconventional categories like furniture, health and beauty care, apparel and groceries as opposed to traditional online categories of books and consumer electronics.
In online world, personalization of experiences is the key to purchase consideration while segmentation with location considerations is critical to offline retailers. Among the factors that are driving retail choices in addition to end prices and delivery experience, are the trust in the retail brand, good returns policy, depth of offerings and loyalty incentives. Shoppers are increasingly valuing digitally enhanced in-store experiences or web channel experiences, easy check-in and check-out experiences and consistent Omnichannel customer engagement which are increasingly influencing purchase as well as purchase location decisions.
Moreover, we do see an increasingly ingrained value consciousness among consumers fueled by the open discount models but also the fact that customers are willing to go an additional mile to draw more benefits in their day to day purchases.
With PAYBACK, companies obtain an insight into their customer purchase patterns not only in their respective category but across spend categories both online and offline. PAYBACK helps network partners to target specific customer segments, and achieve effective cross-selling and up-selling with the help of targeted placement of content.
PAYBACK provides support for new customer acquisition, and enhances engagement, repeat and retention of existing customers.
What are the scalable technologies in loyalty programs available today? What kind of data intelligence do such technologies deliver?
Technology plays a pivotal role in analyzing data of millions of customers and helps define customer segmentation clearly. This in return, helps the marketing team to create personalized offers for every customer according to their preference. This is where PAYBACK plays a major role in understanding the buying behavior of customers and thus helping retailers in providing a personalized offer, encouraging them to either increase their ticket-size with the same partner/category or cross-partner/category activity.
Future Group achieved 10 million member milestone; and the PAYBACK driven loyalty program of Future Group became India’s largest in the retail category, within a short span of time. Over the course of this partnership, PAYBACK facilitated recurring usage among members, enhanced cross-partner brand activity and contributed towards the overall increase in the average ticket size of Future Group customers. The loyalty program further equipped the retail major with data about consumer purchasing pattern; enabling usage of statistical and analytics tools to segment consumers, implement customized marketing campaigns to attract repeat footfall and thereby increasing sales and customer loyalty. By leveraging inferred customer insights derived out of past transactions, PAYBACK identifies the most appropriate customer interface through which the offer has to be delivered. Therefore, providing them with choices and consequently helping the retailer achieve higher sales targets.
According to the findings of a global study by the Economist Intelligence Unit, sales performance is a priority for organizations, with nearly 80 per cent of companies indicating that managing sales performance is important. However, the study shows that the companies lack a degree of sales performance and insufficient or poor quality data is one of the top barriers to better sales performance.