#86: Coalition Loyalty in Colombia with Puntos Colombia

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: 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 the latest episode of Let’s Talk Loyalty.

PAULA: And today I am delighted to be doing my very first episode with a guest from either Latin America or South America.

PAULA: So I want to thank our friends in Comarch for introducing me.

PAULA: And today I have Alejandro Gonzalez Saul, who is the CEO at Puntos Colombia.

PAULA: So first of all, Alejandro, welcome to Let’s Talk Loyalty.

ALEJANDRO: Hola, I’m glad to be here with you.

ALEJANDRO: Thank you very much.

PAULA: Wonderful.

PAULA: And I know you’re from Mexico originally, Alejandro, and I’m super happy that you speak English so beautifully.

ALEJANDRO: Thank you very much, Paula.

ALEJANDRO: Yes, I was born and raised in Mexico City.

PAULA: Wonderful, wonderful.

PAULA: And we’ll talk about your experience there because I know you worked on loyalty programs in that country as well as Columbia now.

PAULA: So we’re going to talk all about Puntos Colombia.

PAULA: But before we get into your loyalty program, tell me first and foremost, what is your favorite loyalty statistic?

ALEJANDRO: Yeah, Paula, that is a very tough question because as you know, loyalty programs are, you can measure and track a different kind of KPIs and metrics and that was very exciting in a loyalty strategy.

PAULA: Yes.

ALEJANDRO: But if I can choose one, I would say that my favorite KPI to measure the loyalty performance in a program is MPS, the Net Promoter Score.

ALEJANDRO: Let me tell you why, Paula.

ALEJANDRO: Let me tell you why this is for me the most important measure.

ALEJANDRO: It’s because this metric can show you different and relevant aspects of the program.

ALEJANDRO: MPS can deeply know most of the important aspects in the loyalty strategy.

ALEJANDRO: In Puntos Colombia, we measure the MPS in different interactions with the members.

ALEJANDRO: For instance, we measure MPS when the member just reading points and we want to know his or her experience on that redemption process.

ALEJANDRO: We also measure the MPS when the member, for instance, is interacting or they had an interaction with our marketplace when they call us to the contact center as an example.

ALEJANDRO: So at the end, we have an overall MPS statistic just to know if the member is happy and satisfied with the program.

PAULA: Wonderful.

ALEJANDRO: Because if you think, Paula, a loyalty program or a loyalty strategy at the end is all about having happy members.

ALEJANDRO: And if these members are happy with the program, with the value proposal that the program is offering them, they would recommend to other families or friends.

ALEJANDRO: So no, a person does not recommend the service or product if the experience or quality is poor.

ALEJANDRO: The member only recommends if they are happy and in love of the program or in love of the value proposal.

ALEJANDRO: So this is our favorite statistic.

ALEJANDRO: And just to complement Paula, we are in Puntos Colombia, we are measuring the member MPS.

ALEJANDRO: And this year, we will start measuring also the MPS for our allies.

ALEJANDRO: In other words, for all the brands that are inside the program, we want to know what is the MPS of these allies and if they are happy or not with the Puntos Colombia proposal.

PAULA: Wonderful.

PAULA: My goodness.

PAULA: Yes, Alejandro, I know, for example, I was looking at the whole website for Puntos Colombia, and I know it is a coalition program.

PAULA: Colombia, I had to check your population.

PAULA: I believe you have about 50 million people.

PAULA: And I saw you describing the program as an ecosystem of over 80 brands.

PAULA: And I really liked this actually as well in your description, Alejandro.

PAULA: It said that it’s brands that create stories between them.

PAULA: And that obviously then the shared data allows the relevance, which I think then absolutely drives your MPS score.

ALEJANDRO: Exactly, Paula.

ALEJANDRO: Yeah.

ALEJANDRO: The thing that we wanted to create in Puntos Colombia, as you mentioned, is a coalition between different brands.

ALEJANDRO: At this time, we have more than 100 brands inside the program.

ALEJANDRO: All these brands can offer benefits to the members, benefits in the earnings side, and also benefits when the member decides to redeem these points.

ALEJANDRO: At the end, we are talking about points.

ALEJANDRO: Our coin, it’s called Puntos.

ALEJANDRO: And so we think in this way, it’s very easy to communicate what is the value proposal of the program in terms of points.

ALEJANDRO: So we wanted to create an ecosystem.

