Paula: Welcome to Let’s Talk Loyalty, an industry podcast for Loyalty Marketing Professionals.
Paula: 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.
Paula: Thank you.
Paula: This show is sponsored by Comarch, a global provider of innovative software products and business services.
Paula: Comarch’s platform is used by leading brands across all industries to drive their customer loyalty.
Paula: Powered by AI and machine learning, Comarch technologies allow you to build, run and manage personalized loyalty programs and product offers with ease.
Paula: For more information, please visit comarch.com.
Paula: So welcome to today’s episode of Let’s Talk Loyalty.
Paula: And as many of you listening will know, I do a huge amount of work in both fuel retail and convenience retailing.
Paula: So I have to say I am extremely excited today to be talking to Olivier Martinet, who’s actually been leading the loyalty programs around the world for BP, otherwise known as British Petroleum, would you believe for over 26 years.
Paula: Now again, many of you will know that BP is one of the world’s biggest and best known companies in this industry.
Paula: They are sourcing and selling all of the fuel that we need to drive our cars.
Paula: And also I think it’s a particularly challenging industry to achieve customer loyalty.
Paula: And I really think that’s because so many people just wish they didn’t have to pay for fuel.
Paula: I think they literally think that we could drive on air.
Paula: So without further ado, I would like to welcome Olivier Martinet to Let’s Talk Loyalty.
Olivier: Hello, good morning.
Olivier: Good morning, Lauren.
Paula: Good morning.
Paula: You’re based in Paris in France, Olivier.
Paula: You’re there this morning.
Paula: How is France doing today?
Olivier: Yeah, we are unfortunately getting into a next phase of COVID.
Olivier: So I’m trying to get through it, but anyway, I guess it’s not the only one.
Paula: Indeed, yes.
Paula: Well, you have plenty of work to keep you going.
Paula: I should mention your full title, Olivier, just so that listeners get a full sense of all of the work you do with BP.
Paula: So global retail customer insights.
Paula: You look after all of the data and loyalty programs globally.
Paula: And you also look after all of the European regional B2C marketing.
Paula: So an extraordinary amount of work.
Paula: I think when we talked the last time, we counted at least 20 different loyalty programs that you’re responsible for.
Paula: And as I said, I think few loyalty, it’s even the stakes, I think, are just higher.
Paula: And there’s so many more, much more expertise, I think, required to really do a good job.
Paula: So clearly you’re doing some incredible work in BP.
Paula: So before we get into all of the programs, as you know, I always start the show asking about my guests’ favorite loyalty statistics.
Paula: And I think you have a few for me.
Paula: So first question off the bat, tell me, Olivier, what is your favorite loyalty statistic?
Olivier: Yes, indeed.
Olivier: You asked me, you pre-warned me of that question already.
Olivier: And I’ve been struggling to find one KPI I have to admit.
Olivier: So basically, I’ve been really kind of picking the three most important ones, the one which we are using day to day, and which I’ve been very much populating inside of BP in all of the countries.
Olivier: So the first one is really around, I would say, the active customer base, is how is this number of active customers evolving over time.
Olivier: That’s the first one.
Olivier: The second one is, it’s to some extent to measure the relevance of my scheme, which is around the transaction coverage, how much of my total transaction numbers are covered within a loyalty transaction.
Olivier: And the third one is very much looking into the evolution of a lifetime value of customers, is therefore kind of, is it, am I getting increased average transaction frequency, average transaction value, where is it going, and what are the kind of next kind of response spend, which I need to put in place basically.
Olivier: So these would be the three critical ones which all my teams know by heart and should be kind of working on.
Paula: Wonderful.
Paula: And are these the ones they, Olivier, because I know you mentioned, you probably measure about 20 KPIs like most companies, but these three sound like they appeal to the senior decision makers, the people who are making the big decisions about investing in loyalty programs.
Paula: So do you report all of these as well up the chain?
Olivier: Yes, absolutely.
Olivier: Absolutely.
Paula: Wonderful.
Paula: Wonderful.
Paula: And I’d love to just get a bit of detail around, particularly the active customer base, Olivier.
Paula: How do you measure active in BP terms in fuel retail?
Olivier: It’s transacted over the last 12 weeks.
Paula: 12 weeks.
Paula: OK, transacted.
Olivier: And this is very much linked to a frequency of site visits, of fuel site visits, which are kind of, the average is every five to six weeks.
