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: So Sanjeev Nichani is a Loyalty Marketing Professional, and has a fantastic professional background spanning almost 20 years across both retail and loyalty marketing, with the last eight years dedicated to driving loyalty performance for various brands.
Paula: So Sanjeev is living and working in India, and has obviously also worked for some global loyalty brands.
Paula: So he really, for me, perfectly fits the intention of the show to capture truly global insights on loyalty marketing.
Paula: Sanjeev holds an MBA in marketing and strategy, and his loyalty credentials include responsibilities for the loyalty partnerships on what was at the time the world’s largest loyalty program called Freedom Rewardz, which basically caters for over 110 million debit card holders for the State Bank of India.
Paula: So I can’t wait to hear all about that program.
Paula: He has also had a successful role as a director for AIMA in India.
Paula: So obviously AIMA is well known as one of the world’s largest marketing and loyalty analytics firms.
Paula: And now for the last two and a half years, he has been working as head of loyalty for the retail men’s fashion division of an Indian conglomerate called Raymond Limited, which was founded in 1925 and is now a publicly traded company.
Paula: So now I have to confess, I had never heard of Raymond stores until they actually won the award for the best loyalty program in the Middle East, Africa and Asia.
Paula: And that was two years ago at the Loyalty Magazine Awards in the UK.
Paula: And I saw the team speaking about their achievements at the Loyalty Conference as well.
Paula: So I was completely blown away by their story.
Paula: And therefore I’m super happy to have Sanjeev.
Paula: Sanjeev is one of my first guests on the show.
Paula: So Sanjeev, welcome to Let’s Talk Loyalty.
Sanjeev: Hi Paula, thank you so much for having me on the show.
Paula: Fantastic.
Paula: So I’d like to start each show, Sanjeev, with one great statistic about loyalty marketing.
Paula: What would be your favorite statistic about our industry?
Sanjeev: So Paula, what excited me about the field was that considering when I was working at AMIA, AMIA at the time had Nectar as well as Group Aeroplan.
Sanjeev: Both programs were really, really large in their own right.
Sanjeev: And from what I heard at AMIA was that almost three out of every four households in both Canada and Nectar were part of the program.
Sanjeev: So the sheer size of the reach as well as engagement from consumers was what was very exciting for me.
Paula: Wow, my goodness, yeah.
Paula: Well, I mean, that’s extraordinary, three out of four.
Paula: So talk about direct impact on consumers’ lives.
Paula: I mean, that’s really incredible.
Paula: And you had all the access to the data and analytics that went behind all of that.
Paula: So yeah, in fact, one of the reasons I think that I like to work in Loylty is because it’s very commercial.
Paula: And that sounds like something that appeals to you as well.
Paula: Is that fair to say?
Sanjeev: Absolutely.
Sanjeev: So in all the programs that I’ve worked at, I think I’ve always enjoyed the part where it’s been B2C directly.
Sanjeev: I haven’t run too many B2B loyalty programs.
Sanjeev: So the ability to influence the end customer has always been a large part of what I’ve always tried to do.
Paula: Fantastic, fantastic.
Paula: So that’s really exciting as I suppose a mindset.
Paula: And I’m really obviously here to talk mainly about your current role.
Paula: But as I mentioned, you did amazing work with the State Bank of India.
Paula: So I can’t imagine the responsibility of negotiating propositions and partnerships for such a huge database.
Paula: So will you tell us a bit about your work with the State Bank of India?
Sanjeev: Sure.
Sanjeev: Like you said, it’s 110 million consumer base.
Sanjeev: The sheer volume of transactions that we had to process was something that was unheard of in the Indian context, at least.
Sanjeev: When we set out to roll out the program, we knew we wouldn’t make too much money from the bank because it was a public sector undertaking.
Sanjeev: We knew we had to build a revenue model.
Sanjeev: So what we did was we created a partner network.
Sanjeev: And what this partner network allowed us to do was to incentivize State Bank of India card holders to earn accelerated rewards at these merchants.
Sanjeev: And the merchants would pay for these points on accrual.
Sanjeev: So that set up an entire revenue stream for us.
Sanjeev: And I think what you have to understand is that in the Indian context, State Bank of India is seen as, is actually honestly revered.
Sanjeev: The status that occupies in the Indian context is unparalleled.
Sanjeev: There were merchants willing to be a part of the program only if their logo would appear besides the State Bank of India logo.
Sanjeev: And these were guys who were really large in their own right.
Sanjeev: So initially, honestly, it was really easy for us to set up these partnerships because of the fact that it was State Bank of India in the back.
Sanjeev: So when I joined Loylty Rewards, we had about 60 partners.
Sanjeev: When I left them, we had about 350 partners.
Sanjeev: We’d set up both the revenue stream for the company, as well as from a customer perspective, an avenue to earn accelerated rewards across a whole bunch of partner brands that covered spends across their entire monthly life cycle.
Paula: Wow, of course.
Paula: So almost like an instant coalition program from the way you describe it.
Sanjeev: Absolutely, that’s exactly what it was.
Paula: Wow, fantastic.
Paula: And it is also interesting to me that, you know, if there is such a revered brand association, and I always loved that idea of like a halo effect between two partners, it sounds like you could have just gone for a simple media model and just charged those partners just to be present, but instead you chose a performance related relationship.
Paula: So that sounds like a very clever idea and very strategic as well.
Paula: So were you ever tempted just to say, oh, look, you know, we’ll just pay, you know, just charge you to be in there, or was it always just important to drive behavior?
