TrueLoyal: Building Loyalty That Creates Incremental Value (#807)

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: If you work in loyalty marketing, join us every week to hear the latest ideas and insights for loyalty marketing specialists around the world.

Bridget: Welcome to Let’s Talk Loyalty and Loyalty TV, a show for loyalty marketing professionals, where we feature insightful conversations with loyalty professionals from the world’s leading brands.

Bridget: My name is Bridget Blaise-Shamai, and today I’m delighted to be interviewing Jacek Materna, a successful technology executive and entrepreneur, having founded several technology ventures focused on software security, SaaS leadership and customer loyalty programs.

Bridget: He is CEO of TrueLoyal, our featured company today.

Bridget: In today’s episode, we’ll learn a bit more about Jacek and TrueLoyal, the company formed from the merger between Tint and Zenrelo, two companies with deep roots in user-generated content, advocacy, and loyalty, resulting in the only platform that combines engagement and influence in one connected platform.

Bridget: You’ll learn today what TrueLoyal delivers for its consumer brands, retailers, and CPG clients, and what they then in turn deliver to their end customers.

Bridget: A great conversation awaits, so let’s get started.

Bridget: Welcome, Jacek, to Let’s Talk Loyalty and Loyalty TV.

Jacek: Hey, Bridget.

Jacek: How are you?

Jacek: Nice to meet you.

Paula: Great to be here.

Bridget: Nice to meet you.

Bridget: Thanks.

Bridget: Doing well and hope you are as well.

Jacek: Absolutely.

Bridget: So we have a few questions we like to kick off the interview with before we really get into the meat of the conversation.

Bridget: And that first question is, please tell our listeners, which non-fiction book have you found to be particularly helpful or impactful to your career?

Jacek: Yeah, there’s so many.

Jacek: So for me, I think it’s James Collins, Good to Great.

Jacek: He’s got a bunch of books out there, but I think it’s shaped the way I run all my companies, just philosophy on things.

Jacek: So all the little things from small steps, create big wins to just the whole concept of being really specialized and focusing on what you’re good at.

Jacek: So yeah, Good to Great, just a great book.

Bridget: Super.

Bridget: Thank you for sharing that.

Bridget: So let’s build upon that a bit more for our listeners, because frankly, you come from a bit of a different background than most of our guests.

Bridget: So please tell our listeners a bit about yourself and how you got where you are today.

Jacek: Yeah, absolutely.

Jacek: So I think I’ll start.

Jacek: I’m going to start right at the beginning.

Jacek: So I was born in Poland, moved to Canada in the 80s, right?

Jacek: So I grew up in the snowy north, so to speak.

Jacek: And right out of college, started a company, software business, a cybersecurity company.

Jacek: So I was fortunate enough to sort of have a lot of people around me, great timing.

Jacek: And so I did a couple of businesses up in Canada and then made the move to the US down in San Antonio.

Jacek: So I’m down in Texas in 2008, 2009.

Jacek: It was crazy times around like the financial market.

Jacek: So it was a great opportunity to sort of like end one chapter, begin the next.

Jacek: And that’s where I met early SkillWorks.

Jacek: So SkillWorks is our private equity fund that owns TrueLoyal, one of our businesses, the one I’m running.

Jacek: And I’ve been in San Antonio 15 years, got my first glimpse of the power of providing insights to customers at a company called Enflux.

Jacek: It’s a startup, for example, in San Antonio, still on the board there.

Jacek: So we could talk probably a little bit about that, how it ties into loyalty.

Jacek: And then during COVID, actually, I did a little bit of a stint on the West Coast.

Jacek: I was up in Oregon.

Jacek: I was at an asset management business out of Wall Street.

Jacek: We did some crazy stuff in mortgage fintech that ended up selling.

Jacek: So we were looking back.

Jacek: What do we do?

Jacek: We’re in Oregon.

Jacek: And we decided to come right back to San Antonio.

Jacek: So I came back, ran a company called Full Circle Insights.

Jacek: It’s a marketing attribution business on Salesforce.

Jacek: Really exciting that ended up finding a buyer.

Jacek: So we sold that company.

Jacek: And then TrueLoyal, right?

Jacek: So I’m the CEO of TrueLoyal today.

