Visa’s Andy Chalcroft: Co-Brands, Loyalty Programs, and Engaging the Next Generation (#699)

Andy: Co-brand, in a sense of loyalty, is the fuel on the fire of a loyalty program.

Andy: In the US, seven of the top ten co-brands are on the Visa network.

Charlie: What do you mean when you talk about co-brand?

Andy: First of all, you’ve got the bank who issues the card.

Andy: You’ve then got the brand, the business associated with the product.

Andy: And then thirdly, you have the payment network.

Andy: 50 plus percent of all the points coming in to a loyalty program are attributable to the co-brand itself.

Andy: Super interesting during COVID and we looked at the airlines in the US, the only way that customers were earning and engaging into your program was through the co-brand.

Charlie: What does that look like?

Charlie: What do you look after?

Charlie: And how do you balance that sort of market lead with the global kind of support that you do as well?

Andy: We have hundreds and hundreds of products that we build, most of them API enabled, so our partners can tap into them quickly.

Andy: Instant issuance actually allows us to be able to provision a working co-brand into a customer’s mobile device.

Andy: So that application process, instead of waiting 10 days for that card to appear in the post, you get it instantly.

Charlie: The ability to do things instantly must really stand out.

Charlie: Are there any other sort of one or two things that you think brands should be doing there to kind of really relevant and be relevant and stand out in this space at the moment?

Andy: If every program looks and feels the same, then customers are going to start to disengage.

Andy: Over 70% of customers now fully expect personalized interactions.

Andy: We can’t get to a customer in near real time for that need.

Andy: Then we’ve probably lost the opportunity.

Andy: Almost all of our partners look to extend the partnership with Visa, which for me is a testament to the great work that the organization does with partners.

Paula: Hello and welcome to Let’s Talk Loyalty and Loyalty TV, a show for loyalty marketing professionals.

Paula: I’m Paula Thomas, the founder and CEO of Let’s Talk Loyalty and Loyalty TV, where we feature insightful conversations with loyalty professionals from the world’s leading brands.

Paula: Today’s episode is hosted by Charlie Hills, Chief Strategy Officer of MandoConnect, a UK based agency that uses smart data to create brilliant partnerships and rewards that really work.

Paula: Enjoy.

Charlie: Hello and welcome to this episode of Let’s Talk Loyalty.

Charlie: As Paula mentioned, I’m Charlie Hills, the Chief Strategy Officer for MandoConnect.

Charlie: In this episode, I’m delighted to interview Andy Chalcroft, the Vice President, Head of North American Co-brand and Global Center of Excellence for Visa.

Charlie: Andy leads the co-brand program development across the US and Canada and also supports globally.

Charlie: He helps in-market regional and global teams develop world leading co-brands and partnerships for Visa clients, focusing on every aspect from new business development to existing portfolio enhancement.

Charlie: Andy brings a deep experience of co-brand, cards, loyalty and banking, having led the Visa Co-brand Partnership development function in the Asia Pacific region before relocating to North America.

Charlie: Today, we’re going to be all learning about his favorite books, his favorite loyalty programs, highlights and key learnings from the programs and co-brands he’s worked on, and of course, all about co-brand and the world of Visa.

Charlie: I hope you really enjoy our conversation today.

Charlie: Hi, Andy.

Charlie: Welcome to Let’s Talk Loyalty.

Charlie: We’re delighted to have you on the show today.

Andy: Hey, Charlie.

Andy: Great to be here and thank you so much for having me.

Andy: Very excited for the conversation.

Charlie: It should be a really good one, I think.

Charlie: And hopefully, it’s a fairly going to be fairly new topic for lots of our listeners.

Charlie: And with a brand like Visa, I’m sure we’ve got hundreds of people kind of tuned in to find out all about it.

Charlie: But before we get into the detail of your brilliant day job and everything that you do, I wanted to open up with the same sort of question that we ask all our guests now actually, which is to tell us about one of your favorite books, Life, Leadership, Loyalty, Business.

Charlie: We’ve had everything from poetry right the way through to kind of loyalty textbooks.

Charlie: So what’s your favorite and why?

Andy: Great question to start with and a difficult one to answer because there’s so many great books on Life, Leadership, Loyalty.

Andy: I guess for me, there’s one book that truly stands out.

Andy: And the reason it stands out for me, I guess, is twofold.

Andy: One, just the lessons that I’ve learned from it that have held true for me throughout my professional career, but also this book influenced like my life and the direction that I’ve gone down.

Andy: And so the book that I’m going to highlight is A Brief History of Time by Stephen Hawking.

Andy: So Stephen Hawking is an amazing British physicist.

Andy: And for those of us that, you know, haven’t necessarily heard or read this book and probably aren’t honestly quite as geeky as I am, A Brief History of Time goes to explain some of the most complex yet fundamental topics that we have as humans.

Andy: You know, it goes to talk about the origins of the universe all the way through to how the universe is eventually going to end and then everything to do with space and time in between that.

Andy: And, you know, for me, I first read this book when I was a young, young teenager and it kind of sparked, like, my imagination and ultimately led me down, while I was in education, down a path of physics and astrophysics.

Andy: And that was my degree.

Andy: And it was this book that kind of sparked me in that direction.