Sanjeev: We initially thought of a model where we just charged the brands to be a part of the entire portfolio where you don’t earn accelerated rewards.
Sanjeev: However, we realized that that effect would have been only temporary.
Sanjeev: That the brands would associate with you for let’s say a couple of months, three months or four months, and then decide to move on.
Sanjeev: So instead, we tried this whole variable engagement model where we said that every time we drive a transaction to you is when you pay us.
Sanjeev: So that worked.
Sanjeev: That worked with the large brands, the smaller brands who initially were circumspect about coming on board, then realized that, look, we’re only paying on performance.
Sanjeev: So it made sense for them to join.
Sanjeev: So we did have a very large long tail.
Sanjeev: But again, the long tail was, didn’t require too much investment in terms of service.
Sanjeev: And it sort of assured us a tiny amount of revenue coming to us without too much of engagement with them.
Paula: And services is a good point actually as well, Sanjeev, because I’ve negotiated partnerships like this myself in the Irish market.
Paula: And it can be very time consuming.
Paula: Did you handle all of these merchant negotiations directly from your team, or did you work with marketing agencies, or how did the even introduction and sales process work?
Sanjeev: So, Loyalty Rewardz started off as a really small company.
Sanjeev: It was a three-member team that actually went and pitched for the State Bank of India program.
Sanjeev: The entire business model was sort of created overnight after they won the pitch.
Paula: Panic.
Sanjeev: Absolutely.
Sanjeev: And that’s when they went and set up a team.
Sanjeev: So when I joined Loyalty Rewards, we were about 50 people strong.
Sanjeev: And these 50 people was basically a two-member team that went out and created these partnerships.
Sanjeev: They created these partnerships initially by looking at the total spend of State Bank of India debit cards and then reaching out to the top merchants.
Sanjeev: However, over time, what happened was that we realized that we needed a much wider bandwidth to be able to reach the number of consumers, the number of merchants we want to reach.
Paula: Yeah.
Sanjeev: And we ended up having a team and we spread the team across the country.
Sanjeev: So that two member team eventually became a 30 member team.
Sanjeev: The 50 member team that I joined Loylty Rewardz as, I think when I left, we were about 360 people strong.
Paula: Oh my goodness.
Sanjeev: Very exciting.
Paula: Yeah.
Sanjeev: Absolutely.
Sanjeev: It was.
Paula: Wonderful.
Paula: Great.
Paula: Well, that’s an amazing background.
Paula: I know you went into AMIA then.
Paula: So tell us a bit about your work with them.
Sanjeev: So I joined AMIA with the intent of relaunching one of India’s largest and oldest loyalty programs, which was the Taj Hotels.
Sanjeev: Now the Taj, when they had launched their program, launched it in a context where they were probably, actually not probably, they definitely were the largest hospitality company in India.
Sanjeev: About 10 years later, what happened was the Marriots and the SPGs of the world came back into India.
Sanjeev: And the context changed completely and the context changed from a bunch of perspectives.
Sanjeev: One was the Indian consumer was now a lot more mobile and therefore was traveling out of the country.
Sanjeev: With international properties present in India, the loyalty programs of those properties became a lot more valuable to that customer because Taj, while it does have some presence across the world, is not as present as a Marriot or an SPG.
Paula: Okay.
Sanjeev: Which is why we had to change the loyalty program to make it far more relevant to the Indian consumer, as well as slightly relevant to an international consumer traveling to India.
Sanjeev: So we did two things.
Sanjeev: One was we decided that we wanted to ring fence our most valuable members.
Sanjeev: So what we did was at the outset, we made the earned proposition much more valuable.
Sanjeev: So from an earned perspective, that program is probably the most valuable in the country.
Sanjeev: It’s not just a country, probably the world today.
Sanjeev: I don’t think you earn, you don’t earn higher at the top tier across any other program than you do at the Taj.
Paula: Okay.
Sanjeev: Yeah, so what we did was we created partnerships with hotels that were very strong regionally, but not strong internationally.
Sanjeev: So we actually had a partnership with Shangri-La, where a Shangri-La member could earn Taj loyalty points in the same currency as the Shangri-La loyalty points.
Sanjeev: So these two things were what we tried to do.
Sanjeev: And then finally we create this whole aspect of experiences.
Sanjeev: Now what the Taj does is that they have unique experiences across each one of their properties.
Sanjeev: Now these experiences actually cost you a pretty penny.
Sanjeev: For signature tier members, which is the top tier, we actually bundled 13 of these experiences into an envelope that would go to him every time he reached signature, and he was entitled to encash any two of them completely free.
Sanjeev: And what happened was we saw usage of these experiences not only increase, but basis referrals.
Sanjeev: It actually drove these experiences up to be used by not just the top tier members, but also by lower tier members.
Paula: Wow, okay, so amazing advocacy and adoption.
Paula: But also, I suppose, back to the same wording almost, it’s a halo effect.
Paula: So experiences, I think, is really where loyalty is going.
Paula: I’ve talked about this with a number of people.
Paula: And if you can actually give people a wow experience, of course they’ll tell their family, of course they’ll tell their friends, and the next time, of course, they want to pay for it.
Paula: So I love that, that was very clever.
Sanjeev: Thank you.
Sanjeev: You did very well and continues to do well, actually.
Paula: I’m sure, I’m sure.
Paula: And again, in the loyalty business, you’re never going to go wrong if you really focus on the most valuable customers every time and really give them a wow experience.
Paula: So particularly like a brand like Taj, I mean, it is globally renowned.