Jacek: And that’s sort of in a nutshell, start to finish.

Bridget: So is it been common for you to be the CEO of one of your portfolio companies?

Bridget: Or was TrueLoyal just a terrifically and unique opportunity for you?

Jacek: Yeah, that’s a great question.

Jacek: I think so.

Jacek: I find that in life, things come around like on timing, right?

Jacek: So the sort of the universe kind of sorted the deck.

Jacek: And the fund had an interesting idea around bringing together a couple of things and bringing this concept to the market, which today is TrueLoyal.

Jacek: And I said, hey, we need somebody that can help us grow this company.

Jacek: We think it’s going to be a category leader.

Jacek: And I just love the space.

Jacek: I love the consumer space.

Jacek: You know, I have a B2B background, but there’s a B2C or B2B2C concept around loyalty.

Jacek: So it was just a perfect mix.

Jacek: And like I said, it was in San Antonio.

Jacek: I’m in San Antonio, and that’s how I got to the seat.

Bridget: Well, listen, I think TrueLoyal offers truly, as we’ve already talked about, a unique proposition to both its brand clients and then there and consumers about engagement and influence and loyalty transactions all coming together.

Bridget: I really am so looking forward to our conversation and for the benefit of our listeners, what they’re going to be able to hear and listen and review thereafter.

Bridget: Okay, so our last kind of starting out question, what’s your favorite loyalty program?

Jacek: I know it’s a perfect example.

Jacek: So I think for me, it may not be the most obvious, but it’s Amazon Prime.

Jacek: So I’ve been tracking Prime since zero day, and it’s not really even a program, right?

Jacek: I think this kind of marketing of around like you have a loyalty program.

Jacek: Prime to me is just one of the most leading world-class personifications of easy, convenient, seamless, it’s actually what loyalty should be, which is in the background.

Jacek: It’s not even in your face.

Jacek: It’s so convenient, so obvious, it’s the place to go, and that’s what builds and earns loyalty.

Jacek: So Prime, I mean, I don’t know how many packages you get a day at your house, but it’s an incredible thing that they’ve built.

Jacek: And if you use the loyalty lens, they built this sort of paid model, right?

Jacek: You have to pay, you get these feature benefits.

Jacek: So it’s not necessarily like a traditional loyalty program per se, but that is hands down my favorite.

Jacek: I think they are an incredible business, and they continue to be the company that everybody has to figure out.

Jacek: I think every board meeting starts with, okay, guys, what are we doing about Amazon?

Bridget: Agreed, agreed, agreed.

Bridget: I mean, they really set a global standard.

Bridget: And what I think they did that brands still aren’t doing enough of, are demonstrating to their consumers how they respect their time.

Bridget: You know, you’ve already hit on it, it’s easy, it’s frictionless.

Bridget: I don’t even think about it.

Bridget: And that to me is the greatest action a brand takes, is when they respect the time of their consumers, which is a path towards their loyalty and commitment to the brand.

Bridget: So I agree with you.

Bridget: I think it’s a terrific brand that’s become household around the world.

Bridget: So thank you for that.

Bridget: That was a great explanation as to why Amazon.

Bridget: Okay, so let’s get at this here.

Bridget: We’ve touched on a bit about True Loyal, but please let us know a bit more what is True Loyal, and the reasons behind merging Tint and Zinrullo.

Jacek: Yeah.

Jacek: So I’ll go right back to the beginning, but I’ll try to keep it short.

Jacek: So Tint, actually, Tint Up, Tint UP was founded 2011 in LA, and it comes from the UGC, so user-generated content, the social media space.

Jacek: It was there before the social media networks really took hold, right around the time the iPhone was coming out and really booming, things like that.

Jacek: And it was essentially a business that we had acquired.

Jacek: Scaleworks had acquired it in 2018, and it was around social media content generation.

Jacek: And this again was 2018, so I think it had a different view of what was the value proposition then versus what it is now.

Jacek: Wasn’t necessarily tiled to loyalty at all.

Jacek: It was a standalone company.

Jacek: We ran it for a number of years.

Jacek: And so that company ran into another company called Vesta, so V-E-S-T-A.

Jacek: So this founder built that business right around when we bought Tint.

Jacek: And she, Sue, her name is Sue French, she basically had this founder insight that said, look, companies today and at some point in the future are gonna need control of their own community of customers.