Andy: And then not only did it take me down that educational route, but in my professional career, I think the thing that this book does so well is it takes what is honestly the most complex topics that you could discuss and breaks it down and be able to explain them in such an easy and relatable manner that anybody without a background like I didn’t have, like being a young teenager in this area can understand.

Andy: And for me, I think that’s just such an underrepresented and undervalued skill in the business environment is we all work in highly specialized areas and being able to simplify that and explain it to an audience that don’t necessarily have the background that we all do, I think is just amazing.

Andy: I don’t see it enough in my professional career.

Charlie: That is an awesome, awesome recommendation.

Charlie: And I also read that book, probably about the same time, actually.

Charlie: And I loved it.

Charlie: And I’m really looking forward to it now, because I’ve got two boys who were early teens, and I’ve introduced them to the idea of it.

Charlie: So we’ve watched the movie, The Theory of Everything.

Charlie: And now, obviously, we’ve watched Big Bang Theory as a family, which everybody loves.

Charlie: And of course, Stephen Hawking is such a huge character in that.

Charlie: So, yeah, I might try, actually.

Charlie: You’ve reminded me.

Charlie: I must try and get my 14 year old to read it.

Charlie: My 13 year old, I could just about get to pick up a comic.

Charlie: So I think I’ve got to be realistic in my expectations there.

Charlie: But yeah, it is.

Charlie: That’s an amazing book.

Charlie: And lovely that it’s got that personal and professional angle as well.

Charlie: So many people have actually come on and answered that same question in the same way.

Charlie: And that’s lovely because I think when I first started asking the question, I thought they’d be more like, you know, the professional sort of loyalty books.

Charlie: But it’s been great to get that kind of breadth.

Charlie: We’re building like a really cool kind of book club recommendation.

Charlie: So that’s a great start.

Charlie: And it also leads really nicely to my second question, which is, how the hell did you go from being an astrophysicist to working up in loyalty and ending up in this field?

Charlie: I mean, tell us a little bit about your background and how you got from there to here.

Charlie: That must be quite a journey.

Andy: Sure, sure.

Andy: Before I get into that, if your boys need any help in that background, I’m here.

Andy: You’ve got my details.

Andy: Thank you.

Andy: Excellent.

Andy: They will love that.

Andy: But yeah, it’s been an interesting journey and an amazing ride for me.

Andy: Having come from a science background, I grew up professionally in banking in the UK.

Andy: You can probably tell by my accent, some of yours Charlie kind of grew up in the UK.

Andy: Doing a whole host of roles from finance to marketing, to product design and product execution.

Andy: And I was lucky enough to do a lot of those roles in the banking world in various different markets around the world as well.

Andy: So everywhere from Australia, Singapore to the US and many, many markets in between as well.

Andy: But there was a common thread that really energized me no matter the role and the direction I was taking my career in.

Andy: And that’s the analytics side of the finance world.

Andy: And working in the banking environment, looking for that data-rich environment, honestly, the area that goes deepest into that is the cards and payments world.

Andy: What excites me is not only analyzing data, but using it to predict future behavior, and then build campaigns, whatever it may be, off that to kind of capture that engagement.

Andy: And so moving into the cards and payments world, eventually ended up running end-to-end cards businesses, the various banks around the world.

Andy: And whenever you move into the card space, cards and loyalty are just so entwined together.

Andy: You know, like they’re handing the love.

Andy: You can’t have one without the other.

Andy: And so running large cards programs kind of gave me a front row seat into how powerful loyalty can be.

Andy: And it’s not just for driving spend on the product, driving acquisition, it’s how to shape those long-term customer relationships.

Andy: And so, yeah, that pulled me in to the world of kind of loyalty cards and payments.

Andy: And yeah, honestly, been hooked ever since.

Andy: I think it’s just such a fascinating and dynamic world that we all work in.

Charlie: That’s really cool.

Charlie: I wonder if you can explain it as simply as Stephen Hawking does as well.

Charlie: You know, big kind of complex data sets distilled into like really kind of compelling stories.

Charlie: That’s a challenge for you for the rest of the podcast.

Charlie: What about your current role now?

Charlie: Because obviously you’ve got quite a big job at the moment.

Charlie: What does that look like?

Charlie: What do you look after?

Charlie: And how do you balance that sort of market lead with the global kind of support that you do as well?

Andy: Yeah, no, no, for sure.

Andy: So yeah, at the moment, I’m very lucky in the fact that I lead our co-brand business for Visa in North America and our global Center of Excellence for co-brand.

Andy: And so, you know, it’s cool.

Andy: My role is all about building strategic partnerships that drive long-term value, not only for our partners, but for our partners’ customers, you know, through helping think through how do we build new compelling programs to bring to market, all the way through to optimizing the performance of our existing programs and partnerships.

Andy: And, you know, I’ve been working in the Cards and Loyalty space for quite a while now, and it really started when I was running Cards programs.

Andy: That’s where I saw how closely, yeah, Cards payments is linked with loyalty.

Andy: And, you know, again, as we were talking about before, to be successful in this space, you need to have a deep understanding of the customers and, you know, what they’re looking for.

Andy: How can we drive engagement?

Andy: How can we drive that brand connection?

