Dotz is a coalition loyalty program which was founded in Brazil more than 23 years, and has grown to over 50 million members, eventually becoming a public company in 2021.
This story is amazing. Creating a pioneering business from nothing, to now over 50 million members, Roberto has a clear and compelling passion to make a difference in the lives of Brazilian people by increasing their purchasing power.
Listen to hear his insights on some of the challenges and the key success factors for coalition loyalty programs in different markets around the world in the past, the present and of course in the future.
Paula: Welcome to Let’s Talk Loyalty, an industry podcast for loyalty marketing professionals. I’m your host, Paula Thomas, and if you work in loyalty marketing, join me every week to learn the latest ideas from loyalty specialists around the world.
This show was brought to you by Comarch, a global provider of powerful loyalty management tools. To increase customer lifetime value and improve your return on investment. Recognized as one of the top loyalty technology solutions providers in the Forester Wave Loyalty Technology Solutions Report Quarter 1 2023, Comarch is responsible for over 120 loyalty initiatives in 50 countries around the world. Comarch technologies help companies design, build, and manage highly immersive loyalty programs that bring results. For more information, please visit comarch.com.
Hello and welcome to this episode of Let’s Talk Loyalty with an exciting guest joining us for the first time, all the way from Sao Paulo in Brazil. Roberto Chade is the Co-founder and CEO of a coalition loyalty program called Dotz, which has now been on operation for 23 years. His story is amazing, creating a pioneering business from nothing to now over 50 million members, and then becoming a public company in 2021.
Roberto has a clear and compelling passion to make a difference in the lives of Brazilian people by increasing their purchasing power. And he joins Let’s Talk Loyalty today to share his thoughts on some of the challenges and key success factors for coalition programs in different markets around the world, in the past, in the present, and of course in the future.
I hope you enjoy this fascinating conversation with Roberto Chade from Dotz in Brazil.
So Roberto, welcome to Let’s Talk Loyalty.
Roberto: My pleasure. Happy to be here.
Paula: It’s been a wonderful experience watching some of what Dotz has been doing, Roberto. From a, a very long distance, I have to say you are in Brazil, I’m in Dubai, so I dunno how many thousands or tens of thousands of kilometers between us, but I’m super impressed to see, what you’ve created over the last 23 years. It’s super inspiring. So it’s been a long time that I’ve wanted to come and have you on the show, and again, even in terms of the whole continent of South America, I feel like I’ve neglected you guys. So thank you for being with our audience today.
Everybody’s gonna be super interested to hear the journey you’ve been on over that length of time. But before we get into talking about Dotz, we always do start this show, as you know, asking our guests about their favorite loyalty programs other than their own one. And that’s for me a very, I suppose, selfish question to learn about other programs I might not be familiar with, but also learn, you know, what you as a loyalty professional tend to admire.
So tell us, Roberto, what is your favorite loyalty program?
Roberto: That’s a, that’s a great question, Paula. I’m a true believer of the coalition model, and I’ve been, I’ve been, I mean, following all over these years. I mean, the evolutions and the ones that are really, cause it used to be a very, a very, new model in the past.
And it, it, it got little, I mean, out of date in cer, certain ways, in certain regions. And the one that is really transforming itself and, and, and really bringing the, the new technology into the, the new coalitions Payback in Germany. So I think it’s, it’s, it’s a, it’s a great program. It’s a, it’s, it really inspire me as well in terms of the evolution that I’m trying to build the Dotz.
Roberto: And, and, and, and I think it’s, it’s a great, it’s a great benchmark today for, for, for, for coalitions and for loyalty programs as well.
Paula: Absolutely, yes. And I do remember when we had the team on from Payback, Roberto, we, you know we talked a lot about some of the key success factors for Payback specifically, and Bernie was amazing, you know, and I think what, what I remember was particularly inspiring was his focus on getting the the members to, to redeem and to enjoy the currency and really to drive that engagement.
Whereas I think in the past sometimes, particularly coalition programs, they might have had this idea that breakage was important. But I think that’s changing. So it’s definitely one that I would be interested in your perspective on, maybe later in the conversation. But yes, I think Payback is doing extraordinary work.