Olivier: And therefore, kind of getting, you know, these 12 weeks is quite a relevant one for us.
Paula: Absolutely, yes.
Paula: And I don’t know the percentage of, you know, how many of your fuel stations also have a retail store, but I presume that active base, is that across both sides of that business?
Paula: It is, absolutely.
Olivier: Because part of our strategy is really, I’m not going to, I’m not making any difference between, you know, fuels, convenience, or any other transaction.
Olivier: Basically, this is really on the full, you know, on the full kind of turnover base we are having, yes.
Paula: Yeah, yeah.
Paula: And I guess, yes, if they’re a customer of BP, then they’re a customer of BP, so they all need to be treated equal.
Paula: Yeah, so, I mean, one of the extraordinary things is, as I said in the introduction, in fact, literally how many countries, first of all, I believe BP itself operates in over 80 countries.
Paula: In fact, it seems to be easier to understand which countries you don’t operate in.
Paula: So from a business perspective, I think we said South America and the Middle East.
Paula: So you’re not here with me, and you’re not in South America, but pretty much everywhere else.
Paula: And about 20 different loyalty programs.
Paula: So tell me, I suppose, just to get a sense of them, what is your preferred strategy?
Paula: There are so many different ways, whether it’s a coalition program, whether it’s a BP owned and operated scheme.
Paula: So what would be your favorite structure now?
Paula: If you were going, let’s say, into a new market, what kind of loyalty program do you like to build?
Olivier: Okay, I’m not going to answer directly your question.
Olivier: Basically, because I don’t believe in a set and a preferred loyalty scheme, what I believe in, and specifically because being in a global job, I believe in a framework which I’m applying on a given market.
Olivier: So I’m not coming with a predetermined answer.
Olivier: I’m coming with a framework which I’m looking into, customer base, digital integration, competitor set, our own strength in a retail network.
Olivier: I’m applying this framework, and then coming with a preferred scheme.
Olivier: We are evolving, and basically, to come a bit nearer to your question, we are operating schemes from very basic schemes, kind of plastic card talking only to our BP customer base to kind of multi-scheme environment.
Olivier: And that’s what I know in my world, and people in BP would know it by heart.
Olivier: I’m splitting this in loyalty 1.0, 2.0, 3.0, 4.0, removing 1.0 being BP only, 2.0 being BP with kind of partnership around redemption, 3.0 being around multi-partner environment.
Olivier: And that’s where very often we are finding the, I would say, the coalition schemes.
Olivier: And 4.0 being very much the multi-scheme environment, where basically for the most mature market, we believe that one loyalty scheme is not enough.
Olivier: We need to go to a segmented loyalty approach, targeting each of the segments very specifically.
Olivier: So that’s the evolution basically.
Olivier: And my preferred scheme in there, honestly, is the scheme which is the most relevant for a given market, not over-investing, but being ahead of competition.
Olivier: That’s my preferred scheme.
Paula: Okay, okay, I like it.
Paula: Okay, and I even love the simplicity of 1.0, 2.0, 3.0, all the way up to your multi-scheme.
Paula: And you did tell me, for example, I think it’s in China, you have two loyalty programs.
Olivier: Yes, we have two loyalty.
Olivier: We have two approaches in China.
Olivier: We have in one of the provinces, we have, I would say, a fairly traditional kind of BP scheme with options for customers to redeem in a wide range of partnerships on one side.
Olivier: And we have been entering in another region, we have been entering into a coalition scheme kind of as a starting point.
Olivier: And I guess, and maybe coming back to some, to your initial question is, why would I move from a BP scheme to a coalition scheme?
Olivier: I guess, the move is very much linked to, I would say, the maturity of the market in terms of data and data usage.
Olivier: So it’s not so much the loyalty maturity, it’s more the data analytics maturity.
Olivier: And therefore, the acquisition strategy, the customer acquisition strategy, which I can put behind is, do I need to go to some extent, is it good enough to be Lord at BP and try to attract customers to our own scheme, operate those, optimize this, get high customer participation?
Olivier: Is it still good enough?
Olivier: Or do I need to go into multiple partner and coalition getting the acquisition strategy together and trying to optimize it?
Olivier: And I guess that’s where the balance is coming for me.
Paula: And I wasn’t even aware, in fact, that China was operating a loyalty coalition, Olivier.
Paula: Can you tell me any more about that?