ALEJANDRO: And I will tell you why this is an ecosystem and not just a coalition of different brands.

ALEJANDRO: Because as you mentioned, we’re using data, we’re using deepening customer knowledge to know about the customer or the member preferences and habits.

ALEJANDRO: And once we know these preferences and habits, we use them to connect all these members’ preferences using data into communication.

ALEJANDRO: Let’s say that you as a member wants to buy a coffee every morning and then twice per week, you go to the supermarket and buy some different brands inside the supermarket.

ALEJANDRO: So on this data collection, we use it to create a personal history for you and different for the rest of the members in the program.

ALEJANDRO: So all of this is coming from data, customer knowledge, and then we transform this into a personal history through our different communication channels.

PAULA: Beautiful.

PAULA: And there was another quote, Alejandro, and I will make sure to link to some of your articles.

PAULA: I know you’ve written a couple of articles on LinkedIn and you were talking actually about advocacy.

PAULA: And I can see that kind of love of the customer coming through and what you’re describing.

PAULA: And there’s a great sentence actually that you wrote, and I’ll read it if you don’t mind for the listeners.

PAULA: And you described it as it must be a slow, patient, and dedicated process of falling in love.

PAULA: And I thought that was a beautiful way for a brand to perceive its customers and its members as have an intention of making sure they fall in love with you.

ALEJANDRO: Absolutely, Paula.

ALEJANDRO: Yeah, at the end, our final objective on the program is exactly to have advocacy in our members or members who becomes ambassadors of the program.

ALEJANDRO: If you think a coalition strategy or a coalition program with different brands is a challenge because at the end, you have to position not only the program, but at the end, the brand that is inside the program.

ALEJANDRO: So that is a challenge, but it’s not difficult or it’s not impossible to achieve.

ALEJANDRO: You have the correct data and use this data respectively, of course, having the member permission to use it, and then use this data to transform the transaction into a motion connection.

ALEJANDRO: And then at the end, with patience and time, you will have ambassadors instead of members.

ALEJANDRO: So it’s a very interesting process.

ALEJANDRO: It takes time, but it’s not impossible to create it.

PAULA: Yeah.

PAULA: And I think you’re probably the first guest I’ve had on the show, Alejandro, that really has made me think about the advocacy piece so much.

PAULA: And I’m a big believer in net promoter score.

PAULA: I myself wrote a couple of articles, and I’ve talked about it on the show before, but I think the reason I like it, and I think why you like it as well is it’s almost like the members putting their reputation on the line.

PAULA: So as you said, they can be happy with the transaction.

PAULA: They can be comfortable.

PAULA: They can be complacent.

PAULA: But actually, if they start becoming ambassadors, that’s extraordinary for a business.

PAULA: And I know you have a list of benefits that really we should be thinking about as an objective for our programs.

ALEJANDRO: That’s correct, Paula.

ALEJANDRO: Yeah, having ambassadors instead of just transactions or members transacting to a program, it will tell you that the program is having a good value proposal for them.

ALEJANDRO: The NPS also is measuring the experience that the member is having in all the different, with all the different interactions inside the program.

ALEJANDRO: And at the end, as you mentioned, if the member is happy, if the member is having a good response in all of the contact with the program, then they would recommend their experience to their friends, to their family.

ALEJANDRO: And as you mentioned, this is a sharing their, I mean, they are sharing their experience, and at the end, this is a reputation for them because they would recommend a good experience or not.

ALEJANDRO: Yeah.

PAULA: Yeah.

PAULA: And I’ll ask you one which you might not want to answer, and if so, that’s okay.

PAULA: But I don’t think it’s too commercially sensitive.

PAULA: Just as an indicator, you don’t have to say for Puntos Colombia directly, but for a coalition program, if you were reviewing one, what would you say would be a good NPS score?

ALEJANDRO: Yeah, this is a very interesting question, Paula.

ALEJANDRO: And maybe it’s a little bit difficult to answer, but no, I would say that I would satisfy if our NPS is above 70%.

ALEJANDRO: Yeah, 70%, 70% as an NPS.

ALEJANDRO: Yeah, I would say that everything above that number, it will tell you that you are in the right direction.

ALEJANDRO: Of course, it’s not the final number.

ALEJANDRO: You will want to improve this over the time.

ALEJANDRO: But if you have 70 or more, I would say that you are on good track to have a good NPS.

PAULA: Wonderful.

PAULA: Yeah.

PAULA: And that’s brilliant.