Paula: So great work in AMIA.
Paula: And certainly sounds like it set you up perfectly for Raymond Limited.
Paula: So I guess maybe it would be useful if you introduce the company to our listeners, because I think a lot of people might not be as aware of that brand.
Paula: So yeah, really keen to hear all about what tempted you into this new job.
Sanjeev: Sure, so in fact, what happened was that while I was at AMIA, Raymond was a client for about a year.
Sanjeev: I actually ran Taj and I ran Raymond in parallel.
Sanjeev: The idea with Raymond was that, so Raymond is about 94, 94 years old in the Indian context.
Sanjeev: We started off as a fabric manufacturer and then a fabric retailer.
Sanjeev: We’re still really, really large in the fabric space, where we sell suitings and shirtings.
Sanjeev: And we, for a little while now, we’ve also been in the readymade space.
Sanjeev: We’re number one by a huge margin in the fabric space.
Sanjeev: But because the readymade space is as crowded as it is, we’re still a four-store I can with.
Sanjeev: In total, across the company, we’ve got about 1500 stores spread across the country.
Sanjeev: And the intent is now to penetrate into tier four, five and six cities.
Sanjeev: So that’s been our focus over the last year.
Sanjeev: Now, because of the number of brands that we carry, we said each brand used to have a loyalty program of its own.
Sanjeev: So Raymond as a company used to have about four loyalty programs.
Paula: Okay.
Sanjeev: What we felt was that we’ve internally created a lot of silos.
Sanjeev: However, what we wanted to do was combine all the loyalty programs so that you have the proverbial one view of the customer.
Sanjeev: So from a customer perspective, how it would help them was that they’d be able to earn points across a bunch of brands.
Sanjeev: They’d be able to burn those points much quicker.
Sanjeev: And they’d be able to move up tiers much more quicker, allowing them a bunch of benefits.
Paula: Okay.
Sanjeev: So that was the customer proposition.
Sanjeev: And from us internally, we said it will help drive better analytics, better consumer preference behavior, and market basket and things like that.
Paula: It’s purely menswear brand, is it?
Paula: Sorry, Sanjeev.
Paula: It’s purely menswear?
Sanjeev: It has been predominantly for most part of the Raymond life.
Sanjeev: We have one particular brand, which is Park Avenue, which has a Park Avenue women’s wear line.
Sanjeev: Recently, one of our other brands, Parks, Parks has been our sort of youth brand, and that brand has only recently launched women.
Paula: Okay.
Sanjeev: But if you ask anyone in India what Raymond stands for, everyone will say it’s a men’s wear apparel company.
Paula: Beautiful.
Paula: And it sounds like it targets all segments of the market as well.
Paula: So everything, you know, particularly, as you said, if you’re going down in terms of tier four, five and six cities, then it’s literally from everyday fashion all the way up to, I know, it’s custom premium tailoring as well.
Sanjeev: Absolutely.
Sanjeev: So the Raymond LifeStage starts off at Parks, which is what I just mentioned, where we cater to the youth.
Sanjeev: We then have, we ideally like these customers to then migrate to Park Avenue, which is business formals.
Sanjeev: However, in Park Avenue, what we’ve done is we’ve diversified recently and we’ve got three lines over there, which is work, play and celebrate.
Sanjeev: So these three sort of cover what we ideally like to believe the 30 to 40 year old across his occasion.
Sanjeev: We then like a customer to graduate into Raymond as a brand itself.
Sanjeev: And the parent brand basically has a bunch of offerings.
Sanjeev: And the base offering starts off at the fabric itself, where we’re expecting people to tailor their product.
Sanjeev: Now, when you go to a store, you’d see the Raymond fabric and you’d combine that with what we call Raymond custom tailoring.
Sanjeev: To end up with an end product, which is a shirt or a trouser or a suit or a jacket.
Sanjeev: Now, for those who don’t want tailoring, we have something which is called Raymond Ready to Wear, which is basically Raymond fabric that has been converted into standard sizes.
Paula: Beautiful.
Sanjeev: Again, in parallel, we’ve got Colorplus, which is a premium casual wear brand.
Sanjeev: And on top of all of this, we’ve got something called Raymond Make to Measure, which is basically a service that assures you an end product where you pick the fabric, you’re then given a bunch of try-ons, your fabric is then machine cut, and then delivered to you at hope once it is finished.
Sanjeev: So the advantage of Raymond Make to Measure is that it’s almost always first time right.
Sanjeev: There’s no continuous back and forth with the tailor for alteration and things like that.
Sanjeev: Recently, we’ve launched a new initiative, which is Raymond Khadi, where we’ve taken India’s iconic fabric, which is Khadi, which was popularized by Mahatma Gandhi.
Sanjeev: And we’ve sort of take, we’ve tried to take it mainstream, but because of issues with production, I don’t mean issues.
Sanjeev: What I mean is actually there are constraints to production because it has to come from the weaver community.
Paula: Okay.
Paula: So it’s got a cultural origin as well.
Sanjeev: Absolutely.
Sanjeev: So that brand actually does really, really well at the International Airport.
Sanjeev: We’ve got a store over there, and people who fly out of the airport really appreciate the product.
Sanjeev: They appreciate the history behind it.
Sanjeev: So Khadi is doing pretty well for us.
Paula: Beautiful.
Paula: Yeah.
Paula: And it’s not often, I suppose, that you really get an insight into a fashion brand having such a strong cultural heritage.