Andy: And, you know, through my career at Visa, I’ve been lucky enough to work with some incredible companies, incredible brands across every industry segment, in every market around the world, thinking how to, yeah, evolve their loyalty strategies, unlock their loyalty strategies.

Andy: And, you know, like I said, like bring to market new co-brand programs that are going to help drive the loyalty strategy.

Charlie: I mean, it seems crazy to ask you, because you work for Visa, one of the world’s biggest brands, but what have been some of your biggest achievements?

Charlie: You’re going to name drop now, I know you are, like, oh, yeah, we did this with this mega brand and this with this mega brand, and go for it.

Charlie: You’re a shame free environment.

Charlie: We want to hear about it.

Charlie: The biggest achievements that you’ve done.

Charlie: It’s a moment, show off, shine.

Andy: Can you let me have three?

Charlie: I can let you have three.

Charlie: Yeah.

Andy: Okay.

Charlie: Fair enough.

Andy: Thank you.

Andy: Thank you.

Andy: I appreciate that.

Andy: So I guess, first of all, having worked for a number of large companies, now currently working for Visa and worked at many different markets, that’s meant that I’ve come across some amazingly talented people that I’ve either worked with or had the pleasure of leading as well in some instances.

Andy: And I’d say one of the biggest achievements for me is honestly seeing where those people have gone and how they’ve developed their career.

Andy: Just being able to help people get to where they want to get to has been amazing.

Andy: And some of those people have had the pleasure of working with and now running large card or loyalty programs in different parts of the world.

Andy: And so, yeah, I would say that the first thing is just we work in such a great people industry and seeing how people grow and evolve has been amazing.

Andy: And being able to play even a small part in that journey is absolutely phenomenal.

Andy: So maybe not quite name dropping like you were looking for, but certainly something that-

Charlie: That’s lovely.

Charlie: That’s a great number one.

Charlie: What’s number two?

Andy: Okay.

Charlie: Yeah.

Andy: Number two, I think it comes back to the previous question when you’re asking about my role at Visa.

Andy: So I’ve worked at Visa for seven years.

Andy: And as I mentioned, a large part of my role is helping partners think through how to bring the best product for their customers to market.

Andy: And just seeing how those products have hit the market, come live and they’re growing at accelerated rates is just an amazing sense of achievement.

Andy: When you see, maybe I’ll give you a better example, actually, when you’re out for dinner with a group of friends and you’re splitting the bill at the end of dinner and someone pulls out the co-branding card to pay that I had a role in helping bring to market, that for me is amazing and gives me a huge sense of achievement when sat around that dinner table.

Andy: So yeah, helping a whole host of partners around the world from a Visa perspective launch products.

Andy: So that was, I should say, number two.

Andy: And number three, I promise I will give you a specific example because I know you told me to name drop a little bit as well.

Andy: So yeah, the third one, earlier on in my career, I was working for a bank in Australia, so National Australia Bank.

Andy: At the time, NAB, as it’s known as, didn’t have a loyalty program.

Andy: They’re the only major bank that didn’t have their own rewards or loyalty program.

Andy: And so I was lucky enough with an amazing team to go into the project, to build strategy, and then ultimately bring to market the rewards program.

Andy: It’s so frequent in the, oh, sorry, so unfrequent in the loyalty space, you get the opportunity in a matured business to build a brand new program.

Andy: It just doesn’t happen that often.

Andy: Most of us are all looking at how can we optimize our existing programs or build off that program.

Andy: And so having that chance was amazing.

Andy: And equally, we also had the opportunity to look at the market and understand what all the other loyalty programs were doing in the market and how can we take that thought for the bank at the time.

Andy: And something we were very proud of is all the other bank loyalty programs were mainly centered around the credit card business, to be honest.

Andy: What we did was take a full enterprise view and see how we could leverage it for all of our customers interacting with the bank.

Andy: And so, yeah, just an amazing experience to go from the design, the strategy, the build, and then the implementation, and then the ongoing kind of optimization of the program.

Andy: Just such a phenomenal part of my career.

Charlie: I think it’s going to lead very nicely onto my next question as well, because the privilege of being agency side is we get to build a lot of programs at Mando, and we get to go on that journey.

Charlie: So we’re very aware of the highs, which is very cool, but we are also very aware of the big challenges that face.

Charlie: And I wonder if that might be linked to your answer to my next question, which is what are some of the biggest challenges you faced in your career?

Charlie: And kind of how have you overcome those?

Andy: Yeah, no.

Andy: Yeah, super interesting question.

Andy: I guess I would say that the biggest challenge is one that I actually face every day.

Andy: And I’ll face it today.

Andy: And that’s just trying to keep pace with everything that’s happening in our area.

Andy: You know, thinking ahead of what is a hugely changing environment with loyalty and cards and payments.

Andy: You know, every day, there’s a new piece of technology like change in our area, or there’s a new entrant into the market, you know, via a new issuer or a new brand trying to move into the loyalty space.

Andy: And so competition is is this.

Andy: And so, you know, thinking how to stay ahead and, you know, be able to bring relevance to our partners is is a constant challenge.

Andy: You know, couple that with the rapid kind of shifting consumer expectations that we’re all experiencing, it makes it even more of a challenge, isn’t it?