And to your point, I mean, coalition models have been super popular and then they fell out of favor. And I do think that some are doing extremely well and Dotz is clearly one of those. So maybe would you start Roberto by telling us a bit, maybe first of all about Brazil and the kind of loyalty market there, because I feel like I know so little about you guys.
Anything I’ve heard has been like actually super impressive, especially the numbers you just told me off air, which we’re gonna get into as well for the Dotz program. But would you mind just telling our listeners a bit about your loyalty market?
Roberto: It’s quite new, I would say. I mean, compared to, to other markets.
If you go back to, to the early days, 30, 40 years ago, I mean, Brazil was just like an airline loyalty market, the start of airlines. And, and, and they kept that for, for, for, for, for many, many years. And then the, the credit card joined. But the, the airline in credit card partnership where they were using mild, so very concentrated very, very, segmented to the high end class.
Right. So it, it, it was like that for, for, for for many, many years. That changes, mainly when Dotz was launched like 20 years ago. Cause we, we democratized the market in Brazil. I mean, we, we were responsible in, in, in expanding, loyalty to, to all different sectors beyond credit card and airlines.
And also, being a, offering a tangible program to, to the middle class of Brazil. And that was beginning of the transformation, of companies and loyalty programs in Brazil. And since then, I would say like, like the last 10 years mainly, I mean, it’s been a huge growth. I was responsible at the beginning of the, the foundation of the Alliance Association in Brazil, and we started to track by the number, the number of, of subscriptions, the number of enrollments in the number of points issued, the number of redemptions, and it’s been growing since then. I would say 30 to 40 percent every year.
Roberto: We have more than, than than 200 million enrollments. Of course, they’re not single enroll. Because I may, I may be, I may participate in two or three or four different programs, and we, we have more than 200 million enrollment, active enrollments all over, all over Brazil.
The, the, the, the programs, I mean, when it’s pretty much beyond, their life. So retailers, banks, companies like Dotz, that, that build their own program. And, and now I think we are getting to the phase with the new techno technologies and, and, and, and the apps and things like that to, to, to enter into a new phase, which should be like the, the, the long scale, the, the small, the small merchants and ok, it’s now getting, yeah, getting into that, into that phase.
So I think loyalty, it’s around, it, it is still, I mean, a lot to be done, I would say in Brazil. In terms of education, in terms of getting people to really, to understand all the benefits. But it, it, it’s, it’s there. I mean, it’s really, it’s really, it’s very active. Most companies in Brazil, either do have their own loyalty programs or are planning to, to, to build something or to join something. The cashback, the cashback, I mean, the benefit is, is, is, is helping now also in terms of, of spreading that around especially in the online segment, not in the offline, but margins for offline that offer to, to support cashback. But I, I do still, still a, a, a lot ahead up to, we get a mature market, a lot to be done still.
Paula: Okay. It sounds to me and correct me if I’m wrong, Roberto, but it sounds like it’s a well respected concept and proposition, both by consumers and also by, by businesses in the country. Would that be fair to say?
Roberto: I think so. I mean, I think you’re right. Of course, it, it, it depends on, on, on, on segments, both for consumers and for companies, right?
I mean certain companies, certain segments, are very mature. Again, like banks, large retailers, I mean, both of them are to have a certain kind of loyalty initiative and on the consumer side, the parents, are very used. The middle class are now more and more getting more, present.
And, and there’s still a room for the lower class of course. Cause they, they spend less. Then it, it’s harder for them to, to, to, to, to have, to see the, the real benefits. And I would say we, we are, we’re entering the, the we’re not a teenager anymore. We are entering the, the, the early, the early adult life, right? I mean, something like that.
Paula: You’re a grownup, huh?
Roberto: Yeah. Yeah. Some, some, something like that. Yeah.
Paula: But I like what you are positioning it as Roberto because I think some of the criticisms that we hear about loyalty programs are around the difficulty to, you know, engage or transact frequently enough to, to find any benefits or any point in bothering to go through the data, collection exercise.
Cause we all know it’s not the time, it’s just the, the perception that, oh my God, here’s somebody else taking my data and they’re not gonna do anything with it. And that might be true for, for me. For example, you know, when I lived in Ireland, for example, I wouldn’t be flying very frequently. So why would I bother flying or joining the, the frequent flyer program?