PAULA: Thank you for that, Alejandro, because as I said, I’m always keen just to share the knowledge.

PAULA: And that’s the whole point of this show, because when I was running loyalty programs, I was always frustrated.

PAULA: I couldn’t ask anybody, you know, what a success looked like, because nobody else knew my industry, for example, or knew my market.

PAULA: So that’s super, super useful.

PAULA: I saw another thing that you talked about as well, Alejandro, which was something that was being discussed when I was running loyalty programs, but that has been a few years.

PAULA: And I’d love just to get your insights on whether it’s already happening.

PAULA: And it’s the idea of social listening.

PAULA: And I think what you were talking about is, yes, we have transactional data, as we’ve talked about, we know exactly what people are doing, particularly like you across a whole portfolio.

PAULA: So maybe a whole lifestyle, but that again is behavior.

PAULA: But there’s social listening, I suppose, that can indicate emotion.

PAULA: Is that something that’s already in place for you guys?

ALEJANDRO: So social listening for us is very important.

ALEJANDRO: And we, as Puntos Colombia, we are starting to measure this.

ALEJANDRO: We want to track all comments coming from our members in the different channels that we have provided for them.

ALEJANDRO: So we are starting just with the basics, but we understand the importance of social listening, because this is part of what our customers wants to tell you, either positive or negative.

ALEJANDRO: But at the end, it’s a very powerful content that we should use it to improve the program in the coming years.

PAULA: It’s fascinating.

PAULA: And what kind of platforms can you listen to?

ALEJANDRO: Of course.

ALEJANDRO: Well, we have provided to the members different platforms and communication channels.

ALEJANDRO: We have a contact center, which is receiving a lot of calls every day.

ALEJANDRO: But also we have our web page, and also we have a chat.

ALEJANDRO: And we are starting to use WhatsApp also to receive comments on different topics related to the program and the member experience.

ALEJANDRO: So yeah, we are starting with those channels, and then we will expand and increase to use social media to know what the members are saying about their experience with the program.

PAULA: Wonderful.

PAULA: And WhatsApp is one that I’m very passionate about, particularly, I know there was some work done, for example, with WhatsApp in, I think, Brazil last year, where they were hoping to start doing payments.

PAULA: Again, nothing to do directly with loyalty.

PAULA: But do you have a completely open format so somebody can WhatsApp you anything at all, or is it structured data?

PAULA: How do you manage the capture and the listing on WhatsApp?

ALEJANDRO: Yeah, Pola, as we are starting with this new channel, last year, we implemented this functionality.

ALEJANDRO: We want to start with just basic functionalities using WhatsApp, for instance, if you want to know your balance in the program, then you can send us a WhatsApp and an automatic message will tell you what is your current balance in the program, and then you can decide how to use it if you decide to use those points.

ALEJANDRO: And also, if you lose your password ID to interact with the program, you can ask us using the WhatsApp.

ALEJANDRO: So as you see, we’re just starting with basic functionalities that we believe that this will improve the overall experience with the program.

ALEJANDRO: And once we measure the experience and again, the NPS of the customer or the member using this new channel, we will decide if we increase the functionalities coming from this.

ALEJANDRO: But I believe that all this new technology that is just ready to improve the overall member experience, we have to use it because at the end, and we mentioned at the beginning, a loyalty program, it’s all about experience.

ALEJANDRO: And if you are providing good experience, then you will have, and using technology, you will have a new way to communicate and to interact with the members.

ALEJANDRO: So yeah, WhatsApp, I would say that it would be very interesting for us for the coming months.

PAULA: Wow, I’m going to put that on my list to email you in like six months’ time and just go, please tell me how it’s going because it’s super fascinating.

ALEJANDRO: Sure, Pola.

PAULA: Yeah.

PAULA: And I know in other countries, for example, I think in North America, for example, Facebook Messenger is a dominant platform.

PAULA: And I’m sure there are loyalty programs doing what you’re doing.

PAULA: But for me, it just seems so obvious.

PAULA: And why aren’t more loyalty programs, you know, providing that particularly factual information?

PAULA: Like, you know, just tell me my points balance.

PAULA: I haven’t seen it on any loyalty program here that I’m a member of in the Middle East, but I think it’s genius.

PAULA: So I think, again, your customers are absolutely going to love you for that.

ALEJANDRO: Absolutely.