Olivier: Honestly, it’s a very straightforward one.
Olivier: It’s very much kind of for customers to collect their points as every transaction at BP and then being able to exchange risk with a wide range of partnerships, being digital, onsite, et cetera, partnerships.
Olivier: So very basic.
Olivier: And we launched this two years ago, and we have been able within basically six months to hit the 2 million customer base quite quickly, basically, which was quite a big achievement for us.
Paula: Wow, yeah, absolutely.
Paula: Yes, and I can only imagine, I haven’t tried to do any loyalty programs in China myself, Olivier, but there is, I think, so many factors to be considered.
Paula: The multiple languages and really, I think, you need on the ground expertise, in fact.
Paula: So a coalition really sounds like it makes sense, particularly in a country that’s as different to where you’re mainly operating across Europe.
Olivier: Yeah, that’s probably at the heart of our loyalty strategy is this relevance, basically.
Olivier: And specifically when you are a global player, you have two routes to go.
Olivier: Either you go into one route where you standardize everything, and this is the beauty of simplicity and potentially cost optimization, but this comes at the cost of relevance in each of the markets.
Olivier: We have made a choice a long time ago that the relevance would be the absolute kind of focus area and relevance to the consumers, relevance in terms of partnerships, relevance in terms of also scope of issuance and redemption.
Olivier: And basically, one of the things I’m measuring, whether we are successful over time, is this kind of brand differentiation or loyalty differentiation in the market.
Olivier: And this has been really underlying all of it and making sure that basically we get this, accepting on the other side that there is cost, there is complexity, there is we need to get capabilities in each of our countries, et cetera, et cetera.
Olivier: But all in all, honestly, I guess the relevance and the customer acceptance, as I was saying in my free KPIs, is probably where we have been focusing.
Paula: Yeah, I think relevance is absolutely perfect, Olivier.
Paula: We wouldn’t be loyalty professionals if you weren’t laser focused, as I can hear, coming through.
Paula: And it really shows that you do have the local customer in each of your countries very much top and center.
Paula: So that’s really lovely to hear.
Paula: So I wanted to ask specifically about BP.Me, which listeners may or may not be familiar with.
Paula: We have a lot of listeners for Let’s Talk Loyalty in the US, as you know, also in the UK.
Paula: And I only realized actually preparing for today’s call that you now operate BP.Me in both of those markets as the loyalty brand.
Paula: I’m not sure if there’s much difference between the program in order to make them relevant.
Paula: I’m guessing there probably is.
Paula: So I’d love to just mainly talk about, let’s say the UK, if you don’t mind talking us through, what’s the value proposition for your fuel customers in the UK market?
Olivier: In fact, it’s not, we have two things here.
Olivier: We have BP.Me and BP.Me Rewards.
Olivier: And basically, BP.Me is for us the digital platform on which we are going to be building going forward.
Olivier: And it’s a digital platform for loyalty, but it’s also going to be a digital platform for all of the other business areas.
Olivier: And within this, we have, I would say, the loyalty kind of, loyalty.
Olivier: And that’s where BP.Me Rewards is playing a role.
Olivier: For now, what you see in UK is still, I would say, it’s an MVP for me.
Olivier: It’s a minimum viable product as a starting point.
Olivier: And this is really deemed to be evolving over the years.
Olivier: To, I would say, put it clearly, the tension here is to go to a multi-scheme environment in UK.
Olivier: And that’s really kind of starting to target all of my various critical kind of customer segments or customer groups to be really answering their needs.
Paula: Nice, nice, absolutely.
Olivier: And this goes from, you know, what you have today is very much kind of, for our most loyal customers to be able to collect points, rewards and get rewarded for it.
Olivier: That’s the absolute minimum.
Olivier: We have started evolving this to opening the door for also other loyalty schemes, like the one we have with Mark and Spencer.
Olivier: And we are going to be opening it even further.
Olivier: And at the end of the day, then the next phase is really going to be around, you know, more kind of beyond points.
Olivier: And where, you know, points is the basis, which you need to have.
Olivier: It’s almost a hygiene factor.
Olivier: And part of the thinking process is now kind of, obviously, which I’m not going to talk about for competitive reason, but basically the intention is really to be moving to kind of, you know, kind of subscription kind of loyalty environment.
Paula: Okay, well, that’s definitely one of my favorite topics.
Paula: So I’ll pick up on that in a second, Olivier.