I may be loyal to a supermarket. I may not, but what I like is, while there is an amazing business model for airlines and frequent flyers, and thankfully now in Dubai, I get to fly a little bit more, but this democratization idea and making sure that the breadth of the coalition proposition makes it relevant and tangible to the whole of the middle class.
I think that’s a shift that many countries haven’t successfully achieved in the way that you have with Dotz.
Roberto: Yeah and, and I do believe, Paula, that for, for certain certain countries, especially the ones that are like emerging countries with a, a very, very large middle class, I mean, the coalition might be, I wouldn’t say it’s the only alternative, but for certain segments might be really the only alternative to just, I mean the, the, the, the majority of the population do not spend too much in a single segment to see the value. We, we also see a very, the competition, I mean, is really getting stronger and stronger in all different segments. Margins, margins are, are, are under decreasing or, or will be decreased most, most segments. So they, they invest that any, any specific company could afford in order to, to, to, to give a benefit individually. It’s really, it’s really tough. And when you, you combine, right? I mean companies, watching the past, I mean, we would say coalition now, lot of people are saying like, this is the ecosystem rights. Build a new ecosystem. At the end of the day, it’s a combination of effort.
And in order to, to deliver value to, to the consumer that again, do not, I mean spend too much cause it’s, it’s, it’s of the, it’s a consequence of, of their, their economic condition. I mean, the combination is, is very, is is the only one. It might be the, the, the, the only alternative. So, that’s why when I get asked about the, the coalition model cause some of the, some of the programs are struggling. I mean, what would be my, my view. I, I, I keep saying that coalition is still a great model, but as everything else, I mean, needs to evolve. And the ones that are struggling are the ones that stop evolving, stop doing new things. And, and, and what I’m trying to do, and actually what, what was last week in, in Zurich before the large conference, what I presented in the panel, it’s my view.
What’s gonna be the new guiding principles of the new coalition? So again, I think it’s, it’s, it’s a great model. It’s for certain regions and for certain segments of the population. It’s the only model that can be, can be sustainable. But on the other hand, I mean, although, I mean, we are in the, we are in the relationship by industry, right? We do as an industry also, still struggle with lots of friction, right? The, the, the programs are not easy. Most of them. They have too many rules. They have too many conditions. They have too many steps. And, and, and, and changing that is, is, is is something very, very relevant as well.
Paula: Absolutely, music…
Roberto: That’s why we are trying to do that in that we’re trying to do that in the evolution of Dotz.
Paula: Okay. Well, I will definitely wanna get into, I’m writing a list of so many things, Roberto, that you’re talking about, but evolution, the guiding principles of coalition for the future, for example.
These are are really important principles. I know your positioning has evolved as well into this kind of super app piece. I do want to explore with you, but before we move away, you know, coalition and, and your very strongly held belief, which I totally agree. Again, it’s very different for every country, but clearly in Brazil, the coalition model is extraordinarily powerful.
But yet in countries like United States, it has absolutely failed and high profile failures with huge investment behind them, including American Express and, you know, smart people. So what’s your view on that? I mean, it’s not a criticism or reflection or, you know, maybe it’s just too big or too dispersed or too complicated.
What would be your view, do you think coalition could ever work in North America?
Roberto: I’ve been trying to answer that question for, for many, many years and trying to have my view of that as well. So, a couple of thoughts on that. I mean, initially, in one way, coalition is, is a very simple model to understand in terms of the combined companies and usually the same currency.
So it’s easy to understand. But it’s very hard to implement. Very, very hard. Cause we are, you are, you are combining companies with different cultures, with different, different voices, different goals, different ambitions. That’s why, that’s why, the, the, the success rate of coalitions I mean, it is not, I mean, if you do it, you, you will succeed. No.
Roberto: There are many variables, many, many variables in order to to, to make it model really successful. I mean, it goes from, from selecting the right partners, selecting the right business model, select the right government. Select several things, right?
And, and, and, and, and adding to that, so this is a, a, a a, I mean, an overview that, it’s relevant regardless of where you are launching your coalition. Right. It’s, it’s everywhere. Regarding US, I mean, there are additional complexities, I would say. In order to, to, for, for the coalition model, so, I mean, going from, is still, the west market is very regionalized, right?