ALEJANDRO: As at the end, if a member has different alternatives to interact with the program, either it’s having a good experience or they want to put a comment because they didn’t have a good experience.

ALEJANDRO: At the end, you have to use all these platforms and technologies to listen to the member carefully and then transform these listenings into actions and then to correct if there’s something to correct, of course.

PAULA: Of course, of course.

PAULA: The other part that I really loved, again, just from kind of looking around at the work you’re doing, was a beautiful concept, which I’m guessing is a COVID solution, which you can correct me if this is something you were already planning.

PAULA: But I saw that you have some opportunities for members of Puntos Colombia to use their points to access, for example, a music concert, obviously online.

PAULA: And I saw a separate one where there was ingredients for cooking being sent to your members, and then you are running training and I think cooking classes.

PAULA: It sounds amazing.

ALEJANDRO: It’s amazing, Paula.

ALEJANDRO: It’s amazing.

ALEJANDRO: And we started last year because of the pandemic situation.

ALEJANDRO: We didn’t want to lose connection with our members and also with our allies.

ALEJANDRO: So we implemented different actions through the year to stay connected with members and allies having different kind of experiences, all of them, of course, through the streaming platforms.

ALEJANDRO: So we launched a music concert.

ALEJANDRO: As you know, Colombian music is very famous nowadays.

ALEJANDRO: So we hired some artists and connected them using streaming platforms.

ALEJANDRO: And we allowed members using a very low amount of points just to stay present in those concerts.

ALEJANDRO: And we also had different experiences for different members in the crowd.

ALEJANDRO: For instance, is a member in the top tier segmentation, then we invited this member not only for free, but also we provided them a couple of goodies related to the concert, being delivered to their homes to enjoy the concert with a full experience in that manner.

ALEJANDRO: And also we offered different cuisines lessons.

ALEJANDRO: We invited a Colombian chef who is actually living in Italy.

ALEJANDRO: So she provided a very interesting pasta lesson.

ALEJANDRO: And also we invited the members with a very low amount of points to be participating in this cuisine lesson.

ALEJANDRO: And it was very interesting.

ALEJANDRO: At the end, we measured the NPS on these members having these experiences and all of these opinions and comments.

ALEJANDRO: And of course, the NPS was a very interesting one because they wanted to stay connected with the program.

ALEJANDRO: And they didn’t know why, because the amount of allies were just closed because of the pandemic.

ALEJANDRO: So this is a way to stay connected, providing good experiences, providing value for the points in this time.

ALEJANDRO: And at the end, they were very satisfied.

ALEJANDRO: And also the allies, they were very satisfied, yes.

PAULA: Absolutely.

PAULA: So I can hear you take care of your partners as well as you take care of your members.

ALEJANDRO: This is a very interesting point, Paula, and let me tell you why, because at the end, Puntos Colombia is offering a very unique value proposal.

ALEJANDRO: First of all, as we were talking, we are offering a member program, a member value proposition around the Equality Program, because the member can interact with more, with 100 or more brands inside the program.

ALEJANDRO: So this is a, our B2C proposal just dedicated to the member.

ALEJANDRO: But also, Puntos Colombia is having a B2B proposal for all of our allies.

ALEJANDRO: This meaning that this proposal for business, we are providing them with strategic services.

ALEJANDRO: Let me tell you what kind of strategic services.

ALEJANDRO: First of all, Puntos Colombia is a marketing platform to connect our members with our allies.

ALEJANDRO: Using all this data and member knowledge, we can connect specific members with specific allies using all this data coming from.

ALEJANDRO: And also, Puntos Colombia is providing our allies with exactly data.

ALEJANDRO: We provide them insight analysis for them to take decisions based on these members’ behaviors and preferences.

ALEJANDRO: So yeah, for us, it’s very important, the B2C value proposal, but also the B2B value for our allies just to have them happy with the program and, of course, to stay with them on the coming years, yes.

PAULA: Incredible.

PAULA: And I don’t know much about the Colombian loyalty market.

PAULA: You’ll have to forgive me.

PAULA: Can you tell me, like, are there lots of other competing loyalty programs for consumers?

PAULA: Or would you say Puntos Colombia is the market leader?

PAULA: Or I’m getting the sense it is the market leader.

PAULA: Am I right?

ALEJANDRO: Yes, of course, Paula.

ALEJANDRO: Puntos Colombia just started in 2018, so we have two years and a half running as a national program.