Paula: So it almost sounds like every man in India is your target customer, and you seem to be servicing most of them.
Sanjeev: Absolutely.
Sanjeev: We’d really like to.
Paula: Brilliant.
Paula: So you mentioned there were four loyalty programs along the way, and obviously that brought a lot of, you know, I suppose, complexity and, I guess, potential confusion.
Paula: So when was the decision made to combine them into the one program?
Paula: And tell us about that process.
Sanjeev: So in 2016, the management at Raymond said that they wanted to migrate all programs into one, which is why Amia was hired.
Sanjeev: So at Amia, we presented the blueprint for combining all of these programs.
Sanjeev: And while I was at Amia, I was asked by the person I would coordinate with here if I’d be interested in moving over.
Sanjeev: And I said I would because while we created the blueprint, I’d actually be really interested in actually putting all of it together.
Sanjeev: So the largest brand was the brand that we migrated first, which was the Raymond shop, of which we have about a thousand stores across the country.
Sanjeev: And then the smaller brands, which was Color Plus, Park Avenue, Parks, those were the ones that moved in later.
Sanjeev: With the combining of all of these, we currently have about six and a half million members in the program.
Sanjeev: And these people actually contribute to about 80% of our business.
Paula: Phenomenal.
Paula: And I guess, yes, with the previous siloed programs, you just didn’t have insight into exactly how powerful your rewards contribution and your members were.
Paula: So that’s incredible.
Paula: Six and a half million and 80%.
Paula: Really changes the business case and changes the discussion of the board table, I guess.
Sanjeev: Oh, absolutely.
Sanjeev: In fact, the focus on the program now is so large that almost all businesses have been interested in it.
Sanjeev: Everyone uses, they use our team as the central repository for both insights from a consumer perspective, as well as to be able to plan and schedule targeted campaigns every time business is down or business needs a certain push.
Sanjeev: So we’re sort of right in the middle of all of that.
Paula: And it’s a key point as well, Sanjeev.
Paula: I know, again, from a consulting perspective, there are very often, particularly at the early stages, you know, when a company is considering launching Loylty, there’s a lot of questions around what kind of returns can be expected.
Paula: It sounds like Raymond, the management team, already had a very clear vision.
Paula: And, you know, the decision to invest was already there.
Paula: And you’ve been able to prove the results as well commercially.
Paula: So I love to hear that.
Paula: And again, I suppose back to the point we started about, Loylty is so measurable.
Paula: And if you can literally tap into a resource like that at the very outset where business needs it, it’s incredibly effective as a form of marketing.
Sanjeev: So actually, even more so with us, now of the thousand stores that I mentioned, a lot of these stores, majority, 90% of these stores are actually run by franchises.
Sanjeev: We own very few of our own stores.
Sanjeev: When this program was launched, we actually went out and told the franchises that they’d actually have to pay to be a part of the program.
Sanjeev: Now you can imagine the chaos that must have caused.
Paula: I do remember that from the conference actually in London, the discussion.
Paula: What about the franchise?
Paula: How do they respond?
Sanjeev: Not very well.
Sanjeev: There were conversations that went right up to the CEO, from the CEO, it went up to the CMD.
Sanjeev: From the CMD, it came back down to us saying, look, you guys have to do something about it.
Sanjeev: So yes, there was lots of chaos.
Sanjeev: There was lots of confusion for the first about six, eight months.
Sanjeev: I remember the day I joined.
Sanjeev: The day I joined Raymond, I was told that there is a large meeting with agents and you have to be a part of that meeting.
Sanjeev: So I said, look, I’ve just come on board.
Sanjeev: I don’t know what to say.
Sanjeev: But I was told, no, just go and sit.
Sanjeev: So you’re able to understand what the whole furore is about.
Sanjeev: Okay.
Sanjeev: So in that room was the CEO of the company.
Sanjeev: There were about 20 agents and there was me and my team.
Sanjeev: So it was a great first day to get an idea of what the pain points were.
Sanjeev: Yeah.
Sanjeev: However, I think what I think we did was we actually went out and showed them the benefit of running the program.
Sanjeev: We looked at an ROI from the amount of money they were spending before we started this consolidated program and after we started this consolidated program.
Sanjeev: And honestly, when the numbers were up, it was impossible for anyone to argue with it.
Sanjeev: Now, what we went and told the franchisees was that, look, you’ll have to pay to be a part of the program, whether you use the program or not.
Sanjeev: And therefore, it’s in your best interest to use it.
Sanjeev: And with data, what came out very, very clearly was that the franchisees who were engaging in the program were actually seeing a much higher payoff than franchisees who were not.
Sanjeev: We then used this information with franchisees who were not engaged in the program, and we tried to get them to engage in the program.
Sanjeev: So when we started, we had about 60% of franchisees who were engaged.
Sanjeev: As on date, we have about 98% of franchisees who were engaged.
Paula: Brilliant.
Paula: So that’s a B2B relationship, really, I guess, you know.
Paula: So it’s not just managing the direct consumer behaviors and rewards.
Paula: You actually have a full cohort of business owners that are super sensitive, and quite rightly, it’s their business.
Paula: And to enforce something like that is incredibly brave.
Paula: The CEO is obviously a man of great vision.
Paula: And then you’ve obviously got the data and analytics background to be able to prove that argument.
Paula: So how did you leave that first meeting on that day, Sanjeev?
Paula: Did you end up leaving with them convinced or were they just ready to listen?
Sanjeev: So like I said, the person who, the gentleman who led the meeting was the CEO.