I mean, the bank, it’s kind of changing a little bit. But up to recently, I mean, the grocery in the, the west coast is different than the, the grocery in the, the east coast, which is different than…
Roberto: The grocery in the, the, the central of the west. And, and, and then selecting you, you’d have to select several partners in order to build very, very, very large national program. The other thing, I mean, the purchasing power of the, the, the, the American consumer is high. I mean, it’s much higher than any other place. I mean, you can do a, a proprietary loyalty program for, for buying like this pen. I mean, you have enough people buying enough pens in order to be rewarded.
Roberto: That doesn’t happen in most of other countries, so the purchasing power of the American consumer is, is quite different. Another topic may be the, the, the, the, the American companies are more individualized. I mean, they, they have their own their own. They’re more verticalized, right? I mean, they, they, they, they, they think they can do everything by themselves.
Right? So I, I, I, I’m not a, a, I mean, again, and I don’t know the answer if there might be on or there might not be a, a, a coalition in United States. What I fought once in doing it, it is a, a segmented coalition, right? I mean we, we, we, we had a, a, an idea in the past we didn’t, we didn’t move forward with that, was to do a coalition for Latinos in the US.
Paula: I love that. Oh yes.
Roberto: So you do like a, a segmentation.
Roberto: So, again, I was strong believer of the combination, although the coalition itself didn’t work, but several programs in the US they do have, the partnerships. So they’re not too far, I’ll say from, from from a coalition. I mean, they’re pretty close to that. But maybe segmented coalition, could be a first step into that.
Paula: Yeah. I love that. That’s, I think quite genius, Roberto. Because it really taps into, you know, the core belief system, the connection, the community, and I suppose just the clarity, you know, that a member needs to feel like this is something for me. So I think that positioning would be super compelling for Latinos in the US.
Roberto: I think could be, it could be a a first step. A first step.
Paula: Why not? I’m sure you have.
Roberto: If you, if you, if you are your audience, agree to that and wanna talk to me about that, I mean, we can, we can chat.
Paula: Totally, totally. Well, we, we do have an amazing audience, Roberto, loyalty managers, loyalty directors in US, UK, Australia of course.
So I’m pretty sure after this conversation, once we publish it now in, in April, there’ll be a lot of people reaching out to you to, to pick your brains on how they can maybe optimize their own programs. So maybe just give us a couple of statistics, Roberto, You gave me a huge number before we came on air in terms of the current membership.
So any statistics you can share about Dotz, because it’s incredible. I think it’s 23 years old now. Am I right in terms of its age? Formed in about the year 2000? Yeah.
Roberto: Yeah, we, we, we launched a Dotz in their 2000 when we were living in the the dot com era. Right?
Paula: Yes, I remember.
Roberto: And, and, and, and the idea was to the time it was, was, I mean, in the US, in Europe, had been launched, a few online coalitions like beans.com in England. My Points, Clicker Rewards, I think a few programs like that. So they were, they were the inspiration for us. And Dotz was, was, was an online program for many years. I mean, we did the opposite way. So from 2000, 2009, we were mainly an online coalition. I mean, you, you use points for, for online shops and…
Paula: Like an affiliate?
Roberto: No. It wasn’t, wasn’t, wasn’t pretty affiliate. We, we, we, we, we’ve become later in the field for online. But we were, we were actually, we were shopping at like the Amazon Brazil. At, at the check, the checkout you would have an opti where you would be receiving your point. So we were like directplatform to, to most of the online players in Brazil at that time.
Paula: Amazing. Yeah. Okay. Yeah.
Roberto: The problem was that even, even today, I mean, online in Brazil would present like close to like eight to ten percent of all transactions which is not, not, not to, to, I mean, it’s, it’s quite, quite low yet. I mean, at that time was even lower. Right?
Paula: Of course.
Roberto: So in order to be successful, I mean, we, we would need to go like offline.
So then in, in 2010, that’s when we, we, we, we expanded into offline. And the challenge in Brazil is that similar to the US. I mean in certain segments, especially in the retail segments. We do have the national, I mean the large national players, but we do have very relevant regional players in every other regional, Brazil. I mean Brazil is a huge country.
