Paula: Welcome to Let’s Talk Loyalty, an industry podcast for loyalty marketing professionals. I’m your host Paula Thomas, and if you work in loyalty marketing, join me every week to learn the latest ideas from loyalty specialists around the world.
Hello and welcome to today’s episode of Let’s Talk Loyalty and Loyalty TV. Today’s episode is with KFC in the USA, the iconic quick service restaurant brand with a proud heritage of over 60 years of success and innovation. KFC is now the world’s most popular chicken restaurant chain and given the competitive market they operate in, we were particularly excited to hear about the launch of a new digital loyalty program for US diners in partnership with our friends in Marigold.
With a clear focus on digital transformation, their loyalty strategy leverages the power of gaming, fun and fandoms to drive the key commercial objectives that are brilliant both for diners and for the business.
Joining me for this episode is Paul Tuscano, Chief Digital Officer for KFC USA, and Roger Williams, Head of the Loyalty Centre of Excellence for Marigold. Together, they share the program that has already resulted in over three and a half million members joining this new loyalty program in 2024 alone. I hope you enjoy our conversation with KFC USA in partnership with Marigold.
So, Paul Tuscano and Roger Williams, welcome to Let’s Talk Loyalty and to Loyalty TV.
Paul Tuscano: Thank you. Happy to be here.
Roger: Thanks for having us.
Paula: Amazing. It’s always particularly exciting for us when an iconic brand like KFC is heavily investing in something so customer focused and so super fun. So I know we have an amazing story to share with our audience today.
Before we get into talking about either of your careers or about the program, of course we do have a very important opening question which always gives our audience a sense of what you admire as loyalty marketing professionals. So Paul, coming from a KFC perspective tell us over your career coming up to where you are now, what is currently your favorite loyalty program?
Paul Tuscano: Sure. And it really depends on what’s what’s relevant in my life today. And right now I would have to say Southwest Rapid Rewards their program is it. It’s so sophisticated in terms of how you can redeem points. There’s like for like cash value, which makes it extremely valuable. So it doesn’t limit you as far as what you can do with your points.
And then also their companion program. So I have companion status. So my family gets to fly for free with me whenever, you know, they can tag along if it’s not a business trip. So it’s a great value. to the overall program. And they’re, you know, such a great brand in itself, like very friendly, very welcoming. I love flying with them. So, yeah they’ve really earned my business.
Paula: Amazing. A great answer. And actually, we haven’t had Southwest mentioned as yet, if I can think back. So a shout out to Southwest, if anybody from there is listening, we’d love to have them on talking about the loyalty program, but beautifully articulated, Paul, because it is about that simplicity and making it relevant and valuable in your everyday life.
Paul: That’d be great.
Paula: So. Yeah, absolutely cool. So Roger, please tell us from your side, what is your current favorite loyalty program?
Roger Williams: I’m envious because that truly is a great choice, Paul really from an emotional loyalty perspective. But Paula, you really put me in a tough situation because at Marigold, to touch and power a lot of programs that people have heard off. So, it’s a little bit of a sticky wicket for me. So I’m going to give you the political answer and say that I have many favorites. Certainly programs that are really touching on that emotional sense and allowing customers to really get what they want. Like Paul says, I think are great. So if I really would have to pick a favorite unfortunately I’m gonna have to tell you, I have many favorites. So we’ll be here all day.
Paula: Okay. Good political answer. Nicely sidestepped and totally understand the position you’re in. Nobody wants to choose between their favorite children. So no problem at all.
So let’s get into your individual backgrounds Roger, given that we’re chatting right now. How did you get to this incredible road, Marigold?
Roger Williams: Wow, it’s been a long road, really. I started my career in nearly the late nineties as a loyalty program manager for an airline actually for Air Jamaica, now Caribbean Airlines running the loyalty program and alliances there.
And really that, that has influenced my entire career just in, in looking at loyalty programs, I tend to have a slant towards ancillary revenue. So, certainly creating an immense amount of value for customers and generating ancillary revenues and profits for companies. And that led me towards consulting for many years and launching industry conferences and helping loyalty managers and ancillary revenue managers to move forward in their careers at Airline Information.
We had several events, including the mega event. And that was a lot of fun for many years. And we certainly moved things forward in the airline loyalty space in 2021 not long after COVID after I left Sabre, airline technology industry giant there. And we did a lot of really cool loyalty things at Sabre.