ALEJANDRO: But at the end, yes, it is the leader of the coalition program in the market, because as a value proposal, we have the largest bank in the country, which is Ban Colombia, and also the largest and well-recognized retailer in the country, which is Grupo Éxito.

ALEJANDRO: They created this new company that calls Puntos Colombia, because they wanted to evolve and to increase their loyalty strategy.

ALEJANDRO: So they decided to create this new company, Puntos Colombia, and create this coalition program.

ALEJANDRO: So our member base is huge.

ALEJANDRO: I would say that it’s more than 8 million people enrolling to the program.

ALEJANDRO: And all these members that are coming from Ban Colombia and Grupo Exito, now they are interacting not also with the bank and with the retailer, but also with the press.

ALEJANDRO: And yeah, the Colombian loyalty market is very dynamic.

ALEJANDRO: We have good competitors, and I am thankful, thankfully because we have good competitors in the market.

PAULA: Oh, wow, great.

ALEJANDRO: Yeah, because if you don’t have competition, then you are not performing or developing actions to improve.

ALEJANDRO: So if you have competition, I would say that it’s a positive one.

ALEJANDRO: It’s welcome, right?

ALEJANDRO: So we have good competitors.

ALEJANDRO: The Colombian market is dynamic, is growing with new players, not only in the loyalty category, but also new players that are coming to the market with different proposals, but at the end, they are looking for loyalty.

ALEJANDRO: So I would say that also they are competitors.

ALEJANDRO: And in the region, Pola, the Latin American region, it’s also very dynamic and in development at a good pace.

ALEJANDRO: I would say that from Mexico to Brazil, they are interested in loyalty propositions with different value proposals.

ALEJANDRO: For instance, Brazil, which is the ninth economy, largest economy in the world, I can count at least three to four mature loyalty programs.

ALEJANDRO: Also the Chilean market has a good track in loyalty.

ALEJANDRO: Colombia, of course, as I mentioned, is a very dynamic and growing loyalty market.

ALEJANDRO: And the customers at the end, they are very interested, and they’re very often to understand what is the loyalty proposal.

ALEJANDRO: And because they understand that at the end, they will receive a benefit.

ALEJANDRO: So also the customers are eager to have these loyalty proposals, because at the end, they will see a saving, they will see a benefit, they would say a lot of good things happening.

ALEJANDRO: So also the customers are receptive and open to these strikes.

PAULA: It’s certainly a very exciting part of the world, Alejandro.

PAULA: I would love to understand the digital versus the physical side in terms of the identifier.

PAULA: So in my experience, most coalitions do still issue plastic cards.

PAULA: So I’m assuming you are as well.

PAULA: Is that true?

PAULA: Or are you totally digital or how is that part working?

ALEJANDRO: A very interesting question, Paula.

ALEJANDRO: Puntos Colombia is offering a unique proposal for the members.

ALEJANDRO: In other words, the program doesn’t need a card.

ALEJANDRO: The program doesn’t need a physical ID to have the member interacting with the program.

ALEJANDRO: In other words, the member is using their national ID number as an identification.

ALEJANDRO: So everyone has a national ID.

ALEJANDRO: And when you go, for instance, to the supermarket, the cashier will ask you your national ID.

ALEJANDRO: So that is the way that the member can earn or can redeem their points at the national ID.

ALEJANDRO: And you can earn your points at the physical point of sale.

ALEJANDRO: This is a unique Puntos, I would say, compared with other global loyalty proposals.

ALEJANDRO: Because you don’t need a plastic card.

ALEJANDRO: You just only need your ID number.

ALEJANDRO: And also, the ID number, you can use this number also in digital platforms.

ALEJANDRO: So it’s very easy.

ALEJANDRO: There is no user name or an email.

ALEJANDRO: It’s just a number.

ALEJANDRO: And that’s it for to interact with the problem.

ALEJANDRO: So it’s very easy.

ALEJANDRO: Good experience.

ALEJANDRO: It’s extraordinary.

PAULA: I’ve never heard of it, and certainly, I’m again fascinated with them, making the program as simple as possible, always for customers and for members.

PAULA: So that I think is one of the best I’ve heard.

PAULA: I know you also did work for MasterCard, for example, in the past, and also American Express.

PAULA: So I know there’s other mechanics around payment cards often used in other countries.

PAULA: But to be able to access the national ID and to use that for a tracker, I think that’s absolutely extraordinary.

ALEJANDRO: It is extraordinary, Paola.