Roberto: And in every other region in Brazil, we have a very nice grocery, very nice pharma company, a very nice gas station local. And so we did the, the, the, I would say the, the, not the the easiest way, but the, the, the, the hardest way. Cause we decided to go, we need to reach on finding the, the regional, the regional motions.
And, and, and, and so for, for, let’s say for seven, eight years, we, we, we mainly launched Dotz several times in different regions of Brazil. Ffor having a combination of the large national sponsors like Bank Brazil, the largest bank, the largest telco, but in the other hand also very relevant to small workers, right?
So we have today, I mean, close to 50 million users. We are, we are present in, in all different cities of Brazil in with our sponsors. We’ve been collecting lots of data. So for, for the last, I would say five years, we started collecting the SKU. I mean, the item that, consumers buy at retailers.
We have close to 10, 10 billion SKUs. Linked it to each individual CPF, which is each individual person. And we’ve been trying to, to, to develop a new product and new services based on the data that we have been collecting. And, but it’s still, I mean, we are staying the half journey, half half, I mean, part of our journey.
There’s still a lot to be done. We need to increase a lot of our engagement. We need to increase a lot the love that users have for Dotz. I mean, it’s going beyond, I mean, having a, a member into becoming a really lover of Dotz. And, and that, that’s a lot to evolve. We, we haven’t reached the final, the final, final step yet.
Paula: Yeah, it’s a beautiful word actually, Roberto and, not one that is used very often on this show, but, I love what I love when the word love is used because actually I think it comes back to the reason that I really decided that loyalty programs and, and optimizing those customer relationships was where I wanted to focus my attention and energies. So this idea of loving our customers and having them love us is a very beautiful intention, and I do think members feel that.
So I think, you know, particularly with coalition programs, they could be perceived as being very transactional, but the fact that you’ve taken the care and attention to go region by region, as you said, to go and sign up the relevant grocery partner, the relevant local organizations for people all throughout the country to make sure that they can actually, you know, connect and enjoy and earn.
I think that shows through and the customers feel it. So I’m not surprised to hear that you’ve got 50 million members. I think it’s an extraordinary number. So huge congratulations on that. It’s an amazing number. And I did read, actually just in preparation for our call. So I knew Brazil was a big country, but I wanted to get some kind of global perspective.
So 217 million is the population according to Wikipedia, fifth largest country in the world by land mass. So it really is a huge country. And you guys are doing amazing work there.
Roberto: Hugely beautiful country. So you should come to Brazil as well as everyone that is listening to us now.
Paula: Absolutely. We will be talking about that in a moment as well.
Tell me, Roberto, about the piece around particularly this super app. So the fact that Dotz is no longer purely seen as a loyalty program, you know, I think a super app is a different business. And I think that’s super exciting because as a consumer, again, I want to remove friction. I want simplicity and I do want the super app.
I actually don’t wanna have 20 apps on my phone to make sure I can connect with every brand that I’m ever gonna shop with. So tell us, when did you start thinking about being a super app and where are you on that journey?
Roberto: First thing, I think it’s important to say that we are evolving what we are doing, but always in the same direction.
As we defined when we, we, we launch, which is, I mean, for, for, for the users. I mean, we, we want to provide them to increase their purchasing power. I mean, that’s our goal. That’s our mission. I mean, that’s the way we, we see our members, they see, we see our users and the partners that we have, the merchants we need drive incremental, incremental results to them.
That hasn’t changed. I mean, that, that’s been the same, the same mantra, the same goal since day zero. What we’ve been doing is that we realize that doing, I mean running and operating the coalition, we would be generating lots of data, lots of users, lots of interactions. And, and, and, and we understood that we could be offering to our members more than just, I mean, being the, the, the, the, the operator that would have versions were to buy, give them points, right?
We, we could, we could have a stronger relationship with our, with our, with our main, our users, mainly again, to, to, to engage them more and also to drive them more efficiently to our merchants. So we decided that we would be moving from a pure loyalty program into what we are calling an engagement platform.