Andy: You know, it’s something that I love and constantly push myself to stay ahead of.

Andy: And thinking about kind of techniques that I deploy, I guess is what your question was, Charlie, about this as well.

Andy: I would say there’s three areas I would focus on to stay ahead of this.

Andy: The first is self-education, staying informed.

Andy: So working for Visa, I’m very lucky that we have an amazing mix of internal data that allow me to look at consumer trends and see where it’s going to make sure that we’re thinking in the right way for our partners.

Andy: Equally, there’s amazing companies like yourselves and third parties that have great intelligence as well.

Andy: I run about what’s happening in this area.

Andy: And so one thing I do is make sure that I carve out the time to actually be able to self-learn, go deep into these different topics, absorb these different data sources.

Andy: And so I have like time blocked in my calendar on a weekly basis, which I’m sure is tricky for most people, given how hectic all of our kind of professional and personal lives are, but it’s something that I absolutely prioritize and even I travel a lot for work and that dead time that you get when you’re at the airport or on a plane, I use that to self-learn as well.

Andy: So staying informed is so critical and you’ve got to kind of take it on.

Andy: I have to take it on myself to continue and learn.

Andy: The second piece, I would say, I would frame it as staying connected.

Andy: We work in such an amazing ecosystem with like great people.

Andy: And again, prioritizing time to be with people that work in this area, be that partners, mentors, peers, thought leaders across the industry is so, so important.

Andy: Just to ensure you’ve got a finger on the pulse of everything that’s happening, you can kind of see the trends that are emerging.

Andy: And yeah, that can be done through informal catch-ups, attending forums or conferences, just making sure that, yeah, all those trends are there and you can pressure test ideas as you kind of like formulate those ideas as well with key mentors, et cetera as well.

Andy: So I’d say that’s the second bucket, making sure we’re hyper connected with industry experts.

Andy: And then the third piece is just be adaptable.

Andy: Like no matter how much you learn, no matter how much you plan, things change.

Andy: And so the approach that I take, and I certainly like encourage my team to do this as well, is to always experiment, try new things, learn quickly off it.

Andy: If it doesn’t quite work, it doesn’t matter.

Andy: We can take those learnings and take ourselves forward, but just be adjustable.

Andy: So as data comes in, you can pivot as needed to get to the best answer.

Andy: So yeah, it’s not always easy, but a combination of staying informed, staying connected with people, and always being adaptable is something that I’ve seen us be able to navigate pretty tricky situations that come out on the other side much stronger.

Charlie: Yeah, I talked to quite a lot of people about that.

Charlie: And I think there is a sort of a sense sometimes that it’s not work when you’re kind of learning.

Charlie: And I’m a strategist, so it genuinely is the definition of my job.

Charlie: But I think it is.

Charlie: It’s so important because you just need one good idea, don’t you, from that continuous sort of investment and new thinking and fresh thinking.

Charlie: And then that can change the whole direction of a program or a co-brand or a performance.

Charlie: So, yeah, I really agree.

Charlie: My top tip is I do 10 minutes scrolling on the sofa when I sit down.

Charlie: And then when I’m out walking the dog, I listen to kind of audio formats and things like that.

Charlie: And that’s my opportunity to learn.

Charlie: I must confess, when I’ve got dead time at the airport, it does tend to be a little bit more watching The Walking Dead or something else really inappropriate.

Charlie: And then trying to squeeze in a bit of a podcast.

Charlie: But often, The Walking Dead and The Glass of Wine kind of wins that for the evening trip.

Charlie: So, yeah, that’s a great tip.

Charlie: It probably brings us on quite nicely as well, because obviously quite a lot of us understand the world of co-brand and understand what that is and how it works.

Charlie: But I’m guessing there’s probably a proportion of our audience who are like, what the hell are you talking about?

Charlie: So it would be really, really great to get a sort of a basic 101 guide to what is co-brand and so that everybody’s got a kind of grounding.

Charlie: Then we’ll get into some more of those examples and how Visa does it.

Charlie: But what do you mean when you talk about co-brand?

Andy: Yeah, we should have maybe probably started with this question to make sure we level to everybody, but it’s a great question.

Andy: Because working in the air, you assume certain things.

Andy: But yeah, let me give you a technical answer to that question.

Andy: A co-brand at its simplest is a payment vehicle, a payment tool that’s directly tied to a brand’s loyalty program.

Andy: So when you use it, you’re not just making a purchase anymore.

Andy: You’re earning rewards, unlocking perks, deepening the relationship with the brand on the co-brand.

Andy: So for the brand, it’s a great way to accelerate their loyalty strategy, or even potentially launch one if they’ve not got a loyalty program today.

Andy: What makes co-brand truly unique is that it’s a partnership.

Andy: It’s a three-way partnership.

Andy: First of all, you’ve got the bank who issues the card and handles all of the financial side, but also brings unique features from their business to the product.

Andy: You’ve then got the brand, the business associated with the product, whether that’s an airline, a hotel, a retail, a fintech, any business that is looking to sell something from launching a program.

Andy: They bring the customer base, the emotional connection, and often the loyalty program to the product.

Andy: Then thirdly, you have the payment network, ideally Visa, I would say, but we provide the infrastructure for it.