I joined Marigold and and being at Marigold really has been interesting because you know, Here you have an old airline loyalty guy getting involved in retail and QSR loyalty programs, and it has been a lot of fun really just bringing some of the lessons from that vertical and learning with colleagues like, like Paul and so many of our other customers in the QSR space is absolutely exciting. So, I’m happy to be here.
Paula: Incredible. Well, we’re happy to have you. And absolutely. I know you guys do so much in the fun side of loyalty. And coming from an airline background is obviously incredible in terms of just that kind of industry training. Because obviously the airlines were the original. But the gamification side is something that I find so super exciting.
So Paul, tell us you’ve had an incredible career as well with some phenomenal brands. And so do you want to talk to us about your loyalty career?
Paul Tuscano: Yeah, sure. So I think the first time I actually touched onto loyalty, Verizon Wireless when Verizon started their first loyalty program, I believe it was called Verizon Plus or Verizon Smart. It was so long ago, I’m trying to remember, but I helped kind of stand that up with some of the activations with local marketing. So local promotions and rewards. But then after that was, mobile wallet. So we had an investment in a company like consortium investment with all the other carriers.
And we created a mobile wallet called soft card where you could load your loyalty cards into it. So when you went to pay with NFC or top to pay, you transfer your loyalty information at the same time as you paid. So and we had the full stack software. So with the payment terminal providers and the POS, you’re we were able to pull up your rewards information and you can transact with your points if you had points. So we did integrations with Toys R Us with their loyalty program. We did Coke Rewards, where you can tap and pay at the vending machine and pay with your rewards points. And that was back in like, 20, 2010, I think it was.
Paula: Wow.
Paul: So there was a, there were several brands that were a part of that loyalty onboarding their loyalty programs into our, into the wallet. And then since then we’ve sold that we refer to a smart tap to Google. So now it’s a part of the Google wallet ecosystem. Now not too many players have participated in anything. Apple is still looking at implementing or they have implemented it, but not too many people have onboarded. But that’s where I really got into technology for loyalty programs.
And then obviously Marriott Bonvoy. So I was responsible for Marriott Rewards. As well as Ritz Carlton Rewards app. And then when we acquired SPG, so we had all three, we had all three brands. And then ultimately merging that all together to become Marriott Bonvoy. So I ran that program since the, at least since the app inception for Marriott Bonvoy. And then prior to that what I would refer to as version 1.0, which was very, very basic. But yeah, ultimately ended up I would say it was one of my favorite projects and products that I got to work on being that I was a big Marriott fan before I joined Marriott itself.
Paula: Okay.
Paul: So yeah, that, so that, that was my history and that now I’m here at KFC and we launched the KFC rewards program.
Paula: You shared a wonderful anecdote as well, Paul, when you joined Marriott so I’d love if you’d share that with the audience because I know to me it was just really interesting what your experience was from being a loyal member already to, to working on the inside then on the program itself. So will you share that one with us?
Paul Tuscano: Yeah, I mean, when I started with Marriott, first of all, Marriott’s such a great brand as a consumer. People are so loyal to it as was I. As a rewards member for 15 years. Prior to that, I was gold status and joined joined Marriott. And what was interesting at the time, and nobody told me this when I joined, but they froze my account and I took, and when I found out I, like, I took it to heart. I was like, oh my goodness. You don’t mess with somebody’s programming points and status. So they froze my status. They froze my points.
Paula: Yeah.
Paul: And I ended up writing Arne Sorenson at the time, our CEO, right away. I was like, Hey, you can’t do this, right? Especially, and like I said the premise of being able to drink your own champagne, eat your dog, your own dog food you know, is the way you can deliver a better product for your consumers.
So he wrote back immediately and said, hey, don’t worry, Paul. We’re working on it. So sure enough they made the program available to everybody thereafter. But one of the things when people ask me like, wow, when they compliment the Marriott Bonvoy program or the app they say, how come it’s like, it’s such a great app. And I said, well, I built it for myself as a rewards member. I built it the way I wanted it. So that was that was a part of the whole process of joining Marriott and being on the inside, making the sausage.
Paula: Well, kudos to you for emailing the CEO on day one, Paul. I think that’s a lesson to all of us that when you believe in something so passionately, you should absolutely address it. And amazing that at the time they didn’t believe in staff having access, especially such a valuable account as you’d already you know, been a member of. So thank you for sharing that. That’s a brilliant story.