Sanjeev: And honestly, like you said, his vision has been incredibly helpful in pushing the program forward.
Sanjeev: So he led the meeting.
Sanjeev: He spoke to the agents.
Sanjeev: He showed them the data and he convinced them that, look, if you want to make an argument, make an argument with the data present in front of you.
Sanjeev: If you’re making an argument that is contrary to what data is telling us, then please prove your point.
Sanjeev: So that meeting went well.
Sanjeev: However, I wouldn’t say that everyone went out convinced.
Sanjeev: So I think what we continue to do on an ongoing basis is we continue to publish that very same report which talks about the ROI of the program.
Sanjeev: However, what happens is that after running the program for a little bit, your ROI starts to drop.
Sanjeev: Now, initially, why we were showing great ROI over the old program, if I’m showing an ROI two years later of the existing program, that ROI tends to drop.
Sanjeev: However, it is still really, really positive.
Sanjeev: And considering the downturn in the Indian economy today, I think from a loyalty perspective, we’re still doing pretty well.
Sanjeev: So I think that’s what’s keeping us going.
Sanjeev: A lot of internal businesses also.
Sanjeev: So we’re a central function.
Sanjeev: We’re a central function because we cater to, like I said, the suitings and shirtting part of the business, as well as the readymade part of the business.
Sanjeev: So we sort of have internal customers.
Sanjeev: And it’s always a tussle to be able to keep them happy, as well as be sort of governing what a customer sees at the end of it.
Sanjeev: Because you don’t want to give him too much information that will confuse him.
Sanjeev: However, you still want to get the most relevant offer out to him.
Paula: Of course.
Sanjeev: So we’ve got internal businesses, we’ve got the franchises, we’ve got a whole host of internal customers to take care of.
Paula: And how big is that team then Sanjeev in terms of managing those internal customers?
Sanjeev: So the CRM team within Raymond is about 12 people.
Sanjeev: However, we also have an agency which enables analytics as well as campaigns for us.
Sanjeev: And that team is basis delivery and not a certain number of people.
Paula: Super.
Paula: And then I suppose just from a proposition perspective, can you talk to us about what are the benefits for members?
Paula: What does Raymond Rewardz offer in terms of the earn and burn proposition?
Sanjeev: Sure.
Sanjeev: Honestly, right now we’re a very transactional program.
Sanjeev: We’ve got three tiers to the program.
Sanjeev: And depending on the amount you spend in a year, you move up tiers.
Sanjeev: It’s not very difficult to move up to the top tier.
Sanjeev: A top tier is 30,000 rupees in a year, which is about less than $500.
Sanjeev: Okay.
Sanjeev: Now, the difference between the tiers is that at the base tier, you earn 0.75 percent.
Sanjeev: At the middle tier, you earn about 1.5 percent, and at the top tier, you earn about 3 percent.
Sanjeev: Okay.
Sanjeev: There are the standard benefits, which are benefits during your birthday, benefits during your anniversary.
Sanjeev: And we then have a bunch of benefits for our top tier, where if a customer moves to top tier, he gets a certain welcome benefit into that tier.
Sanjeev: Also, because we have a bunch of categories at Raymond, we’d like our customers to try all our categories.
Sanjeev: We have a lot of people who buy only shirts with us.
Sanjeev: We have a lot of people who buy only trousers with us and don’t tend to buy the other category.
Sanjeev: So, we’ve got one benefit, which is shop across five categories and you get bonus points.
Sanjeev: So, that we’ve introduced recently just to try and get customers to try more categories.
Sanjeev: And the one area where we thought we needed a bit of a push because it was something that we branched recently across all our brands, which is accessories.
Sanjeev: So, you earn twice your regular earn rate on accessories.
Sanjeev: So, that’s sort of…
Paula: Yeah, again, the business driving adoption and again, very clever.
Paula: Once people start buying their accessories from you, then I suppose that becomes a habit as well.
Paula: So, you know, you can incentivize in the short term and enjoy a long term return on that.
Sanjeev: Absolutely.
Paula: Wonderful.
Paula: And you made a point there, Sanjeev, that it is quite a transactional program.
Paula: And I know your background, as you said, from the hotels and hospitality is very much around experiences.
Paula: So, are you thinking about experiences in the context of Raymond?
Sanjeev: We are, actually.
Sanjeev: However, we believe that it may not be necessary to offer experiences to the entire consumer base.
Sanjeev: So, like I said, two of our brands are really premium, which is Raymond Ready to Wear, as well as Raymond Make to Measure.
Sanjeev: We’ve been thinking of, for some time now, to create a separate, maybe tier or a separate program itself, where we look at this set of consumers, and they’re not very large, it’s a small consumer set, and to be able to offer experiences to this consumer segment.
Sanjeev: So that is sort of in the works right now.
Paula: Lovely.
Paula: Yeah.
Paula: So there’s an element of exclusivity there, which it sounds like will really tap into those consumer needs.
Paula: So yes, but it doesn’t need to be done at scale.
Paula: It can very much be done in an exclusive way.
Sanjeev: Absolutely.
Paula: Wonderful.
Paula: I’d love to ask you, Sanjeev, about just what kind of KPIs you mentioned.
Paula: So six and a half million members you’ve already mentioned.
Paula: What do you measure?
Paula: Is it the engagement?
Paula: Is it just the overall returns over a year?
Paula: Or how do you measure the performance of the program?
Sanjeev: So we definitely track our repeat member frequency as well as repeat member spend per month.
Sanjeev: And that’s important to measure the health of every brand.