Andy: We provide the infrastructure that allows the payment to move around the world almost instantly.

Andy: We bring innovation to help the partners bring it to market and build the product and get it to market quicker.

Andy: I can even offer global reach to make sure we’re thinking about everything in the right way.

Andy: Co-brand at its core is this beautifully unique innovative product that brings the best of these parties together.

Andy: The way that I often describe co-brand in a sense of loyalty is, it’s the fuel on the fire of a loyalty program because it drives engagement, spend long-term customer value because now as a loyalty program, you get your brand, not only associated when a customer is spending in your ecosystem, but your brand is now front and present anytime that that customer uses your payment product to make a transaction outside of your ecosystem.

Andy: Again, that fuel on the fire concept is backed up in the data that we see.

Andy: Because when you look at programs around the world, 50 plus percent of all the points coming into a loyalty program, attributable to the co-brand itself, and that can be even much higher than 50 percent.

Andy: It was super interesting during COVID, and we looked at the airlines in the US.

Andy: Obviously, we weren’t traveling, planes weren’t flying.

Andy: If you’re running one of those big travel loyalty programs, the only way that customers were earning and engaging into your program was through the co-brand.

Andy: The majority of the points during COVID were actually through the co-brand rather than people being on a plane.

Charlie: Lifeblood a lot of those programs, didn’t it, during that period?

Charlie: It caped a lot of them head above water, actually.

Charlie: I remember looking at it as well.

Charlie: What about Visa’s partners?

Charlie: What are they looking for in the co-brand?

Charlie: You’ve talked about that at a high level, but what is the value that it delivers specifically to those partners?

Charlie: What are they after?

Andy: Co-brand, at its core, is a great example of a win-win partnership.

Andy: When we align the strategic priorities of all the parties involved in co-brand, that’s where true success comes from.

Andy: It’s quite rare in the world that we work in where we’re trying to leverage those win-win situations.

Andy: If we can get everybody rowing in the same direction, that’s truly where the magic and the performance happens behind co-brand.

Andy: There’s a number of key strategic reasons that partners would want to launch a co-brand product and what it can mean for that business.

Andy: If you think about the brand, the company, or who launched the co-brand, what are they looking for?

Andy: What can they get from a co-brand?

Andy: Well, the first is much deeper and stronger customer engagement.

Andy: As we talked about with some stats and what the co-brand can do about bringing the brand out of just the individual in-store for want of a better description, usage to the broader customer life cycle, we can get much deeper engagement through that customer by being part of all of their lives whenever they’re spending.

Andy: That just offers the ability to offer a much deeper emotional connection with that customer.

Andy: Because of the construct of the product, it can also allow us to offer the highest level of rewards that we can offer to any customer.

Andy: So it allows us to go a lot deeper with our most valued customers and is a huge retention tool for our customers.

Andy: The second piece that the branded partners often look for in a big strategic unlock is just the wealth of data that can come off a co-brand product.

Andy: When we’re running a loyalty program, we have such great data about the demographics of our customers, the spending behavior or the engagement behavior within our brand.

Andy: But again, the co-brand allows us then to see data about what is that customer doing in the rest of their life cycle.

Andy: So we can then take that data back into our organization and just enhance all of our marketing activities because we better understand who that customer is and where they’re up to in their life cycle.

Andy: So data is the second big piece.

Andy: The third is co-brand can offer a diversified revenue stream.

Andy: Again, because we’re not just earning from when the customer is interacting with us as a company, but we’re now broadening that across everyday use categories.

Andy: That means that we’re getting incentivized for that.

Andy: And it’s a big unlock for growth of any program to diversify that revenue stream.

Andy: So that’s where our branded partners are really looking to the value of co-brand.

Andy: It’s not necessarily the individual revenue I can take off the co-brand.

Andy: It’s the influence and the ability and insights that I can get about my customer base.

Charlie: It’s a real breadth of influence as well, isn’t it?

Charlie: You’ve talked about everything there from emotional connection through to actually kind of incremental revenue generation.

Charlie: So it’s really nice, as you say, if you can unlock that mutual benefit, then that’s quite a killer opportunity for lots of brands and programs everywhere.

Charlie: How does it specifically sort of interact with loyalty programs?

Charlie: Because obviously a lot of our audience are probably sitting here going, I’m running a program.

Charlie: I wonder if I could do this.

Charlie: And then how does Visa play into that space?

Charlie: What does that look like?

Andy: Yeah.

Andy: So thinking about those stats that we heard before about, you know, just how big a piece of a loyalty program a co-brand can make up.

Andy: It truly is like that fuel on the fire as we talked about.

Andy: And so it plays a huge role in taking any loyalty program forward.

Andy: And in terms of your question about how can Visa play in this space?

Andy: Well, yeah, our expertise is truly global and cross industry.

Andy: You know, we’ve worked with partners from every industry sector to help design, launch, bring to market and even optimize co-brands once they hit market.

Andy: Today, we’ve got over 800 partners live with a co-branded program on the Visa network.

Andy: Yeah, so it’s a huge, huge part of the ecosystem.

Andy: And, you know, when I think closer to home from where I am at the moment in the US, seven of the top ten co-brands are on the Visa network.