Paula: Before that, actually, I thought I’d add in some trivia.
Paula: Just from my own, actually, I wrote an article about BP.me about a year ago when you launched the UK program, because it was high profile.
Paula: My understanding is BP is about a 15% market share in the UK.
Paula: But also the point I made at the very outset was, I suppose, because consumers always have this real perception that fuel is very expensive.
Paula: And I think what most of us don’t realize, I myself really hadn’t realized, in the UK, for example, 72% of the purchase price goes to the exchequer.
Paula: So the taxes and the fees and all of that is really, you know, just taking up the vast majority of what consumers are seeing as the price point.
Paula: So, you know, for your business to still make money and reward your customers out of the remaining 28%, that was a really big eye opener for me.
Olivier: Yeah, it’s, you know, without getting into top secrets, I would say our net margin after everything is much lower, much, much lower than 5%.
Olivier: That’s the, and I’m not going to go into detailed figures, but indeed we are, we are basically the only way for us to be kind of getting into a profitable zone is by having, being a mass marketer to some extent.
Olivier: And that’s the challenge we are having is we are a mass marketer getting into a more personalized marketing environment.
Paula: I was going to say, because, you know, any big corporate that I’ve worked for over the years, Olivier, it’s always this debate of, you know, what’s mass market and what’s, you know, personalized and localized and, you know, how do you get that balance between the individual and the mass market when you’re operating something, something like fuel.
Paula: So, and so that’s super.
Olivier: I have a word for this basically, and that’s been my internal thing.
Olivier: I’m getting into a mass personalized marketer.
Paula: Okay, okay, I like it.
Olivier: And basically, that’s the, it’s not only a word, to some extent, all of the platforms we are building are deemed to this.
Olivier: And it starts from our loyalty platform operations, which is with Comarch, basically.
Olivier: That’s the standard we have across the globe.
Olivier: Yes.
Olivier: This helps us to be standardizing, because as much as I’m kind of looking into the relevance for the end consumers, as much as everything which is non-customer-facing, we have been really standardizing it hardcore.
Olivier: And it started with Comarch, which is our global platform, but it then moves into also automation of our marketing, direct marketing.
Olivier: And that’s what we have been also doing with Accenture, amongst others, is Adobe afterwards in terms of marketing cloud.
Olivier: But that’s really kind of allowing us to target or personalize our marketing efforts at as much as possible, low cost, basically.
Olivier: That’s really the intention.
Paula: Yeah.
Paula: And I know you mentioned already earlier, in fact, Olivier, about the difference between BP.me as a digital platform and BP.me rewards, which is obviously the pure loyalty piece.
Paula: And I think what we’re both seeing, actually, and I’m sure many listeners are seeing, is the increasing convergence of the functional piece around make it easy to pay.
Paula: And I know BP’s done extraordinary work in many markets.
Paula: And we’ll talk about the US as well.
Paula: I know you can pay from the car on your mobile.
Paula: And actually, I was very impressed with your timing.
Paula: I think you guys must have some form of telepathy.
Paula: I think you launched that in January, just before the whole world really, really needed it.
Paula: So well done on having that contactless functionality.
Paula: But yeah, I think the whole point around the merging of payments, the merging of marketing, and the merging of loyalty all into ideally one simple platform at the front end for the consumer, as well as the back end, as you said, to keep the business side just manageable, I guess.
Paula: So it sounds like you’re just doing a lot of work to streamline all of that.
Olivier: Yeah, that’s for me really the heart of this low G 4.0 future facing, but beyond points.
Olivier: And that’s where we have been putting a structure behind it, because it’s not innovation for the sake of innovation, it’s really innovation for the sake of solving a customer problem.
Olivier: And paying from the car is solving one problem, which we have in quite a number of markets, is the speed of transaction.
Olivier: And basically, because we are investing so much in convenience, we tell, and therefore having dual business models, you know, on one side fuel and on the other one convenience, this means that very often our forecasts are quite packed, and therefore the queue and waiting time for customers were getting difficult.
Olivier: And hence, the problem we have been solving there was to say, if we are getting out of the shop, all of the customers who only want to pay, this is going to be creating a differentiated kind of approach.
Olivier: And to some extent, that’s the underlying theme.
Olivier: And all of what we are doing is really trying to understand the customer issue, adding this to a kind of our customer platform on top of what we are doing from a pure reward perspective, to be creating this loyalty on a segmented basis, basically.