Sanjeev: So we’ve honestly got brands where our repeat member contribution is actually as high as 80%, which is not great for the brand.
Sanjeev: And then we have a repeat member contribution as low as about 40% for a brand.
Sanjeev: So at an overall program level, we’re still well off.
Sanjeev: But however, when we start to deep dive within each brand, we realize that there exists a wide range.
Sanjeev: So we’re trying to sort of address that issue on an ongoing basis.
Sanjeev: And then the other metrics that we track are obviously a customer’s basket size as well as the categories the customer is buying from us.
Sanjeev: So very standard to Loylty is get the customer to come more often and get them to buy more.
Sanjeev: So these two things are what we honestly try and do on an ongoing basis month on month.
Paula: Fantastic.
Paula: And I know what a lot of people are talking about as well, Sanjeev, is starting to look at other behaviors such as social behavior, for example.
Paula: Is that something you’ve thought about in the context of Raymond Rewards?
Sanjeev: We have, actually.
Sanjeev: We have a bunch of pilots going on with a lot of startups, all of them who offer us different things in the social space.
Sanjeev: For a very, very long time, we used to communicate to consumers only via SMS.
Sanjeev: We recently switched over to going a lot more digital, a lot more social than we ever did.
Sanjeev: So we’re now reaching consumers on Facebook, on Instagram, on LinkedIn, on the Google Display Network.
Sanjeev: And the reason we started to do this is because the kind of brand that we are, I think we’re a lot more visual than just transactional.
Sanjeev: You need to be able to show the customer design, styles, fits for him to actually truly understand what Raymond is as an offering.
Sanjeev: So while our repeat consumers may actually be aware of what Raymond is and what Raymond has to offer, I think the consumers who flirt with us, which is our one-timers, are people who still need a lot of awareness about Raymond as a brand, Raymond as a proposition, which is why we’ve gone a lot more visual.
Paula: Wonderful.
Paula: I like your turn there, so I think I’ll adopt that one, Sanjeev, into my vocabulary.
Paula: So flirting, customers who are flirting with you, I think that’s hilarious.
Paula: Lovely.
Paula: Yeah, no, absolutely.
Paula: It’s a very specific type of behavior and one that needs to be captured and monetized.
Paula: So that’s brilliant.
Paula: And to your point around going digital, I didn’t actually even ask you, do you issue plastic cards for your Loyalty members, or is it an app-based program, or what level of sophistication are you at for tracking?
Sanjeev: It’s currently a mobile member-based program.
Sanjeev: We don’t have a card.
Sanjeev: We used to have a card a long time ago with the earlier program, but then we got rid of it because we realized two things.
Sanjeev: One is it’s a cost, and the second is that a customer doesn’t carry it when he walks into the store.
Sanjeev: He just refers to his mobile number.
Sanjeev: There is no app yet, but the intent is to build one.
Sanjeev: We’ve sort of designed what we believe our app should have from a feature set perspective.
Sanjeev: We just have to find the right person to be able to build it.
Sanjeev: So that search is on currently.
Paula: Wonderful.
Paula: And as we’re talking about technology then, what platform do you use to manage the entire program?
Paula: Is it the AMIA platform, given where you came from, or did you build one in-house, or how do you manage everything?
Sanjeev: No, so it’s not the AMIA platform.
Sanjeev: It’s not in-house either.
Sanjeev: So like I mentioned, we work with an agency.
Sanjeev: The agency has a proprietary platform, and that’s the platform that we use.
Paula: Fantastic.
Paula: Okay, perfect.
Paula: And I guess that’s probably being evolved and customized to your requirements, given the scale of the program.
Paula: So yeah, sounds like you’ve got a very good solution there.
Sanjeev: It is, but I think in one of our previous conversations, I’ve also mentioned to you that we’re looking to move ahead with what our vision from a company perspective is at a 2025 sort of timeframe.
Sanjeev: So in that, what we’ve done is we’re looking to try and do as much as we can in-house because it allows us to turn things around much quicker.
Sanjeev: As well as respond to what a customer is looking for, literally within seconds.
Sanjeev: So from that perspective, we’ve started this process where we’ve evaluated Microsoft and we’ve evaluated Adobe.
Sanjeev: And that’s what we’re trying to go out and launch.
Sanjeev: In fact, Project Kickoff is as recent as next week.
Sanjeev: And hopefully in about six or eight months, we should go live with this.
Paula: My goodness.
Paula: So I will have to put you on my follow up list to have a second podcast interview to basically see how that whole went because it is a big undertaking.
Paula: And certainly coming from your experience, it’s going to be very exciting.
Paula: But to have that level of responsiveness and personalization within seconds, I think that’s a huge vision.
Paula: So yeah, very impressive to hear.
Paula: I’d love to just chat then Sanjeev about your communication.
Paula: You’ve already mentioned SMS.
Paula: Do you use any other form of communication?
Paula: Emails, for example, or is it purely SMS based, given that, as you said, you don’t have an app in place just yet?
Sanjeev: We do emails as well, but the amount of emails we do are almost insignificant compared to the amount of SMSes that we do.
Sanjeev: There is this entire question about whether SMSes are as effective, but we do believe that they are, because the minute we send out a campaign which has some sort of incentive, and I’m not joking about this, but you literally see lines build up at stores.
Sanjeev: We’ve not seen that sort of response with emails, which is why the number of emails are probably 5% of the overall communication that we do.
Sanjeev: Now, yes, SMSes are far more expensive than emails.