Paul Tuscano: No problem. And I don’t think it’s that they didn’t believe it. I think there’s economic things that they had to get through.
Paula: Sure.
Paul: But taxes and whatnot, but they figured it out.
Paula: They got it sorted. Brilliant. Brilliant. So KFC, very lucky to have you. I know you’re what, about a year in this role, if I’m not mistaken in this particular one?
Paul Tuscano: Exactly a year today.
Paula: Okay, well, happy anniversary.
Paul: Thank you.
Paula: And tell us, I mean, when you decided to go for that role, what was it that appeals to you about making the move?
Paul Tuscano: Was definitely the brand and obviously, you know, this is an opportunity to control the entire stack, right? So, front end development, user experience, now the rewards program. So having that complete control and defining it for an elite brand like KFC, that’s, you know, globally recognized was the main attraction.
Paula: I can imagine. Absolutely. And what stage was it at? Obviously, Paul, you’re going to tell us you know, everything that’s been going on. But when you came in a year ago today, what stage was KFC Rewards at that point?
Paul Tuscano: They had already started planning KFC Rewards for almost two years prior to me joining.
So as far as like the framework of what the rewards program was going to be, what the economics were that had already kind of been ironed out. And they were developing a lot of the back end, because it’s all based on Marigold’s technology plugging into our YUM Commerce ecosystem.
So YUM is our parent company. We’ve got a major investment in our digital and technology restaurant technologies. So that organization had built this whole ecosystem to be able to plug in multiple loyalty platforms. We were the first ones to be on that platform to launch it for YUM.
Paula: Wow.
Paul: So, so they had already done, they had done all that work prior to me getting there. And then we were in the, we were in the middle of the throes of development when I got there. And so I started there in August. So we launched in January. So we had roughly about six months of development to complete and launch. So yeah, so that’s kind of, that was the extent of it. And then when we launched, it was January 29th of this year. So we’re still very, very young.
Paula: Great. You’re still very, very young. And in a minute, I’ll come back to you to see how it’s going so far. But I wanted to ask Roger, from your perspective, were you involved from the inception of this opportunity with KFC back, I suppose, three years ago?
Roger Williams: I wasn’t involved in the very beginning. I certainly became involved along with the strategy team closer to launch, there was a lot of really hard work that went in by our respective technical teams to really bring us to this point. And I think we’ll be remiss not to recognize a lot of those folks and just the, I think Paul would agree that the cohesion of our teams, you know, I believe they even share Slack channels and go back and forth. And it’s almost a real time interaction. So, yes coming up and leading towards the launch, which was quite impressive. And I’m sure Paul’s gonna have quite a bit to say about that. And I won’t steal his thunder. We started getting involved and really creating this cohesive combination of not just a technology because now they’ve brought us to this point of technology nirvana.
But combining in what I like to see in our product is unifying that with strategy. So along with our very extensive strategy team the COE got involved and we’re certainly looking at a number of opportunities that we can drive the program forward.
Paula: Yeah, absolutely. And I know when we talked offline, there was certainly a very clear intention around the program. I guess it’s obviously first and foremost, a very competitive sector and clearly an iconic brand. And I think also very culturally significant as well. So, I guess there’s lots of different ways that you could have gone with the loyalty program.
So, would you mind explaining the proposition, Paul, in terms of what was launched just I guess, eight months ago, if you said it was January of this year. I know there’s been a huge amount of work going on, as Roger said, so tell us the customer proposition.
Paul Tuscano: Yeah, sure. So KFC reward members, once they sign up, they can earn 10 points for every dollar spent. And then after that they can redeem it right now. They’re currently being able to redeem it for food. But the way it’s set up is that it’s a certain different items are presented in there. And especially our LTOs, things that we, you know, we want to encourage folks the sample and try. So there’s a good selection of food available at different price point or tiers point tiers. And then we have a promotional targeted offers for our members. So highly targeted depending on what you enjoy and how often you come in, there’ll be promotions just for you. And those will end up in your, in the app for you. And then right now we’re in the process of launching challenges and badges.
Paula: Okay.
Roger: So this is the gamification element of what we’re doing. So now we’re gonna be able to reward you with these badges which are gonna be really fun to collect. They’re gonna be limited time availability as far as digital collection. And we’re still working through kind of what can those badges unlock for you? So whether it be at activations or in store there’s a opportunity to surprise and delight people who are dedicated and collecting these badges.