Paula: Yeah, yeah.
Paula: And I think what somebody explained to me, Olivier, when I started writing about loyalty and convenience retail, which for me was about three years ago.
Paula: And again, you know, I’ve worked in loyalty with airlines and with phone companies, and they’re all, you know, I suppose sectors where we spend so much money, that it really is worth investing the time to join a loyalty program, particularly as we know, in the airline industry, where the whole loyalty sector started.
Paula: But it really felt, and this particular person explained to me that convenience retail is the last really major retail category, exactly for the point you were just making.
Paula: So in convenience retail, it’s all about removing friction.
Paula: The last thing you want to be doing is adding in, oh, here’s a form to fill out, and here’s something else to do that will add time, because customers have just, they don’t have the mindset in that retail environment.
Paula: So well done, you, and getting the platform technology just to make it super simple for them.
Paula: And can you tell us, Olivier, about your decision in the UK market, which I’m sure many listeners will be familiar with.
Paula: Obviously, you left the Nectar Coalition, I believe that was maybe about two years ago now.
Paula: So I’d love to get a sense of some of the reasons around that and why you felt it was more appropriate for the UK consumer to have a direct BP-owned and operated loyalty program.
Olivier: Yeah, we came to a point where, in fact, we came to a point where the business model, which was behind NECTA, was starting to be, I would say, an issue for our strategic evolution.
Olivier: And basically, we had at some point to make a decision about are we looking into a short-term performance, which is linked to a loyalty scheme, are we looking into that part, or are we taking the risk now to exit NECTA and invest into our future, basically.
Olivier: And the heart of the reason is really about the business model, which is at the heart of what NECTA was doing, which was just not working for us anymore, basically.
Paula: Yeah, I can imagine it must have been a huge decision, Olivier, and a lot of time, a lot of effort.
Paula: And yeah, I’m sure there was a few sleepless nights along the way as well, but seems to be working really well.
Paula: So BP looks fantastic.
Paula: You also mentioned, as I said, something that I’m super fascinated by, and that’s the whole concept of subscriptions.
Paula: Are there particular areas of subscription that you find personally interesting and that you think you might explore in time?
Olivier: Yes, there are things, obviously.
Olivier: There’s a broad subject around, obviously, fuel pricing.
Olivier: And that’s one thing where basically we are looking into subscription.
Olivier: Basically, the intention here is very much to give to some of our privileged customer basis, to give a kind of view or clear transparency on what is the kind of price they will pay and help them in kind of managing their energy bill in a way.
Olivier: And that’s part of the direction we are looking into the US.
Olivier: We have started getting into this, which is we are also looking into the UK.
Olivier: Obviously, as you were saying before, the tax environment is always going to be a boundary here in terms of how much we can afford doing it.
Olivier: But at least it’s a contribution in that sense.
Olivier: Obviously, all of customers would love to have their fuel for free.
Olivier: If I would ask if I’m having a question here anyway, the number one thing for customers would be, can you give me fuel for free?
Olivier: But basically, as you were saying, when you pay 80% tax out of everything, it’s very difficult to make it affordable.
Olivier: So it always will need to be a mixture of something around fuel pricing on one side, and also additional, I would say, services and recognition of our most valuable customers in the system, basically.
Olivier: It’s always going to be a mid.
Olivier: And basically, packaging this into a subscription is where our thinking is.
Paula: Yeah.
Paula: And it’s a great strategy, I have to say, Olivier.
Paula: I’ve seen Pret A Manger launched in the UK recently.
Paula: I’m sure you’ve seen their coffee subscription program, which if anybody hasn’t seen it, 20 pounds a month for, I think it’s up to five coffees a day.
Paula: So you could certainly keep yourself well caffeinated, but I’ve seen it happening in Car Wash, in Canada and in the US as well.
Paula: So there really are lots of different categories that I think subscription is really becoming.
Paula: Yeah, I think it’s actually just very relevant, Olivier.
Paula: I think that’s to pick up on your word from earlier.
Paula: There’s something around, you know, when the world is in perhaps, you know, more chaos than perhaps in the past.
Paula: I think there is something about giving people peace of mind with a subscription or consistent pricing that you’re tapping into.
Olivier: Specifically when you are in a category, which is in a low involvement category.
Paula: Totally.
Olivier: Because energy is not, people are not waking up in the morning and saying, oh, what is, where am I going to fill up today?