And the Super app is, is a, is the the, the piece that connects the user in a very, in a more mature way, in a very, in a very, in a different way in order to, to, to have them connected to us in a way that we can offer more services, we can offer more value to the consumers, we can. So we, we got into, we got into the, the concept of digitalizing our users into this one single app. Right. Following, following, a lot of the, the, what’s been happening in several culture, like in China, for example, with the Alipay and WeChat in a few other places. Where consumers are con are connected into one single place, but also, I mean, we, we to that a offering of, other services as well.
So we are offering financial services for example. So not only from our partners, but we are connecting other partners. We launch a personal loan. We launched a new credit card. We are, we are launching a BNPL at the point of, say, with our versions to our users. So we are adding, other, other services, always, again, connecting merchants and users.
But having a, a different role that goes beyond only operating the loyalty program. But also having a a a a a a, an ecosystem, which is like the super app and also other services in order to drive more results to, to always stakeholders.
Roberto: We are, I would say we are in the very beginning of that. That’s very, very beginning. We are at the beginning of our journey. We, we, we did our IPO in the middle of 2021. And that was important to, to, to have the funds right to to, to, to start, to start this, this new path. We were, I, I’m glad that we’re, I’m glad that we were able in, in, in, in attracting very, very relevant companies that are investor, such as the, the ENT Group from China, the SoftBank in, in many others.
And we spent the last couple of years mainly building, I’m calling this new engagement platform, building the super app, adding the new financial services, improving the service that we are offering cloud retailers. And we are connecting everything. And I would say the next couple of years are gonna be very important to materialize that this strategy was the right one.
Then the, the execution. It, it’ll be, it’ll be a great execution. So it’s kind of a new Dotz, new Dotz. when you say that we are 23 years old, I, I feel that I was just born and, it’s kinda the new, new Dotz just, just being born now.
Paula: Indeed, and again, I suppose congratulations are in order for a successful public listing.
So there’s not many loyalty programs that go through an IPO, so, and that feels very recent, actually, 2021. So I’m sure it’s very early for you to be, operating as a public company and the various responsibilities and challenges, I guess. Especially that global type of investment in those kind of shareholders.
Again, bringing incredible perspective, the likes of the, the Chinese groups that you mentioned, for example, and SoftBank. These are all super interesting companies and I’m kind of impressed that they see the, the vision and potential for essentially what we said is a coalition program at its heart and they see that as a profitable investment for themselves.
So that gives me quite a lot of reassurance that our industry is doing a lot of things very well.
Roberto: Yeah. And, and then they mainly, I mean, but it’s important to mention Paula, cause they, what they saw is, is not just a coalition itself, right? Cause maybe if we were, if we were just like trying to, to go public just as a coalition program.
I’m sure we, we, we wouldn’t succeed. What they saw was that, the direction that we were planning to, to, to, to go through the coalition as a main engine. That was, that was the great, I mean,trigger for, for, for them. Cause we say we have a very, I mean, in order to build this super app, I mean, concept.
And, and, and this ecosystem. I mean, a lot of companies may, may wanna do that. And, and starting from, from zero, I mean, you have like a very high cost of acquisition investments. We are not starting from zero, we’re starting from a, a coalition loyalty program, right? That we have, we already have a large critical mass.
And, and so, so, so, but on the other hand, what, what unique we, we, we still can have several questions from investors, who else is doing something like that? Right? And the isn’t anyone doing loyalty doing that transformation? And and we are, we are singular in, into that. Which, which in one way is great because if you succeed, I mean, you’re, you’re gonna be the one.
But on the other hand, I mean, it’s deep risk here because it’s not something that you can just follow someone that’s been done that we, we, we are the ones that if, if we succeed, we are the ones that are gonna be followed later on. And, so it’s, it’s very exciting. I mean, it’s, it’s…
Paula: Totally, oh, I mean, it’s so exciting. Yeah, for sure. And the other piece, you, you referenced it a little bit in passing earlier, Roberto, was I suppose with the, the growth does calm complexity. And you’ve already, you know, identified the importance of simplicity and removing friction and the need to educate members. How is that going, I guess is my question?
And as a second question, when I talk about my favorite communications platform, which is WhatsApp, I often hear that WhatsApp in Brazil is an extremely mature market. And so any insights you have in the role of kind of messaging, either to educate or service or support the, the whole Dotz program, I would love to explore anything you’re doing in that space.