But to get these badges, you have to go through a series of challenges. Sometimes it might be a single action, right to earn the badge. In some cases, you know, you might have to try all our different sauces or different sandwiches to be able to earn a badge or you share, just share some information or fill out a survey. We’ll unlock some of these badges for you.
Paula: Perfect.
Roger: So that’s that’s essentially the intent of the program is just to keep engaging in a very fun way. So, and, you know, we have, I’m sure we’re going to talk more about it, but there’s definitely a lot more coming that we’re very excited about.
Paula: Oh, always. I can imagine. I know you’re just getting started. Give us a quick sense of what has been achieved just in terms of maybe key successes. Paul, again, it’s very young and eight months old at the time of recording. But I think you said to me last time we met, it felt like there was a big like pent up demand for KFC to do something.
Paul Tuscano: Oh yeah. There was, totally. So it’s interesting, it’s amazing how many people love the KFC brand. And just the, they were just waiting cause obviously they’re already very loyal. They love the chicken itself. And they come back all the time. And this pent up demand, we, you know, we’re setting our targets. We’re like, hey, how many, should we think we should be able to do in the first year? In the first month alone, we did a million customers.
Paula: Wow. That’s unbelievable.
Paul Tuscano: Which is amazing. I was just like, well, I was being new to the company. I didn’t have a sense of exactly what that demand was like and what that brand love and fandom was like. And it’s huge. So it was very exciting to see that.
Paula: Incredible. And you mentioned the personalization. So I thought I might ask Roger a little bit about that from your side. I think it’s something that anytime we talk to people on the show it’s definitely a journey in terms of really delivering what customers expect in this day and age. So what was the experience like delivering personalization for such a fun program?
Roger Williams: It’s really fun. The KFC team really gets it just in, in the way the app is laid out. I’m a user of the app. I actually, I always insist that we use our clients products. And we all love KFC and really just the simple part of seeing what’s next in the app that experience is extremely simple, but very effective.
So from a personalization perspective, there’s a lot of things that are coming together to kind of coalesce that it starts really with your loyalty journey. In an example, I just gave you there where it’s very clear where you’re going in that journey. And certainly the other part of it is a collection of moments.
So, the strategy team and KFC came to us with a couple of challenges and we have a methodology called a golden moments. That really sinks well with a series of moments and momentary marketing and life cycle marketing that the KFC team has already been prosecuting. Our golden moments really are built around that nirvana, that magical time after redemption where a lot of things happen. So the main objective really is to drive customers towards redemption. The more they spend is the more they’re going to earn. Of course, that earns going to represent additional revenue. So we were working really hard, both teams to kind of refine when those moments start after that redemption within the overall golden rule.
So there’s a lot of thinking and methodology that we’ve put into this to really, you know have that scientific evidence behind personalization that the other thing as well is that loyalty is inherently backwards, right? So when Paul was explaining things such as the challenges, we may ask you a question, a little bit of progressive profiling.
We don’t always just want to reward after a transaction. Without having some type of lead in journey or some type of lead in accrual. So, for example, giving points just for answering some questions, progressive profiling, having that lead in. And then now we have some more information about you that’s relevant. Not too much information. But just enough information to make that a personalized experience, right? So whether it’s like you, you like bone in options or boneless options and all those things, we’re also building habitual patterns because when you’re answering those questions, we’re going to give you some points, right?
And that’s going to lead up to like, wow, points are actually worth something. And when I redeem my points, there was something, and guess what, Paula, I want more of those points. So it’s this wonderful kind of golden moment cycle that, that we’re moving forward along with the team at KFC.
Paula: Beautiful. Yeah. Very well said, Roger. I was literally thinking about it as a virtuous circle. And the terminology of golden moment is really crystallizing it as well. I think it’s absolutely fabulous that thinking that’s gone in. And what I’m hearing and Paul, you can correct me if I’m wrong, but what I’m hearing is first of all a very clear understanding of the power of redemption. So burn drives earn, I guess is something that we would often talk about and that’s very up to date thinking. So it’s wonderful to hear that you guys are really happy for people to make sure that they get that redemption to drive their, I suppose, return visit to the restaurants.
Paul Tuscano: Yeah, and usually those redemptions are paired with additional purchases, right? So it’s never just the redemption itself. So again as you pointed out there’s an earning element as soon as they burn. So it just keeps compounding essentially.