Paula: Yeah, I know, I know.
Paula: Is there any other market, I suppose, that you find particularly interesting, Olivier?
Paula: Some of the ones you’ve mentioned to me that you particularly obviously run programs, eight across Europe, South Africa, Poland, I think is your very first market.
Paula: Any other that you think there might be learnings for listeners?
Olivier: Yeah, if I’m looking into the big bets we have been doing, from a coalition perspective, we have a privileged relationship with Payback.
Olivier: Initially, Payback was based only in Germany, but they have been extending, and we are operating schemes now with them in Germany, Austria, Poland, Mexico.
Paula: Oh, wow.
Olivier: So yeah, we launched also last year in Mexico with them.
Olivier: So basically, to some extent, we were talking about Nectar early on UK.
Olivier: Payback has had a different approach and basically two coalitions, and basically they have seen themselves less as I would say, as a loyalty operator and more as a customer engagement platform on behalf of their partners, which means that they have been kind of, I would say, adapting their business model to the various partners in the system.
Olivier: Hence, they globally have felt it kind of easier for us to enter into this.
Olivier: And I would say the partnerships, which I would say the other partners in the system have always been kind of, I would say, being the right balance between the constraints you have in a coalition, you know, exclusivity, but in non-competition, et cetera, with also what you can do from a cross-marketing perspective.
Paula: Yes, yes, yes.
Olivier: That’s one of the big bets we have been making.
Olivier: The other one which we have also been looking into is more kind of, you know, you may have heard that we have been launching in March of this year our loyalty platform in Australia with Comcast.
Paula: Okay, no, I did not hear that.
Olivier: So obviously, this is not, you know, we haven’t made, because of COVID, we haven’t been able to make all of, you know, all of, I would say, some kind of advertising around it, but this is also a very successful first one.
Olivier: And again, we are, because usually airline schemes, you know, I would say partnership for us in an oil environment, I would say the absolute critical partners in the coalition schemes are really around, I would say, convenience, food, and associating it with, I would say, with fuel, high frequency, high, I would say, basket size.
Olivier: And airlines are usually not, you know, kind of, how should I say this, Nadji, are not always kind of bringing us what we need from a customer pool.
Olivier: And we are, there is a benefit to have an airline into a loyalty scheme, but there is a limited benefit for an oil company to have an airline in a scheme.
Olivier: Interesting.
Olivier: If you see what I want.
Paula: Yeah.
Olivier: And basically, that’s the first one.
Olivier: We have been really kind of starting again in Australia.
Olivier: And quite successfully, one of the reasons is because, again, Kantas is not only an airline scheme, Kantas is much more than this.
Olivier: They are bringing in the wealth of their partnerships, convenience, et cetera, et cetera, which is, again, working for us in that environment.
Paula: Wonderful.
Paula: Yes, yeah.
Paula: I was just thinking, I hadn’t heard you doing anything in the airline space.
Paula: I do think it’s much more advanced in Australia, in fact, absolutely, the Kantas program.
Paula: So I’m delighted to hear you’re launching that.
Paula: So is it already up and running, Olivier?
Olivier: Since March, since March of this year.
Paula: OK, so just needs more communication as the situation.
Olivier: Obviously, you know, honestly, despite not being able to advertise it at all in the system.
Olivier: So it has been really internal to Kantas and BP customer base.
Olivier: We are really filled with one, the results, and also the quality of, I would say, the partnership in which we are seeing them.
Paula: Wonderful, wonderful.
Paula: And again, I always really envy people in your position, Olivier, where you have that global perspective.
Paula: So, you know, you can negotiate globally then, really to get the best deal out of coalitions and know what works in one market.
Paula: And make sure you translate that then into building your business in others.
Paula: And just actually to finish on the German side, you mentioned Payback, and I think for all customers of BP, I think that’s extraordinary.
Paula: My understanding is that Payback in Germany has a household penetration, which, if I’m not mistaken, is in the high 90%.
Paula: Would I be right with that?
Olivier: Yes, absolutely.
Paula: Yeah, it’s an extraordinary program.
Paula: So again, I think anyone listening, you know, looking for inspiration on the coalition side, would certainly do well to look at the Payback program.
Paula: The other areas I wanted to touch on with you, Olivier, is around the future, what you’re thinking and what you’re seeing.