Roberto: Yeah. Well, yeah, it’s, it’s the question I was, I was just, I just came from a meeting here that we were talking about, the, the challenge that we are facing in, in educating, I mean the members, I mean, and again, at the end of the day, we are adding more things. For us it’s just more things, but for, for our users, sometimes it’s more complexities, right?
And we, we keep, I mean, debating all the time, testing new things. My view of that is that at the end of the day, we have to be very connected to to, to our mission, to our purpose. Again, everything that we do it is, has to be related. That we are helping our users to increase their purchasing power.
So if we are launching a personal loan, it’s not that we wanna sell a financial product. Is that we are helping our users. Not only if the Dotz currency, but but now we pay personal loan. To increase their purchasing power and buy the things they wanna buy. Right? So sometimes we, we, we, we are, we are, we are like fighting here in order to, in terms of communication, for example, not to communicate the product, but to communicate what we’re trying to sell, but to, to communicate why the product is there. Right.
So you’re not, you’re not gonna be, cause it’s, it’s, most companies what they do is buy this or buy that. Right? And, and we, we need to change, we’re trying to do that here. Not buy this or buy that. If you get this, I mean this is gonna help you to increase your purchasing power to have a a a a more and by order do that you buy this.
So it, it, it’s, it’s a different approach. And, that, that’s, that’s the, the, the, the direction, we are moving into. Again, it, it’s, it’s, communicating communication these days has become harder and harder. Cause there are so many different channels, right?
I mean, email no one is using anymore. SMS, no one likes it to receive it. WhatsApp is huge, but it’s not like a commercial tool. That’s why, that’s why the, the, our, our strategy in really having the super app is also relevant to that point because we would have our users really with us. And, and, and, and we are building.
Trying to build what we call in, build use cases that would increase interactions between transactions. Not only transactions, but yeah, increasing interactions.
Roberto: Within, within between transactions.
Paula: Wonderful, wonderful. The final question I wanted to ask you today, Roberto, was around what you alluded to earlier at the conference in Zurich, which I believe was sensational.
So full credit to the, the whole team behind that. And you said that you did talk, I know on a panel. About the guiding principles for coalition, and I’m guessing that’s kind of future focused and what is going to drive success for Dotz for brands like Payback, for example, and any other coalition programs around the world.
So would you share with us some of your ideas on these principles?
Roberto: Yes, I, I would love to do that. And, and, and just reinforcing what you just said, I mean, the conference was really a great conference and the content was great. I was very positive and suprised to be part, you know, I was happy to be there. As I, as I said, I mean, I’m a triple leader of the coalition.
But on the other hand, I totally understand that, there is a new coalition that needs to be put in place. Horizon in otherwise both companies are, are, most coalition companies are, are not gonna survive. And, and, and cause of that I’ve been working in, in really, I mean, as, as, again, there is, there isn’t a, something someone that has done, had been done before that I can just follow.
I need to create. I’ve mean working on, in, in creating, what is the, this new guiding principles, haven’t finalized yet, but I can share a few of them.
Roberto: And, and, and hopefully sooner than later we, we’ll close that and, and, and focus in implementing. But I mean, things like zero breakage, I mean…
Paula: Wow. Amazing. Yes.
Roberto: As you saying, I mean, democratization of redemption needs to be put in place. I mean, the breakage is a, is a, is a, is one way a revenue is stream. But on the other way, I mean, you’re not, you’re not offering value. You’re not providing value. So we, we, we allow five here have been attacking that for, for some time already.
We are now converting Dotz into cash. So you can convert that into cash and use your wallet.
Paula: Amazing. Yeah.
Roberto: In order to, to spend, so this is one.
Roberto: Another one for partner for example, is going beyond points. I mean, for many years. I mean the relationship between the coalition operator in the merchant works it, selling points. And, and, and, and, and I mean, you have to provide an additional value added to the partners, such as, I mean, insights, real insights, and, and automated marketing campaign. Again, it’s not just about selling points.
Another one is related to, to what I’m calling the partner in control. In control I mean, more of the partner brands as a protagonist, not just, I mean, the coalition itself has to be more equalized, the relationship. And, and, and also, I mean, the way the, the currency is, is, is awarded. I mean, it used to have like, if you buy that specifically grocer, regardless of how much you buy, just an X points per, per dollar spent.