Paula: Amazing. Yeah. Yeah. No, and it always does. I think that compound effect is something that certainly when I started in loyalty, I hadn’t realized how powerful it was. But I think when you combine that then, as you said, along with the gamification and I wanted to get a bit more understanding actually as well, Paul, because I know you described yourself last time we met as I think a collectible nerd. And I know that’s a core part now as well, in terms of digital collectibles within KFC Rewards.
So will you just talk about the fandom piece? And for me, it’s this idea of tapping into those kinds of passion points that you clearly understand that your customers love.
Paul Tuscano: Yeah, so I think I was very lucky you know, joining this brand because this is a pop culture brand. You know, the Colonel has been featured in Funko products, in DC comics, and Pokemon. So if you’re a collector of those and for the most part, that’s anyone under, I’d say under 45 has collected these things as a child or still collect. So, as far as like being able to resonate and connect with those fandoms this is very natural, at least for KFC. So I was very, very fortunate to, to join.
And those folks are so loyal and to, I mean, they love, they’re so passionate about those products and those collectibles and being able to unlock that for them through our brand. You know, my, my whole philosophy is if you love what they love, they’ll love you back. Right. Well, they’ll love you more.
And and this is natural for us, right? Like, I’m a fan, our CMO who started this came from Nintendo. So he’s into the gaming in the gaming space. I’m a comic book collector, sports memorabilia collector. So you’ll see some of that playing out. And when you think about all the partnerships that we’ve had over the, you know, the lifetime of the brand, right?
We were in, we’re in baseball. I’m sorry. We’re in basketball. We’re in football. Both college and professional. Currently we’re doing something with Deion Sanders, Zach Edey from who just recently got drafted. So, so there’s definitely huge opportunities that we’re looking at.
And one, one that we’ve, everybody’s already seen is the Funko collectibles. And Funco has just launched their Funko Fusion campaign. So there’s a new video game that’s coming out on September 13th, I believe it is. And I think this is going to air after that. So we’re actually going to be a part of the game. So as far as like gamification is concerned, we’re taking it to the next level for video gamers.
So the Colonel will be available in the game and then you are actually going to be able to, or you’re, you are going to be able to redeem your points for in game experiences. In this case, we’re going to have a souped up Colonel Sanders in two different variations. So, if you’re a KFC rewards member for free, you get the chef version of Colonel Sanders. And then for 250 points, you’ll get the mech armor Colonel Sanders, which comes with its own array of special weaponry. So it gives you some OP power, you know, overpowers you in the game.
Paula: Honestly, I mean, I can see Roger even smiling away there. Like, there’s just so much joyful energy around all of these different propositions that you guys are building.
And actually, Roger, I’d love to just get a sense from you. Again, you’re working in a loyalty center of excellence, and it’s not always the brands have that level of clarity that obviously that the KFC team have in terms of how the brand of the loyalty program can really kind of compliment each other. So would you kind of see a lot of that, or do you still think a lot of brands are on that journey? Like when you’re talking with them at the early stages of their thinking?
Roger Williams: This is pretty rare, Paula. Paul and the entire team at KFC are truly special. And I’m not just saying that to butter you up all, but really. It’s so refreshing to see that level of excitement and passion and a brand that is authentic. Paul mentioned an airline brand earlier that has that level of authenticity. And really that’s where you want to be as an organization where the brand has that level of emotional loyalty just on its own.
And then a programmatic loyalty program on top of that, with all the constructs that we would power is simply icing on the cake. And that’s going to move that, that, that revenue generation machine forward and then create that true incrementality. So yeah we see a lot of obviously, a lot of new programs and you know, they come in every day and one of the things that we try to advise on when we’re sitting there and someone saying, Hey, I need to start a loyalty program or I’m looking for loyalty technology. Is what are you solving for? We really come in and we actually don’t allow our sales people to to speak to prospects in the beginning. It’s us and our strategy team and we’re there for free and we just want to nerd out on loyalty. And in some cases it may not be a good fit in some cases, and don’t tell sales. This we’re just like you’re not ready for a loyalty program. Right. Paul and the team were at that time where they were more than ready for a loyalty program. They were really chomping at the bit. And as you saw, there was a lot of pent up demand with a million members in the first month. So that’s pretty rare. But we certainly want to make sure those things are aligned when you’re looking to start loyalty.
Paula: Totally.
Paul Tuscano: I forgot to mention our partnership with BoxLunch. So we do all kinds of licensing deals and BoxLunch which is a Child brand of Hot Topics, I believe.