Sanjeev: Less engaging.
Sanjeev: Also, SMSes have now become a blind spot.
Sanjeev: Almost all of us, the minute we get an SMS, we just swipe it off our screen.
Sanjeev: But we believe that the kind of brand we are and the kind of people that we attract, especially in tier 2, 3, 4, 5 cities, I think those people are sort of hooked on to messaging and what we’re trying to do right now is actually get messaging out in local language.
Sanjeev: So hopefully that will help drive conversion for us.
Paula: And messaging, you mean SMS messaging, so sticking with the messaging format?
Sanjeev: Yes, that’s right.
Paula: So because as various markets around the world are obviously evolving on various app-based messaging platforms, it will be amazing to see whether we can start doing this kind of thing on WhatsApp or WeChat.
Paula: So yeah, certainly in our follow-up interview, I’ll be keen to hear more about that piece as well.
Paula: So just a few final questions, I think then, Sanjeev.
Paula: I suppose I wanted to ask about challenges.
Paula: What do you find maybe keeps you awake at night?
Paula: Is it internal problems or external challenges?
Paula: What do you think you spend the most time trying to fix?
Sanjeev: So I think the issues we have right now revolve around data consistency and data quality.
Sanjeev: And by that, what I mean is that…
Sanjeev: Now, picture a store, right?
Sanjeev: Now, in that store, let’s assume that there are four or five customers who walk in.
Sanjeev: Now, when the customer walks up to the billing counter, that is the time when he mentions his mobile number as part of his loyalty program.
Sanjeev: At that time, what happens is that, let’s say that his email ID has not been captured.
Paula: Okay.
Sanjeev: Now, what tends to happen is that we Indians tend to have slightly complex names, which can be spelt in a multitude of ways.
Sanjeev: Now, when the store manager is actually capturing his email ID, there is a chance that he captures an incorrect spelling or an incorrect domain.
Sanjeev: Yeah.
Sanjeev: So, the lack of an email ID reduces my ability to communicate to him via email, as well as target him on social media.
Sanjeev: So, that is one problem we’ve been trying to solve.
Sanjeev: In a lot of instances, we even have incorrect names.
Sanjeev: Now, if I send an SMS to a customer with an incorrect name, that’s going to be a terrible customer experience.
Sanjeev: So, we don’t want to do that.
Sanjeev: So, we constantly try and revalidate that from a customer perspective.
Sanjeev: But again, response to those campaigns aren’t great.
Sanjeev: So, there is only so much accurate data that we’ve got.
Sanjeev: So, that is one constant challenge that we’ve been trying to face, which is how do we get accurate customer data?
Sanjeev: The other thing that we’ve been trying to do is, now the data that we have is purely transactional.
Sanjeev: We are only aware of what the customer is buying and the attributes of that product.
Sanjeev: We have no idea what the customer is buying from competition, whether his needs from competition are exactly the same or any different from what he buys from us.
Sanjeev: And apart from competition, what his general likes and dislikes are?
Sanjeev: For us to be able to communicate more effectively to him or for that matter, even offer him an incentive that is relevant to him.
Sanjeev: So, like I mentioned earlier, we’re working with a bunch of startups in that space with whom we’re promised to be able to help augment customer data that will help us drive relevant campaigns.
Sanjeev: So, that is something that we’ve been actively trying to do over the last few months.
Sanjeev: In fact, another thing since you…
Sanjeev: Sorry.
Paula: Go on.
Paula: Yeah, no, tell me.
Sanjeev: So, since you mentioned WhatsApp, we actually have a WhatsApp implementation in place right now.
Sanjeev: And hopefully, we’ll go live by the end of the month.
Paula: Brilliant.
Sanjeev: But WhatsApp right now is purely transactional.
Sanjeev: It doesn’t allow any promotional messages on the platform.
Sanjeev: So, the use cases that we have for it are basically engagement with the customer, allowing him to access his point balance, a store locator, an electronic bill facility, and things like that.
Sanjeev: So, anything that’s transactional, feedback about his experience at our stores.
Sanjeev: So, we actually have a system by which right after he makes a transaction with us, he sends communication via SMS, and he’s asked to rate us on a bunch of parameters.
Sanjeev: So, that communication, while it goes out on SMS right now, will go out on WhatsApp by the end of the month.
Paula: Fantastic.
Paula: And I think I mentioned WhatsApp because I guessed that given how progressive you are, that that was definitely going to be on your radar.
Paula: So, super exciting to hear about that.
Paula: And actually, just on the point, I also like what you mentioned, Sanjeev, about knowing where the customer is shopping when they’re not shopping with you.
Paula: And in the show notes, I’m going to just post a link to an article I wrote in a completely different sector, but it was Domino’s in the United States.
Paula: And their Super Bowl campaign this year, I thought was phenomenal from a loyalty perspective, because what they did was they rewarded any pictures of pizza that customers submitted.
Paula: So, they used artificial intelligence, but it didn’t matter whether you baked the pizza at home yourself or you went to a competitor.
Paula: If you were eating pizza on the Super Bowl day and told Domino’s about it, you would get rewards.
Paula: So, they were almost self-identifying as potential customers interested in pizza.
Paula: And it’s just, I think, a really relevant idea in terms of you understanding, how can we understand where else people are shopping in terms of their menswear.
Paula: So, I’ll certainly put that in the show notes for you to have a read of.
Sanjeev: So, we’ve got something like that in the works right now, but like you said, that’s conversation for a follow-up chat.
Paula: Fantastic.