I think this is, I mean, there is a huge dilution into that something like that investment are not really, I mean, the ROI, I mean, suffers a lot, but you, you can, you can, you can allocate more of the investment forwards an incremental behavior. So for example, I mean, if you buy beyond X amount, then you, you, you work much more, right?
If you buy that specific product, making it more variable in a way that, making it more variable in a way that the partner investments are really connected to incremental results, incremental behavior. Because there is a huge, huge,huge, complaints from, from versions that the investments, they are making it, hard to…
Roberto: To understand. I mean, they measure the impact. And again, cause the companies were mainly in that phase of just selling points, right? I mean, sell, sell, sell. It’s hard to, it’s hard to activate. But it’s not hard to, I mean, they, they start to understand it’s not hard to, there are other platforms.
So you have to, to. And, and, and maybe another one is like, again, as I said before, I mean, we are, we are still very complicated, right? The, the loyalty itself and the coalitions are very complicated. So we, we need to, you need, we need to have more simplicity. We, we need to have more, more transparency. We, we need to, to get rid of passwords.
Paula: Yes, please. Yeah.
Roberto: And, and, and, and make, make much, much more like a, a friction fiction. I mean, I have of course like to 14 principles, but I’m still working on maybe in a month from now, we can, we can, we can, we can talk again. I can share.
Roberto: But to that, it goes into that direction again. Today is more value to users. It’s more value to partners. And, and, and, and, and, and that that’s the way it has to happen in order to, to be sustainable.
Paula: Super inspiring, Roberto. And I, I know it’s the first time that we’ve, we’ve had an opportunity to have a, a conversation like this. I really hope it’s not the last time.
And for example, I think I mentioned to you before we came on air that I will certainly be coming to Brazil, for the Loyalty and Awards Conference in Rio de Janeiro. So, hopefully I will see you there and again, hopefully lots of people listening will come and join us and we can continue our conversations because I find it very, inspiring actually to hear about what you’re thinking and to focus on ideas like zero breakage.
I think that’s extraordinary as a vision, as a goal. And, I think there’s lots of ways around the world that people are, are aiming for similar ambitions. So the more we can share these insights and ideas with each other, the more successful I think we’re all gonna be.
Roberto: Yeah, I totally agree. It was a great conversation. I appreciate a lot. Happy to be part. We certainly will meet in Rio de Janeiro, certainly before that we keep exchanging, exchanging knowledge and information and, and I’m happy to, to be part of any conversation that you think it’s gonna be importantly relevant.
Paula: Fantastic, Roberto. So I guess the final question is, first of all, is there anything else I didn’t ask you about that you’re either kind of super proud of and wanted to mention for our audience or, anything else that you think is important before we wrap up our conversation?
Roberto: No, I think we, we covered, we covered it very well. I mean, you, you, you, you, you asked the, the right questions. I appreciate that.
Paula: Okay, well that’s all I need to know. So where can people find you then, Roberto? Is it LinkedIn? Is that the best place for people to connect or the Dotz website? Where do you tend to spend time online?
Roberto: Oh, LinkedIn is, is is a good way and, and my WhatsApp number as well. I’ll be happy to share. No problem. I have to share with your audience. We, we can. We can refer that to.
Paula: I want it. Okay. So that’s, that’s gonna be one, for sure. You can share it offline. And then anybody who needs it, let me know. And I can share Roberto’s contact details.
So listen, it’s been an absolute joy, as I said, I’ve learned so much. I’m excited and so amazed by what you’ve achieved coming from being the Co-founder and of course CEO, and then taking this company from nothing now to a publicly traded company and still with so much more to do.
Very exciting, very inspiring. So Roberto Chade, CEO, and Co-founder at Dotz in Brazil. Thank you so much from Let’s Talk Loyalty.
Roberto: My pleasure again, and, and thank you for, for being a great supporter of loyalty. We, we need more people like you.
Paula: This show is brought to you by the Australian Loyalty Association. The leading organization for loyalty professionals in Asia Pacific. Visit their news and content hub for the latest loyalty insights from around the world. Or why not submit your own article for publication? For more information of their loyalty services and networking opportunities, visit australianloyaltyassociation.com.
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