They did, we did a partnership with them and they did a whole line of accessories and clothing for KFC and KFC reward members get 25 percent off that line. So all you got to do is show up in the store, show them your rewards membership or get the discount code. And so BoxLunch is also a very big pop culture brand.
So we’ve partnered, we had partnered with them over the summer on, we’ve launched national fried national, was it National Fried Chicken day, which was on July 6th, I believe.
Paula: If in doubt launch a day with your favorite food. I love it. That’s amazing.
Paul Tuscano: Yep.
Paula: Brilliant. Brilliant. The other piece I always think about brands like yours, Paul, is I suppose the operational and ownership structure brings, I think, massive discipline is probably the word I’m going to use.
Because it’s a franchisee led business, you really have to, I suppose, bring the whole organization, every single franchise owner, along the journey of what you’re building. You know, what I suppose the funding model is and the returns that they can expect coming out the other side. So I’d love if you would just kind of comment on how you find it now. I guess it’s quite a different business structure again to what you’ve worked with in the past. But working with franchisees, I think is incredibly exciting for a band like yours.
Paul Tuscano: Oh, yeah. So, so we have a great set of franchisees. They’re very invested in digital technology. You know, they recognize that we’re behind.
You know, the digital experience only started during the pandemic, really. So, so we’re definitely behind, but they recognize how important it is. And they pushed the brand to come up with this program. And they’re very invested. So, you know, the idea that you can redeem points and for food in their stores which is at their cost to be able to participate in that and get get buy in.
So very active. We meet with them quarterly. Actually, we just had our meetings yesterday. So we go over product road map. We discuss kind of issues and see how we’re going to try to solve it together as a company. They’re very, very active. Yeah great set of people to work with.
Paula: Amazing. Amazing. And I guess the other piece as well, which again is super exciting. And I think part of what you said at the very beginning appealed to Paul, the whole, I suppose, opportunity of a market, the size of the US which is obviously what we’re talking about today, but then there’s a whole global business out there.
So I guess you can tap into not just the Marigold expertise, but also KFC colleagues all over the world in terms of what they’ve done to drive loyalty and I guess, frequency into the restaurants.
Paul Tuscano: That’s right. So we do have so KFC Global runs the brand around the world. We’re responsible for KFC US and we’re responsible towards our franchisees who pay into the program.
So, every country or subset of countries has their own franchisee model and how they fund the program. So in our case, France already had a program. UK has a program other brand, other KFC brands are looking at getting on board and they’re looking at us as the poster child of how, what a program should look like and looking at the technology stack that Marigold brings.
So there’s definitely you’re going to see growth of KFC rewards programs around the country, or sorry, around the world, I should say, but definitely in the country as well. But as far as like unifying the program, that’s probably not going to be possible because of the franchisee structures that are there.
Paula: Of course.
Paul: So we’re very beholden to those franchisees that are there and each have their own economic models which kind of dictates what the programs look like.
Paula: Yeah, and I do think it needs plenty of flexibility as well, just from us talking with other brands on the show, obviously there’s different market conditions that, that each of your operating countries need to reflect, I guess, different sets of competitors maybe different appetites for things like gamification, as you said, and that whole culture piece looks very different, of course, in different markets around the world. So, so the job will never be done. And I guess that’s half the fun of of marketing is that we get to customize things locally and at the same time have something extraordinary for a market like the US. I mean, it’s an incredible opportunity that you’re working on at the moment. Yeah.
Paul Tuscano: It is, and we’re starting to collaborate more globally as well. So we just came off of meetings with my peer CD, CDTO group just to talk about the market conditions, opportunities, where we can collaborate more and looking at, you know, different technologies that we can leverage.
Paula: Amazing. And Roger, again, I suppose coming back to you with the, I think even the most fun job because you’re involved at the very beginning and a huge amount has been achieved, of course, already, and I know there’s a lot more to come. What are you thinking about now as you’re, I suppose, advising the KFC team in terms of what’s next, because there is always the next step, the next phase. So what are you thinking about?
Roger Williams: Yeah we have a lot of things in mind as we’ve been getting some of these really interesting insights. One of the things that I found really interesting that Paul shared with me early on was this really the trajectory for how people consume KFC, right? There, there’s a clear delineation and perspective in terms of just their core product, right?