ALEJANDRO: Very easy to use it with a good experience.

ALEJANDRO: And let me tell you on Statistic, there is a very good one also, and I can share it with you and with the audience, is that nearly 90% of total ticket transactions for tickets inside the retail is with an ID number.

ALEJANDRO: So we can track, we can know who is buying or purchasing exactly what kind of products, and also in the location, in time.

ALEJANDRO: So we can track a lot of information just because the member is using this national ID.

ALEJANDRO: So it’s a common practice in the market.

ALEJANDRO: It’s a common practice in the market.

ALEJANDRO: Everyone is using it.

ALEJANDRO: So the experience is a very good one.

PAULA: Well, I mean, the amount of infrastructure that must have gone in and the permissions management, because I know you do.

PAULA: Obviously, you already mentioned the respect, but to have that level of customer interest in, I suppose, the benefits of the simplicity.

PAULA: So I think they’re benefiting as well.

PAULA: And then obviously for the data, I’m not even sure how you managed it to pull all of that together, but certainly a beautiful experience.

PAULA: And I guess is it common in other countries as well?

PAULA: For example, you mentioned Brazil and Chile.

PAULA: Is it common in those countries also, would you say?

ALEJANDRO: Yes, I would say that the region is using this national ID to track not only the loyalty program, but also to track all the purchasing behaviors that the customers in those markets are having.

ALEJANDRO: So in Colombia, it’s a normal practice.

ALEJANDRO: And as I mentioned, yeah, it’s a very good experience.

ALEJANDRO: And you mentioned, Paula, may I?

ALEJANDRO: You mentioned two very important words for us, transparency and simplicity.

ALEJANDRO: Transparency because for us, the most important aspect is to have the member permission to collect all this data because we want to transform this data into benefits.

ALEJANDRO: So we ask for the member permission at the enrollment process.

ALEJANDRO: We ask for this permission to receive the member knowledge that we will use this data for good purposes.

ALEJANDRO: And also you mentioned simplicity.

ALEJANDRO: I would say that you are an expert on the loyalty industry and you may know a lot of different programs that maybe they are not as simple as they wanted to be.

ALEJANDRO: So in Puntos Colombia, in the beginning, when we just launched the program in 2018, we wanted to create a very simple interaction with the members, a very simple value proposal, and also very transparent communication to let them know what is terms and conditions.

ALEJANDRO: Very simple, because at the end, this also creates members’ trust.

ALEJANDRO: And if you have members’ trust, then you will have at the end loyalty at the long run or at the long period.

PAULA: Yeah.

PAULA: Well, that’s definitely something we share as well, Alejandro, because I did an entire show on the topic of simplicity, purely because there’s just some extraordinary insights that are coming through in terms of the correlation between the simplicity of a brand and the value of that corporation, which was again an extraordinary concept for me.

PAULA: But when you think about brands like Google or even brands like Apple at the other end of the technology scale, so could be too complicated, actually they’re very simple to engage with.

PAULA: So I think there’s huge value.

PAULA: And I think customers just feel, again, the respect coming through, that they’re super grateful that you’re, just show me the simple terms and conditions I need.

PAULA: Don’t make me jump through too many hoops.

PAULA: Let me use my national ID.

PAULA: I just think that comes through if that’s the intention of the program.

PAULA: And I think you’re absolutely right when you say so many brands have an intention for loyalty, but unfortunately fail.

PAULA: And I think it’s because of complexity or maybe the partners haven’t bought into the concept of the simplicity in the same way that yours obviously have.

ALEJANDRO: Absolutely, Paula.

ALEJANDRO: We want to create trust, member trust in the program.

ALEJANDRO: If we communicate in a transparent way, what are the terms, conditions, the rules of the program, then the member will create trust with us and then we will create loyalty at a long time.

ALEJANDRO: And let me tell you another good example on how we are being transparent with the members is about points expiration.

ALEJANDRO: You know, this is a very controversial topic when you are managing a program.

ALEJANDRO: Maybe some programs, they don’t want to communicate the expiration points policy because they want to create some breakage because at the end they will have a financial positive impact.

ALEJANDRO: In Puntos Colombia, we believe that if the member is using their points and redeeming these points to get any benefit or any service or product inside the program, they will be happy, as we mentioned, and they will create this long-run loyalty with the program and also with the program.

ALEJANDRO: So we do want to communicate points expiration.