Paula: We’ve already talked about subscription as a possibility, but really, I love anything that is innovative, you know, new ideas that you might be exploring, either using new technology or new business models or any new loyalty insights.
Paula: And sometimes I think that might come about partly because of the pandemic.
Paula: I actually think there’s definitely a rethink that consumers are facing.
Paula: I think all of us have had to rethink a lot of things in the pandemic.
Paula: But what do you see in the future, really, for loyalty in general or particularly in the industry you’re in?
Olivier: And again, I’m going to come back to my very initial statement of non-relevance, because indeed, what you are talking about is this beyond point, how are we going to be creating loyalty behavior of customers in a digital, kind of multi-channel environment?
Olivier: Point is one thing, and as I said before, needs to be there.
Olivier: So that’s almost a hygiene factor.
Olivier: What is coming on top?
Olivier: And that’s where I’m not having one single answer.
Olivier: What I’m looking into, what I can say is that I’m looking into, I would say, three different buckets.
Olivier: One is subscription and everything which is around this model, adding services to customers on a segmented basis, which can add value for and answer problems, specific problem of that segment.
Olivier: The second one, which I’m looking into is more about, I would say, it’s more of this relationship, it’s more experience, is how can I, as a customer, get a better experience?
Olivier: How can I fasten my experience, which is a bit, you know, what you can see in quite a lot of food or coffee kind of loyalty schemes, is how can I use this scheme to give these customers an improved, quicker or more rewarding experience?
Olivier: So that’s also one of the things we are looking into.
Olivier: And the last one is more of an emotional kind of aspect, and which you may have seen, we have been doing quite a lot, obviously, during COVID, where we have been also kind of supporting quite heavily the hospital communities, et cetera, and where we have been asking our own customer base to say, if you want, as part of this, you can also support all of these communities.
Olivier: So I would say we are having these three different additional angles, and therefore kind of almost on a country by country basis, defining what is the most attractive or what is the most relevant one and kind of supporting.
Olivier: For example, in Poland, we have been having for quite a long time now this charity about supporting orphan kids, and that’s one of the most attractive partnerships which we have in our loyalty schemes for quite some time.
Olivier: So this is really kind of helping us to help people.
Olivier: Obviously, one of the other big themes, which we see coming more and more and understandably, is also offsetting your carbon footprint.
Paula: Of course.
Olivier: And that’s also something which we are building into more and more.
Paula: Nice.
Olivier: And the thing is, the backbone is technical, but the quicker we can, we are building this into our loyalty platform to be helping customers to help the planet.
Olivier: So this is the kind of stuff.
Olivier: It may not sound as innovative, as fancy, but this is really kind of adding offers in the system which can serve a purpose and then kind of using technology behind it.
Olivier: So it’s really innovation for purpose rather than innovation for the sake of innovation.
Paula: Perfect.
Paula: Yeah.
Paula: And I think you’re right, Olivier, because it’s easy to get excited about new types of technology.
Paula: But the ones that you’ve mentioned, I mean, emotional loyalty, we’ve talked about extensively on the show.
Paula: And again, I think many corporates have, as a company, been donating very well intentioned.
Paula: But the idea of allowing your members of your loyalty program also to donate to charity definitely does drive emotional loyalty.
Paula: So it’s really nice to hear what you’re doing there in Poland.
Paula: The theme of building experiences for members, definitely, again, it’s a very well-discussed topic.
Paula: So I think it’s actually reassuring to hear that we’re all talking about the same things in many ways.
Paula: And we’ve already talked a lot about subscriptions.
Paula: So really good to hear that those are the kind of main focus for you.
Olivier: And again, I was picking on Poland on this example, but as I said, I’m having offers like this across the board.
Olivier: It’s not the same one in each of the regions.
Olivier: No, we’re supporting, for example, in terms of charity, the Red Cross in Iberia.
Olivier: But that’s the underlying theme is really getting to this and getting to this in a relevant way, adapted locally and which is having the biggest impact locally, basically.
Olivier: That’s really the underlying thing.
Paula: Yeah, it’s your mass personalization that you mentioned, I think.
Paula: Yeah.
Paula: Wonderful.
Paula: And just the last coming towards the end now, Olivier.
Paula: Here, as you know, I live in Dubai, and I just have an industry question, which is actually less about loyalty.
Paula: But it’s just something I’ve seen happening here, which may be unique to this part of the world, but I think it might be interesting for listeners.