Jacek: Meaning, like if they don’t have direct line of sight to their customers, they’re gonna want a place to get their customers in a digital marketplace, digital forum, some sort of area where they can all be together.

Jacek: And the brands, right, which are the primary customers of this company called Vesta, are gonna want to do lots of fun things with their customers.

Jacek: Maybe they’re gonna send them on activities.

Jacek: Maybe they’re gonna want to get product insights like, hey, we got this new product launching.

Jacek: Is it good?

Jacek: Is it bad?

Jacek: These kinds of things.

Jacek: They don’t necessarily want to rent that out to the social media networks, right?

Jacek: And so that company and Tint, there was an interesting fusion that happened there, which says, look, we’ve got a business that creates user-generated content, so authentic content.

Jacek: It’s the reason why Hyatt uses us, and we manage a lot of their programs for them.

Jacek: They want authentic content that their customers, their users, their customers are posting, are excited to be doing these experiences.

Jacek: The brands want to own that content and use it for their own marketing.

Jacek: The two came together and said, hey, we’ve got a platform to get them all together, call it a private social media network, not a public one.

Jacek: Then we’ve got this really cool capability that can let brands manage marketing content essentially that their customers are making at scale.

Jacek: Those two came together, and it was an interesting value proposition in 2023.

Jacek: We continued to hone in on the use cases.

Jacek: Then just a year later, a really interesting company came to us called Zinrello.

Jacek: Zinrello was a company that had been around for a long, long time.

Jacek: They came from the rewards loyalty space.

Jacek: This is where loyalty started to finally come take shape, right?

Jacek: And we kind of looked at it and said, okay, we’ve got this community product.

Jacek: We’ve got this ability to generate incredible authentic content.

Jacek: Now if you connect that to this whole universe of loyalty, whether experiential, transactional, all of this e-commerce boom that happened during COVID, this could be something interesting.

Jacek: And so those three legs of the stool were sort of the underpinnings of what we were making at True Loyal, right?

Jacek: And that was essentially what, why I joined.

Jacek: We rebranded the whole thing around a single brand, which is trueloyal.com.

Jacek: But that’s kind of some of the history around how we got here today.

Bridget: Yeah, so, you know, I love that you used a travel example.

Bridget: We have a lot of travel listeners on this podcast.

Bridget: And certainly I think Hyatt is just one of the best hospitality brands bar none.

Bridget: So it really is a statement to me that they chose you to partner with them.

Bridget: And just given the wonders of travel and all that individuals want to create around content and that TrueLoyal in all of its aspects, its three legs to its stool, bring that together for brands to go and do really smart things that lead to engagement, that lead to loyalty, and ultimately to me, the holy grail of leading to customer commitment.

Jacek: Yeah, yeah, 100%.

Jacek: I mean, we love hospitality.

Jacek: I mean, it’s interesting, hospitality.

Jacek: I mean, it’s something very intuitive.

Jacek: We all stay at hotels, travel, everyone loves travel.

Jacek: I don’t know anyone that doesn’t like to travel.

Jacek: Like, it’s experiential.

Jacek: It’s that analog counterpoint to the digital side, right?

Bridget: Which is a whole area.

Jacek: That’s right.

Bridget: That’s right.

Bridget: And there’s every single emotion present when you’re traveling.

Bridget: So, you know, I think it’s just a great example.

Bridget: Okay, so kind of closing out on this, you know, is there anything about what you have created here with the Three Stools?

Bridget: And let’s just call it a modern loyalty program.

Bridget: What is needed to have a modern loyalty program?

Bridget: And how best is what is, sorry, and how best is what is measured from it?

Bridget: Yeah.

Jacek: Yeah.

Jacek: So, I mean, there’s probably a couple of ways to answer this one.

Jacek: But, you know, for me, so one interesting area was when I spent, when I was running Full Circle Insights, right?

Jacek: We were marketing a business that delivered attribution to marketing teams.

Jacek: So CMOs can answer, okay, we’re doing all these activities.

Jacek: What kind of lift is it generating?

Jacek: Are we getting anything out of these things?

Jacek: And so that on top of all, just sort of my background in kind of finance, sort of private equity, some of the mergers and acquisitions side, I’ve always been really close to these concepts of ROI, attributable gain, incrementality.