Andy: And, you know, I often think that this is the kind of secret source, the differentiation of Visa, that we can just help partners grow the largest programs.

Andy: And, you know, there’s no one magic bullet like to solve this.

Andy: It’s genuinely hard work and being scrappy.

Andy: And for me, that’s the that’s the differentiation of Visa.

Andy: And I see that both working for Visa now and previously when I worked with Visa is that the end to end support model that we offer is phenomenal.

Andy: Like you say, we’ll be there, you know, if a partner has a challenge or an opportunity that you want to unlock, then we want to be in lockstep with them trying to open up or solve that challenge.

Andy: And, you know, it’s quite funny, my strategy team were talking to me the other day and we were talking about some stats on this.

Andy: And the proudest metric that I’ve seen, you know, running the Co brand business for Visa is that almost all of our partners look to extend the partnership with Visa, which for me is a testament to the great work that the organization does with partners because we are there all of the time with them, you know, listening to them, understanding their needs.

Andy: And a couple of pieces, I would say, that highlight that.

Andy: One, we have hundreds and hundreds of products that we build, most of them API enabled, so our partners can pack in to them quickly.

Andy: And then that will help, you know, either make a more cost-effective launch or speed up launch, you know, like timeframe to launch.

Andy: One big thing that we developed that a lot of partners are packing into at the moment is instant issuance of a product.

Andy: So I’m not sure if you remember Charlie, but certainly when I was younger, like you used to apply for a credit card, it would take seven to ten business days to come in the post.

Charlie: Yes, remember that well.

Andy: Yeah, the TV you wanted to buy, you were like, oh, kind of don’t bother with that anymore.

Andy: I kind of got over that, that kind of purchasing.

Andy: These instant issuance actually allows us to be able to provision a working co-brand into a customer’s mobile device or put a card on a file anywhere, so they can purchase instantly now.

Andy: So the application process, instead of waiting 10 days for that card to appear in the post, you get it instantly while you’re in the store or wherever you may be.

Andy: So things like that, trying to understand what our partners are trying to solve for their customers, that’s exactly what we do.

Andy: We take that feedback on board and go build it and take it to our partners.

Charlie: Interesting.

Charlie: I suppose that’s a key differentiator in the market as well because it’s so competitive and so cluttered at the moment.

Charlie: That ability to do things instantly must really stand out.

Charlie: Are there any other one or two things that you think brands should be doing there to be relevant and stand out in this space at the moment?

Charlie: Any top tips?

Andy: It’s a big question, Charlie.

Andy: It is.

Charlie: I appreciate it’s not a one size fits all response, but anything you’d say?

Andy: Yeah.

Andy: It’s such a relevant question, particularly at the moment.

Andy: I’ve been at a number of conferences recently, and there’s debate always going around at the moment about, have we hit peak loyalty?

Andy: The average consumer is engaged in more loyalty programs than they’ve ever been before, which creates real risk of loyalty fatigue for us all.

Andy: If every program looks and feels the same, then customers are going to start to disengage.

Andy: Your question about how do we stand out, I think is highly relevant at the moment more so than it’s ever been.

Andy: I’d say there’s two pieces, and I wouldn’t say these pieces are revolutionary or we’ve never thought about them before, but I think the execution of them is so important now in this marketplace.

Andy: The first is all around personalization.

Andy: If you look at that, personalization used to be a nice to have.

Andy: Customers were like, oh, cool, kind of, yeah, okay, you get me, that’s good.

Andy: That’s just no longer the truth.

Andy: If you look at any research or talk to customers, personalization is an absolute expectation.

Andy: If we serve an offer or a product or service to a customer that’s not relevant to them, they’re going to disengage moving to one of the other programs that they have in their program.

Andy: I’m sure we’ve all got examples of when we’ve been served apps that have nothing to do with us or our lifestyle and it’s completely disengaged us and pushed us away from the brand.

Andy: So yeah, again, it’s a topic we’ve been fighting with for a good number of years, but I would say personalization and understanding our customers is absolutely critical to success of any program today.

Andy: Equally, the other piece I’ve mentioned is we just need to be where our customers are.

Andy: For a good while, we’ve focused in on optimizing the experience in the channels that we control that are within our business and that’s still important, but our customers and us as individuals just lead increasingly complex lives.

Andy: You mentioned before that you may be on Netflix or scrolling through social media when you’re on a plane.

Andy: Well, that’s where our customers are, that’s where we need to be as well to bring in our messages.

Andy: Thinking broadly about where we need to meet our customers, where they are is important.

Charlie: I’m now wondering how you’d get co-branded into a Walking Dead storyline.

Andy: Okay.

Andy: Let me think about that.

Andy: I’ll come back to you on that.

Andy: Could be an interesting value proposition.

Charlie: Yeah, definitely.

Andy: We could design on that one.

Andy: Yeah.

Andy: But thinking about this meeting where our customers are, this is going to change dramatically in the not too distant future.

Andy: A large driving force behind that is the rise of AI and the agents that we all use now to help us in our daily lives, like ChatGPT or M365 or whichever agent you use, is going to transform how customers do commerce and how they purchase things.

Andy: The best example I can give you of this is think about, you’re booking your annual holiday for you and the family.