ALEJANDRO: So every month, we in advance, the program in advance is communicating how much points will expire.

ALEJANDRO: And not only that, but also the program is giving some ideas and recommendations on how to use these points before the expiration date.

ALEJANDRO: Yeah, you are creating this emotional connection at the end, this trust relation.

ALEJANDRO: And also this is the thing that we believe that this is a benefit for the member and also benefit for the ally and at the end for the program.

PAULA: Absolutely.

PAULA: Yeah.

PAULA: And even I can feel that coming through because at the end of the day, sometimes my confusion comes from what can I do with these points?

PAULA: So it’s one thing to tell me that they’re expiring.

PAULA: I might already know that, or I might be upset that they’re expiring.

PAULA: But if you’re encouraging me then to say, here’s something that you can do that’s in my interests and that I benefit from, I just think that that again is the kind of thing that drives your NPS score.

ALEJANDRO: Absolutely.

ALEJANDRO: Absolutely.

ALEJANDRO: If you compare the NPS, if a member redeemed their points and you compare it with a member that couldn’t redeem their points because they had an expiration coming date and they couldn’t use it, then you will see the big difference on that metric.

ALEJANDRO: We believe that this is a positive thing for the program.

ALEJANDRO: Of course, we need breakage because every loyalty program needs breakage.

ALEJANDRO: But the breakage is coming from a different member segment and that will also benefit in the organization point of view, the program, the program at the end.

PAULA: Wonderful.

PAULA: I think my final question for you, Alejandro, was around certainly my recent birthday, which many of my regular listeners will know is a favorite topic of mine because, you know, this whole idea of capturing data and sometimes it’s never used.

PAULA: And I always feel that the simplest piece of data is somebody’s date of birth because at least you can say happy birthday.

PAULA: And because my birthday was actually yesterday from when we were recording, I was carefully noticing what all of the loyalty programs I’m a member of were doing for my birthday.

PAULA: So I’d love to hear in Puntos Colombia, is this something that you have a specific intention around or what you do with that data?

ALEJANDRO: Absolutely.

ALEJANDRO: Paula, yes, we are using the member journey to understand different kinds of information.

ALEJANDRO: And of course, birthday dates are very important for us, because as you mentioned, it’s very simple, but it’s very important to communicate and to let the member know that the program is taking care of his or her.

ALEJANDRO: And you are communicating this important day, just saying happy birthday to you, but also using the ecosystem value proposal, not just to communicate happy birthday, but also to offer this person different kind of benefits because of his or her birthday.

ALEJANDRO: And for instance, if you are having your 25th anniversary or 25th happy birthday, we will offer 25% discount in points for specific brands.

ALEJANDRO: And of course, there is a certain limit of date to use that promotion, but we believe that this kind of simple actions and simple things will create loyalty and of course happiness with the program and with the value proposal.

PAULA: Love it.

PAULA: And I like that relevance piece that you brought in there.

PAULA: If it is like a number that you can manage, like 25, and give something that’s 25% off, I think that’s lovely.

PAULA: And again, just makes the member feel like, oh, that’s super special just for me.

ALEJANDRO: Yes.

ALEJANDRO: Yes, we work with our allies to offer this kind of promotions.

ALEJANDRO: Sometimes the ally is paying for that promotion, and sometimes we as Puntos Colombia are willing to pay and invest because it’s an investment to invest this kind of promotion because at the end, this member will be engaging with the program and the different members inside the coalition.

PAULA: Absolutely.

PAULA: And I’ll give you two examples just because we’re on the topic, Alejandro.

PAULA: One I really liked was actually just a restaurant in Ireland, and it’s normally a lunch type restaurant.

PAULA: It’s called Leon.

PAULA: It’s actually a UK brand.

PAULA: But because I would maybe normally have gone for lunch, it gave me a free breakfast as my birthday treat, which I thought was actually a really nice way because there’s a value in me maybe tasting their breakfast, which I’ve never done before.

PAULA: And then that might be a new behavior that I might try.

PAULA: So I thought that was a brilliant example.

PAULA: And then also there’s a lovely one here in Dubai, a fairly new multi-partner program called Blue Rewards in the retail sector.

PAULA: And they sent me an opportunity to use a voucher for a nice little cupcake in one of the cafes in the big Dubai mall.

PAULA: So again, it’s the simple things.

PAULA: And I think that partner is more than happy to get me in.

PAULA: I’m sure I’ll end up buying more coffee and everything else.