Paula: Wonderful.
Paula: So, just the last few then, I’d love to just ask about the Loyalty Magazine Award.
Paula: You got that, I think it was last year.
Paula: I was certainly at the conference.
Paula: So, I think it might be the first time you guys even entered the award.
Paula: So, tell us, do you work with awards at all or was this your first time?
Sanjeev: So, we’ve engaged with a lot of Indian awards in the past.
Sanjeev: That was honestly one of our first ever entries internationally.
Sanjeev: And we were honestly quite surprised and pleased to have won that at that stage.
Sanjeev: We haven’t done much internationally since.
Sanjeev: However, the agenda this year is to do a lot more.
Sanjeev: But in the Indian context, yes, we do submit our entries to a lot of these juries and we have won a significant number of awards in the last couple of years.
Paula: Amazing.
Paula: Yeah, I’m a big fan of PR, so anything we can do to build our own reputation, even internally, I think is super important and we don’t always make the time for it.
Paula: So I’m certainly pleased to hear about that.
Paula: So tell me, Sanjeev, any, I suppose, trends in loyalty marketing that you’re thinking we should also talk a little bit more about or have we covered them all off with the various experiences and WhatsApp and all of the things we’ve talked about?
Paula: Is there anything else that we should be thinking about?
Sanjeev: At least from a Raymond perspective, I think what we’re trying to do is we’re trying to be just present in wherever a customer is looking for us, which is why I mentioned the whole digital bit, the whole social bit.
Sanjeev: We’ve seen a lot of search, at least in India, in the tier one cities move online, which is why we want to be there, and we haven’t done a great job of it, so we’re trying to change that for us.
Sanjeev: And to be able to be present in channels where a customer is willing to give you some sort of space.
Sanjeev: Why we’d like to be doing a lot of communication on WhatsApp of our campaigns, we realize that it’s going to be much more intrusive than an SMS, which is why we don’t want to do it right now, which is why we’re happy to stay with just transaction.
Sanjeev: However, when WhatsApp allows us the ability to do that, we do intend to do it.
Sanjeev: However, we don’t intend to go overboard with it.
Sanjeev: Because it doesn’t take much for a customer to block you today.
Sanjeev: For sure.
Sanjeev: So we don’t want that to happen.
Sanjeev: We want to engage.
Sanjeev: We want to be present when he’s looking for us.
Sanjeev: We don’t want to be too intrusive.
Sanjeev: So that’s sort of what’s governing our channel as well as spend preference.
Paula: Yeah, and I think that point is lovely.
Paula: Actually, Sanjeev, it is around integrity and being welcome.
Paula: And, you know, I’ve often mentioned my favorite loyalty marketeer, Seth Godin.
Paula: You know, he talks about permission marketing.
Paula: So, you know, spam, I think, is a very old fashioned and dated mindset.
Paula: So, yeah, very important to make sure that you’re welcome.
Paula: And with beautiful products like yours, like I can absolutely imagine, but I would want to see the beautiful visuals coming in.
Paula: But again, absolutely, with sensitivity around, you know, we’re all busy people.
Paula: So I don’t want it every day from you.
Paula: So really, really important to get that right in terms of the frequency.
Paula: And then just in terms of loyalty resources, Sanjeev, do you have any that you use either, you know, in the Indian market or any, you know, international resources that you follow that you can recommend for listeners?
Sanjeev: So, again, in the Indian context, like I said, we don’t have too many of these resources.
Sanjeev: The one I tend to read up a lot of is, Forbes actually has a section which talks about loyalty.
Sanjeev: I think that happens every Friday.
Sanjeev: So I read that.
Sanjeev: The agency we work with puts out some information on a quarterly basis.
Sanjeev: And they, because they work with a bunch of clients in the Indian context, it sort of gives you a view of loyalty across industries.
Sanjeev: So that’s helpful.
Sanjeev: And we then get a lot of information from Adobe and Microsoft, which I mentioned, because of the other guys we work with currently.
Sanjeev: So lately, we’ve been getting a significant amount of information globally as well as domestically from them.
Paula: Wonderful, wonderful.
Paula: And as we finish up, is there anything else that we haven’t covered that you’d like to add?
Sanjeev: No, I think we’ve got it all.
Paula: We’ve done amazing.
Paula: And, you know, I suppose then just if people do want to follow up directly with you, I know you’re on LinkedIn as Sanjeev Nichani.
Paula: Is there anywhere else that people can get in touch with you or is LinkedIn your preferred communication?
Sanjeev: LinkedIn is preferred, yes.
Paula: Wonderful, wonderful.
Paula: Well, listen, Sanjeev, I think we have covered so much more than I even hoped.
Paula: It’s been an extraordinary conversation.
Paula: I really want to thank you for your time, for your expertise, and really for your contribution to our industry because I think it’s only when people are really delivering results like you are that we can all kind of go and really be proud of the work that we achieve.
Paula: So thanks a million and best of luck with Raymond Rewards going forward.
Sanjeev: Thank you so much, Paula.
Sanjeev: Again, thank you for having me.
Paula: Thanks so much for listening to this episode of Let’s Talk Loyalty.
Paula: If you’d like me to send you the latest show each week, simply sign up for the show newsletter on letstalkloyalty.com, and I’ll send you the latest episode to your inbox every Thursday.
Paula: Or just head to your favorite podcast platform.
Paula: Find Let’s Talk Loyalty and subscribe.
Paula: Of course, I’d love your feedback and reviews, and thanks again for supporting the show.
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