Andy: It’s quite a time-consuming exercise because typically, people would go online, they’d research about a destination to go to, they’ll find a destination, you’ve then got to find a hotel, you’ve got to find flights.

Andy: Not only that, you’re looking across multiple sites, potentially starting on an online travel aggregator, going through to individual hotel or airline sites, looking for the best deal.

Andy: Once you’ve done all of that, you’re then looking for trips while you’re there, restaurant reservations while you’re there, maybe trips or excursions.

Andy: It takes a long time to build that trip.

Andy: Through some of these agents, what we’re seeing is an area called Agented Commerce come to the fore.

Andy: And what will happen here now?

Andy: Think about that experience.

Andy: But think about the experience when you could jump on to any one of those agents, ChatGPT, et cetera, and you could just simply type in, find me a holiday destination that’s luxurious within a five-hour flight under this price point and book meals every other night for me.

Andy: And it will go away and do all that and bring it back for you.

Andy: And so that amazing experience is not far from being deployed.

Andy: We will see it in the next six to 12 months.

Andy: And so, you know, that’s a huge opportunity, but also a threat for us that work in the loyalty space.

Andy: Because if consumers are moving to this model to do commerce, how do we get our message, our program involved in that experience?

Andy: And so, you know, again, from a Visa perspective, we’re heavily involved in this and helping partners think through it.

Andy: But it’s so important we stay ahead of all these trends of where our consumers are going.

Andy: Otherwise, we’re on the risk of becoming largely irrelevant.

Charlie: And it can happen so fast.

Charlie: I think that’s the thing as well, isn’t it?

Charlie: Like you click your fingers and then suddenly the world operates differently.

Charlie: And I think that brings us nicely in to thinking about Gen Z, actually.

Charlie: And, you know, what impact that’s going to have.

Charlie: Because, you know, you and I are having to learn AI.

Charlie: And actually, we’re adapting quite quickly.

Charlie: We’re digital natives.

Charlie: And then I spend, you know, 10 minutes with my kids and I realize just how far behind I am, you know, wrestling them like, no, it’s not appropriate to use it for all your homework.

Charlie: But some of your homework is fine.

Charlie: It wouldn’t occur to them.

Charlie: And we certainly notice it with the kind of the 20 somethings at work as well, actually.

Charlie: They’re just so much more adept with it and experimenting with it and learning it that much quicker.

Charlie: I know that’s a key factor.

Charlie: But what other sort of things are affecting, you know, the rise of Gen Z in your kind of customer base?

Charlie: Is that playing a role in loyalty and co-brand?

Charlie: And then given the scale of that generation, what kind of impact is that going to have?

Andy: Yeah, yeah, yeah.

Andy: Yeah, they’re definitely making an impact.

Andy: The latest stats that I saw is that Gen Z, and by the way, it’s nice to speak to an English person living in America to call it Gen Z.

Charlie: Oh, sorry, Gen Z, I should be saying, shouldn’t I?

Charlie: Sorry, sorry.

Andy: I mean, they’re a huge part of the ecosystem already.

Andy: Over 30 percent of the global population are now Gen Z, and they’re purchasing potentially huge.

Andy: The latest stats that I saw is that they’ve got the potential of like 12 trillion US dollars in spend, and so they’re not an emerging influence.

Andy: That’s true economic power that this generation has.

Andy: Yeah, it’s huge.

Andy: You hit the nail on the head with a couple of pieces because they are just so digitally native.

Andy: They’ve grown up on a mobile device, and they’re very comfortable navigating a whole very wide range of shopping channels.

Andy: They’re used to using online marketplaces through to social media.

Andy: They’re quite happy to bring innovation, like click and collect.

Andy: So they’re starting in a digital journey and moving into a physical journey.

Andy: Again, thinking through how can we embed ourselves in these channels are really critical.

Andy: TikTok, which is a huge platform for GEMSAT.

Andy: It’s not just an entertainment platform, it’s a discovery tool for what they want to buy, it’s a search engine when they’re looking for things, a checkout platform, all rolled into one.

Andy: Again, we have to just think about where our customers are and where they’re going, particularly GEMSAT that are very digitally native and moving up that curve.

Andy: Payments released a report that shows the credit unions, which is traditionally a segment that most consumers in the US don’t engage with that fully.

Andy: They prefer the older generations go with the big banks, but GEMSAT are moving towards credit unions because they feel a sense of that connection to the local community and support where that credit union is.

Andy: Whilst we’ve got to concentrate on how do we get into that tech savvy mindset of GEMSAT, it’s also how do we give them that feel of being grounded and connected?

Andy: And for us in loyalty, I guess that means two things, like being relevant in those digital spaces, especially social and mobile, where they are and spend most of their lives.

Andy: And then they’ll trust an emotional connection with this generation.

Andy: So they’re not just looking for the traditional rewards narrative of give me points or cash back.

Andy: They actually want a relationship with the brand and have shared values with them.

Charlie: Yeah, no, I think that’s really key.

Charlie: And we see that against actually the broadest areas of loyalty as well as within co-brand as well programs.

Charlie: I’m really having to adapt to get that balance right, actually.

Charlie: And there’s this quite a big say do gap as well.