So, chicken on the bone versus kind of boneless options. And it’s really interesting to see how those bonus options have aligned with frequency and repeat business. And it’s become really core to the program, right? Paul, I believe like nuggets are one of the favorite redemption items for them.
Paul Tuscano: Yeah. And we intentionally structured it. Let’s make so make it so that nuggets were extremely accessible. It’s a new product that launched last year. And, you know, I think it’s actually one of the definitely one of the best nuggets that are out there. And now our saucy variants are amazing. They have taken off with you know, broad variety of segments you know, the youth really love it.
And when I say the youth, I’m talking about my kid who’s 16 and his friends who have expressions that I don’t understand, like saying it slaps. I have no clue what that means.
Paula: I’ve never even heard that Paul, do we know what it means yet? Or are we still hoping to figure that out?
Paul Tuscano: Apparently it means it’s amazing.
Paula: Yeah. Yeah. I mean, major, maybe Roger’s cooler than I am. Roger, did you know that term already?
Roger Williams: First time, but I inferred it. It is amazing. And really, it’s amazing for the business because we’re seeing this trajectory of the frequency aligned with those boneless options. And you know, Paul, when you first shared that with me, I thought it was interesting. And we’ve been looking at that data. And it definitely shows. So there’s so many things now that you know, that we’re thinking about we’re trying to support our colleagues at KFC. And certainly looking at that proper life cycle marketing and bringing that, bringing the loyalty elements into that, those habitual patterns, right?
Paula: Yeah.
Roger: So whether it’s driving more frequency. Into locations and for franchisees and also just aligning with the product evolution if it’s going to be boneless, but also there’s still bone in because that’s a favorite, but then, you know, your behavior might be different around, say, a bucket of chicken and bone and chicken. Maybe that’s more of a special occasion type of thing.
So, we want to be able to kind of examine all of this from a loyalty perspective, because as you know, it’s just a plethora of zero party data and also kind of directional data and insights. So we’re really excited. There’s actually a lot more insight than we can manage it at the moment, but that’s a good problem to have, right?
Paul Tuscano: Now we’re really excited about the data that we’re going to, we’re in the process of collecting, right? So getting to know our customers and especially what really resonates with customers in terms of the different products. Right now, we know what people are buying, right? But to really say like, hey, you know. You know, these 25 year olds are, you know, honing in on the boneless products and then which sauces are they really leaning towards? Are they the savory kind or the sweet kind? The hot spicy kind, right? So that really helps dictate kind of the product mix that we’re going to be pursuing.
And then also even providing like exclusive sauce access to members and that kind of stuff to see really hit what hits ahead of time before we make it like mass availability. So, yeah, just the data insight that’s possible with this is amazing.
Paula: Yeah. You know, I never knew there was such a thing as exclusive source access. That’s super cool. I love it.
Roger: We made it first.
Paul Tuscano: Well, when we launched our saucy sandwiches, it was available digitally only first for like a couple of weeks or maybe a week ahead. So, and those are going pretty well as well.
Paula: Amazing. But what I’m definitely hearing, Paul is not just the fun factor and genuinely it’s amusing but it’s a very clear alignment in terms of obviously what the business needs because you already told us earlier, for example, about the sampling that you’re doing and using the loyalty program to get people to sample a different product because I’m terrible, for example, that I tend to have the same thing anytime I go to a restaurant and my husband goes crazy. He’s like, it’s got to a new restaurant. Let’s try something new. So I love when a loyalty program is actually use it used as a lever to drive something that the business actually needs. Because obviously nobody’s going to buy the sauce or the beautiful new chicken nuggets, unless they’ve had an opportunity to sample them. So, so to use it so strategically, I also think is quite rare.
Paul Tuscano: No, it just made sense. I mean, you lower the barrier to try, right? If they’re there, because just like you, there’s people who like, they know they want their two piece chicken with mashed potatoes and gravy and they’re reluctant to try anything else.
So if you make it very easy to, to access the nuggets or new OR strips that are coming out like that’s, you know, that we’ve been testing in other markets. This is the way to do it.
Paula: Amazing.
Paul: Specially amongst your loyal base. Right. Cause we, the, our loyal customers come in like every month, right. And the, and specifically the reward members are 20 percent more active. So getting them to try new things and having a pulse on like what really hits for them is more than likely going to hit for the rest of the population, but like they’re a great leading indicator.