Paula: But it’s that refueling your car now is being done by delivery, rather than by, you know, literally driving to a fuel station.
Paula: Is that something that BP is doing at all around the world, or is it just something that’s unique to Dubai?
Olivier: No, we have been doing it.
Olivier: Some of our competitors have been doing it.
Paula: Interesting.
Olivier: The issue of this is always coming back to the very initial statement around the level of tax and the level of available margin in every little you are selling.
Olivier: This is really making that business model very difficult to sustain.
Olivier: So either you do it on a very limited customer base, you know, for your high, high range as part of a subscription, and this is the ultimate level of service, but having it as a mass offer across the board is always going to be very difficult.
Paula: That’s one aspect.
Olivier: The second aspect, if you are looking also on the evolution of our model, on our business model, we are going to be driving significantly versus new energies.
Paula: Of course.
Olivier: The new energies being EV, by definition EV, you can charge at home.
Paula: Yes.
Olivier: And also hydrogen or other stuff, which will require different approaches.
Olivier: So I would say it’s a good idea.
Olivier: If we would want to make it global, honestly, it’s probably too late already, because it’s always going to be, it can be relevant for subset of our customers, but making it a mass offer, of course, would probably not be on our side.
Paula: For sure.
Paula: Yeah, yeah.
Paula: I mean, to me, again, not being directly working within the industry in terms of understanding the cost base, it almost sounds like a more affordable than building a fuel station because I can totally imagine what it costs to build a fuel station, you know, rather than deliver the fuel.
Paula: But again, as you said, you know, there’s a window of time where, in fact, I saw a headline which probably shocking for your industry, but where where they said, in fact, peak oil purchasing the high point may have already passed in 2019.
Paula: So as you said, you’re having to reinvent yourself in terms of electric vehicles.
Olivier: That’s exactly what BP is kind of doing.
Olivier: We have been embarking on a reinventing program, which is between now and 2050, where we have been making very firm commitment on kind of carbon impact on it, and which will transform the BP’s business model.
Olivier: That’s very clear.
Paula: Wonderful, wonderful, wonderful.
Paula: So listen, the last thing I wanted to ask you, Olivier, you mentioned to me last time we spoke offline, or off air, that in fact you’re leaving BP after 26 years now at the end of this year.
Paula: So as you’re, I suppose, starting to reflect maybe back on your learnings over that time, particularly as you’ve said, leading global loyalty strategy for an extraordinary period of time, what kind of lessons do you think are the ones that really made the biggest impact on you and you think would be useful for listeners to be most aware of, to be reflecting on for themselves?
Paula: It’s a big one, I’m afraid.
Paula: I should have given you that in advance, shouldn’t I?
Olivier: That’s a big one.
Olivier: Honestly, I guess, probably the one big lesson I’ve learned is that specifically when you are working for a global company, having a one size fits all solution is not going to work.
Olivier: And every single time I’ve seen this, kind of tried to, and not only in BP, but in the whole industry, when I’ve seen such approaches, it always failed.
Olivier: So that would be the one kind of lesson I would keep out of it, is make sure that coming back to the customer relevance, listening to your customers, personalizing it.
Olivier: Either you personalize it at the segment or at the individual size, but make it relevant for each of the customers.
Olivier: And don’t try to solve their problem, rather than try your own solution, find your own solution.
Olivier: That would be, I would say, the one thing I’ve got out of all of these years.
Paula: Wonderful.
Olivier: Very simple, in fact, not rocket science, very simple.
Paula: It’s not rocket science at all, Olivier, but, you know, I think as consumers, we feel it when a company has that intention, when they’re doing their utmost to treat us as individuals.
Paula: And at the end of the day, we’re all human beings.
Paula: So we don’t want to be thought of in, you know, big data terms.
Paula: We want to be thought of as Paula and Olivier.
Paula: So on that note, I want to say thank you so much, Olivier Martinet from BP.
Paula: Thank you so much from Let’s Talk Loyalty.
Paula: This show is sponsored by The Wise Marketeer, the world’s most popular source of loyalty marketing news, insights and research.
Paula: The Wise Marketeer also offers loyalty marketing training through its Loyalty Academy, which has already certified over 170 executives in 20 countries as certified loyalty marketing professionals.
Paula: For more information, check out thewisemarketeer.com and loyaltyacademy.org.
Paula: Thanks so much for listening to this episode of Let’s Talk Loyalty.
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