Charlie: We find with this generation, there’s aspiration and action that’s quite different, which brings on to a good question actually about how you use data and personalization, because I think that’s really key, isn’t it?

Charlie: There’s things people say and there’s things people do.

Charlie: And then how you actually get that right in the co-brand space where you’re sitting on such a vast range of kind of data sources is particularly interesting.

Charlie: So what are some of the ways that brands can leverage that consumer data show?

Charlie: They really know their customers.

Charlie: And then how can they transform that into actionable insights, actually then make it feel like a personalized experience?

Charlie: That’s a really big question.

Charlie: But it would be really interesting to get that from your point of view, because you’d probably sit on some of the richest data sets of anyone in the loyalty space.

Andy: Yeah, happy to talk about this.

Andy: And you’re right, it’s a big topic.

Andy: We could probably talk for a couple of days around this one.

Charlie: A whole other episode, but we won’t.

Charlie: Don’t worry, listeners.

Charlie: Don’t worry, listeners.

Charlie: We’re moving towards the end now.

Charlie: But yeah, I wanted to round out on a kind of a chunky question for you, Andy.

Andy: Yeah, no, so let me offer some insights and thoughts on this.

Andy: Again, building those personalized connections is so critical.

Andy: When we when we think about loyalty and co-brand transactional loyalty, so yeah, the cash back, the reward, the features that we offer on a program is still important.

Andy: It’s a hugely important factor, particularly with acquisition of customers into a program.

Andy: But the thing that’s making customers stay with us is that emotional connection and that all comes off the personalization and understanding who those customers are.

Andy: I saw some recent survey and stats that looked at customers and talked to them about the personalized interactions they would get in, and over 70 percent of customers now fully expect personalized interactions.

Andy: So as we talked about before, it’s not a nice to have, it’s a must-have and customers are expecting it.

Andy: Almost the same amount of customers when you talk to them, if they don’t receive that personalized offer and get frustrated with a brand and will look to ultimately leave.

Andy: So poor personalization will lead to attrition of the program and won’t allow us to grow in the ways that we want to grow.

Andy: So making sure that we can continue to go deep into this is absolutely critical.

Andy: So a couple of things that we’ve seen work well in this space.

Andy: The first is, again, for a good while, we’ve all been talking about segmentation and even micro segmentation to understand the different customer groups that we’ve got.

Andy: That’s becoming more and more important that we need to tailor experiences to those different customer groups.

Andy: The approach of one size fits all is no longer relevant for the world that we live in.

Andy: In the co-brand space, we see that play out in the form of partners not just putting out one product, but multiple products to engage all of their customer base.

Andy: That could be, they launch a number of credit card products, but they could equally launch a debit or a prepaid offerings to ensure that we’re engaging maybe Gen Z.

Andy: I’ve got the American angle for you on Gen Z.

Andy: Perfect, well done.

Andy: I engage those customers that may not be, yeah, thank you, that may not be quite ready for credit yet, but we want to get them into our loyalty program.

Andy: So I’d say that segmentation is pretty cool.

Andy: Again, as we talked about, time and context is also critical.

Andy: So making sure we understand what a customer needs at exactly that moment is hugely important and delivering that message through a channel where they are.

Andy: If we can’t get to a customer in near real-time for that need, then we’ve probably lost the opportunity.

Andy: Something, again, from a Visa perspective, we’ve been thinking about is how to take both of those notions and go even deeper.

Charlie: A really fascinating answer.

Charlie: I’ve worked in loyalty for so long and I find Cobra just a fascinating area.

Charlie: There’s some really, really good answers.

Charlie: I’m sure, however, that all our listeners are going, oh, actually, or our watchers are going, oh, actually, I’ve got a ton more questions that I would love to ask, but they want to find out more.

Charlie: How could people reach out to you?

Charlie: What’s the best way for them getting hold of you if they have got follow-up questions and they’d like to learn more?

Andy: Sure.

Andy: First of all, I would say, if you’re already a partner of Visa and you have an account executive, reach out to your account executive.

Andy: They’ll be happy to connect us or help with any call-up that may be your questions to answer.

Andy: Equally, I’m on LinkedIn.

Andy: Please feel free to reach out to me.

Andy: I’m happy to connect.

Andy: Yeah, my name is Andy Chalcroft.

Andy: Chalcroft is a fairly unusual name, so I’m pretty easy to find on LinkedIn.

Andy: Yeah, happy to connect there as well.

Charlie: Excellent.

Charlie: We’ll make sure we put that link in the show notes as well, so people can just click through rather than having to spend hours LinkedIn hunting.

Charlie: Well, that was amazing.

Charlie: Really great answers and really brilliant insight, and a lovely blend of stories and stats and user cases as well.

Charlie: Thank you so much.

Charlie: All that’s left for me to say is to say thank you very much from Let’s Talk Loyalty.

Andy: Thank you.

Andy: Thank you from my side.

Andy: Thank you for having me.

Andy: Greatly enjoyed the conversation.

Andy: I love the show and thanks for having me.

Andy: Wonderful.

Paula: This show is sponsored by Wise Marketeer Group, publisher of The Wise Marketeer, the premier digital customer loyalty marketing resource for industry relevant news, insights, and research.

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