Paula: Amazing. Yeah. So sounds like from both sides, I guess, Paul, you first in terms of what’s what’s coming for the future. You’ve talked about fun, you’ve talked about fandom, you’ve talked about that, I suppose, strategic alignment in terms of, you know, trying new products and all of that kind of stuff. Anything else you can kind of tease our audience with that you’re thinking about as we come, I guess, to the end of maybe 2024 and, you know, lots of opportunities still ahead?
Paul Tuscano: I would say stay close to the program, collect those badges and we’ll see what they unlock in the future, but it’s definitely going to be a fun program.
Paula: Okay. You did tell me before that you’re literally releasing new updates every month, actually. So it’s very active, I guess. Yeah.
Paul Tuscano: Oh yeah. Yeah. We have I mean, like I said, we were pretty nascent in our digital experience, so there’s a lot to do in order to really serve our customers and our loyal members.
Paula: Yeah.
Paul: And we have huge aspirations. I think this will hands down be one of the best programs.
Paula: Incredible. Well, no shortage of ambition there, Roger, from your side. What are you most excited about as we come towards the end of this year and into next year?
Roger Williams: I really just think that what the team has been doing is a masterclass in digital merchandising for the QSR space.
And I know we’ve been saying digital for this entire session and Paul has digital in his title, but it really shouldn’t be underestimated where KFC has brick and mortar stores, right? Where people go in there. But this program really has been successful around digital being the main interface for customers to experience the brand. And get a number of benefits convenience. So they’re ordering through the app. They’re getting the rewards are coming in and picking up. It’s super convenient and that’s going to drive really important KPIs like frequency and repeat business when people can get good quality food in a very convenient and accessible way and digital is the panacea for that. So we’re really excited and continuing that digital journey with Paul and team whether it’s through the amplified gamification and the colonel going absolutely ballistic in his full armor. Or just having people try new things like, you know, slapping sauces.
And we do have a few mechanics up our sleeve that We have prepared for some of, I know, Paul’s really great ideas because when Paul comes with these ideas he’d run with it because it’s going to be magic, right?
So we, I don’t want to give it away too much, but you know, and some of that, the same kind of mechanics in terms of if you think about, well, well, what will some people try, right? You know, how can we get more incrementality from just your high value members? And we have a couple of things there where people will kind of wear, be in different modes or temporal modes, whether it’s on a weekend persona or midweek persona. Or if you’re in your local area or you’re on a road trip, right? So there’s certainly some ideas that I know we’re working on there and we have the mechanics to be able to make that fun and and profitable for the KFC brand.
Paula: Yeah, and there’s a couple of things you’ve said, Roger, from your side that I’m reflecting on.
One is the fact that you’ve got all this kind of wonderful amount of data, which again, early days in terms of like extracting all of those insights, but the fact that you’re capturing those I guess it sounds like for the first time means you’re going to be super well informed, of course, in terms of all of those fun mechanics.
So you can do the fun brainstorming and be sure that they’re actually going to work. So, so I think that’s really clear. And again, I know we’ve talked with you guys before about that, most brands are just still like desperate for insights and in order to live with the personalization that I know you guys are working so hard on. So amazing to hear that’s such a strong work in progress.
And the other term that I really like to use Roger from your side was what are you solving for? Because I think that’s something as loyalty programs. You know, it’s important to keep that kind of vision you know, no matter what stage the program’s at. Sometimes at launch, it’s super exciting, but maybe a few years in, people sometimes lose sight of that. So that sounds like something that you and your team keep front and center all of the time.
Roger Williams: Absolutely.
Paula: Amazing. So Paul, I’ll come to you for any final thoughts, closing words of wisdom. Is there anything else about KSC Rewards that I haven’t asked you about that you think our audience should should know?
Paul Tuscano: I think, you know, they should download the app, try it out, become a member and and see how it goes. But yeah, I mean, again, stay close.
Paula: Amazing. Wonderful. Well, listen, with that said, Paul Toscano, Chief Digital Officer from KFC US and Roger Williams from Marigold. Thank you so much from Let’s Talk Loyalty and Loyalty TV.
Paul Tuscano: Thank you.
Paula: This show is sponsored by Wise Marketer Group, publisher of The Wise Marketer, the premier digital customer loyalty marketing resource for industry relevant news, insights and research. Wise Marketer Group also offers loyalty education and training globally through its Loyalty Academy which has certified nearly 900 marketers and executives in 49 countries as certified loyalty marketing professionals.
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