PAULA: But those kind of things, I think your partners can really deliver for you in ways that again make the customer feel amazing.

ALEJANDRO: Feel amazing.

ALEJANDRO: And they are creating emotional connection with you.

ALEJANDRO: So this is the beauty and the power behind the loyalty strategy for the loyalty programs.

ALEJANDRO: You can create these emotional connections by doing these simple actions, but very impactful for the members.

PAULA: Totally.

ALEJANDRO: Brilliant.

PAULA: Yeah, for sure.

PAULA: So my final comment then for you, Alejandro, again is just to quote some lovely things you wrote on LinkedIn where you mentioned very clearly loyalty programs that only use transactions, be they even recent transactions or historical transactions.

PAULA: In fact, those programs belong in the past because they’re not developing the whole customer intimacy.

PAULA: And I think your point, you said, is that the whole point of the points programs is knowledge and recognition and thanking the customers.

PAULA: And I thought that was a lovely sentiment, and I just want to say well done to you.

ALEJANDRO: Thank you very much, Paula.

ALEJANDRO: Yes, I am a believer in that.

ALEJANDRO: And at the end, as Puntos Colombia, for instance, we’re using points, of course, because we need a transaction, and this transaction, in our case, is in points.

ALEJANDRO: But I believe that the long-run loyalty is emotional.

ALEJANDRO: It’s where the customers are transformed into brand advocates and brand ambassadors, as we mentioned in the beginning.

ALEJANDRO: But behind the emotional, there has to be a tangible benefit or tangible transaction.

ALEJANDRO: This creates clear expectations and rules to the members and clear rules and defined expectations, as we mentioned, create trust, member trust.

ALEJANDRO: So the program at the end can combine rational, such as points, and convert these rational transactions into emotional feelings.

ALEJANDRO: Just as your example, you had a free breakfast because you had some transactions with that specific restaurants.

ALEJANDRO: You had your data in that restaurant, and then they are recognizing your loyalty with a free breakfast.

ALEJANDRO: There is a transaction behind, and then they are converting this transaction into an emotional piece.

ALEJANDRO: So this is the magic of…

ALEJANDRO: So there is a…

ALEJANDRO: Of course, I know that there is an interesting debate between some people that are saying, no, points are old-fashioned, points are from the ancient times.

ALEJANDRO: And I’m agreeing with that, but you need a transaction.

ALEJANDRO: And if you can convert that transaction to emotion or a feeling, then you are doing a good job in your loyalty, right?

PAULA: I totally agree.

PAULA: And yes, the debate about whether points is a good thing or a bad thing, I can argue both ways, because I know there is a perception of, oh, another points program, and sometimes they have been disappointing and disappointing in the past.

PAULA: So I can understand sometimes consumers going, that’s not exciting.

PAULA: But to your point, actually, we need something that they understand.

PAULA: So the upside is, okay, great, it’s points.

PAULA: So now can I explain what the points are relevant for?

PAULA: So I think that debate will probably go on for many years to come.

PAULA: So I think that’s everything from my side, Alejandro.

PAULA: Is there anything else you wanted to mention before we wrap up?

ALEJANDRO: Paula, thank you very much for letting me have this conversation with you and with your audience.

ALEJANDRO: Yeah, no, I will end it up my comments saying that, as we mentioned, if you are a believer of a transparent simplicity and if you create distrust with a member, no matter if you are talking points, miles, or other different recognition, at the end, you will be able to do this emotional connection that creates great loyalty.

ALEJANDRO: Yeah, I am a believer in that.

ALEJANDRO: Puntos Colombia is working towards creating this emotional connection, not only with members, but also with allies, because this is important for us at the end.

PAULA: Wonderful.

PAULA: Well, I have to say it’s been extraordinary.

PAULA: I love all of the examples, the work you’re doing, including the pandemic stuff.

PAULA: I think it’s extraordinary.

PAULA: And even the focus on NPS as well.

PAULA: I think there’s a real clarity and a real vision there.

PAULA: So I have to say it’s been a fantastic conversation.

PAULA: I do hope we stay in touch.

PAULA: As I said, I want to be checking in on the results of these things now that you’re showing how innovative you are.

PAULA: So just want to say Alejandro Gonzalez Saul, Chief Executive Officer at Puntos Colombia, thank you so much from Let’s Talk Loyalty.

ALEJANDRO: Thank you very much for that.

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.

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