Jacek: I love talking to my teams about return on invested capital.

Jacek: I mean, some people could fall asleep talking about return on invested capital, but that’s the way I like to run companies is like, look guys, if we’re building a platform, people are paying for a piece of software, an engine, it needs to do certain things.

Jacek: It needs to deliver obviously key things to the bottom line, right?

Jacek: At the end of the day, this is why it exists.

Jacek: I mean, it’s important to measure it, right?

Jacek: So I think the thing that we’re bringing together on top of those three capabilities, the content, the community, and the super flexible rewards tiering system, right?

Jacek: The three pieces is I want to give our customers the tools that they need to do all that, and they need to have the ability to show proof, and proof in the sense that setting up loyalty needs to create lift, it needs to create incremental gains, right?

Jacek: If you basically have a loyalty program, and we’ll talk about this later as well, that just you’re sort of paying for things that were already going to happen.

Jacek: That’s right.

Jacek: You’re not really doing anything, right?

Jacek: So, and I think that’s such a big misnomer in the industry.

Jacek: People are not necessarily thinking about it that way.

Jacek: And I think the underpinning of that is not a lot of our, of the platforms, software products that come to market.

Jacek: So these tools have been really focusing on delivering this proof, this incrementality, right?

Jacek: What is it that I’m getting?

Jacek: And then helping the teams obviously get more, right?

Jacek: This is why you’re running a loyalty program.

Jacek: So instead of a busy program, as I call it, it’s like an effective program.

Bridget: Yeah, no, great, great choice of words here.

Bridget: And frankly, it could be hard to measure.

Bridget: It can be hard to attribute.

Bridget: And that to me is just an excuse.

Bridget: You still have to demonstrate the investment that you have in these programs and standing up a community and creating experiences drives more benefit to the brand and typically at the top line.

Bridget: So great explanation.

Bridget: So thank you.

Bridget: Okay, so let’s start getting into some of the real life elements with your clients.

Bridget: With the official rebrand of TrueLoyal, the company champions that loyalty isn’t bought through software, right?

Bridget: It’s earned through experience.

Bridget: What is the interaction that you have with your brand partners on their need to evolve beyond their legacy points and discounts programs to construct something that truly earns their customer’s loyalty?

Bridget: And do you have any examples you can share?

Jacek: Yeah, 100%.

Jacek: I mean, I think, you know, one that comes top of mind is, you know, there’s a brand that Nestlé owns called Purina, right?

Jacek: Pets, you know, everyone loves pets, you know.

Jacek: And pets are, I mean, pets are an incredible industry.

Jacek: I mean, last I checked Purina was topping 22 billion in annual sales.

Jacek: I mean, it’s just a monster business, right?

Jacek: And we’ve been with them for a while.

Jacek: They’re doing some innovative stuff.

Jacek: You know, they’ve got this fur buddies community where essentially, you know, everybody loves pets.

Jacek: Yeah, a lot of people real excited.

Jacek: I mean, we’re talking about people that are excited about this topic.

Jacek: And so the difference, I think, between just sort of running a coupons program, sort of this, let’s give away 10% or send you an email when you close your cart, just so you come back.

Jacek: I mean, people have figured out the game, these sort of transactional 10%, clip this, clip that.

Jacek: I think the consumer and the brands, for different reasons, need or are looking for more.

Jacek: So if you’re going to have a loyalty program, and this is sort of where we come in on our, we have a sort of consulting side and we have a software side, we actually bring it together as one package.

Jacek: I don’t think you can disconnect the two.

Jacek: Where we just say, look, so you guys have a lot of excited people about pets, talking about pets.

Jacek: How do we get them into a safe place that’s managed and run by Purina?

Jacek: And then you can do lots of cool things with it, right?

Jacek: And reward people.

Jacek: People want to be rewarded.

Jacek: It’s like a social element to the group.

Jacek: And it’s not just my own points on my own little profile page.

Jacek: So you could send the group of people on missions, we call them.

Jacek: So for example, Purina does a lot of product reviews, like, hey, how is this product performing?

Jacek: And so in the old days, these focus groups, there’s different ways to do this, but they’re getting just incredible data from their most excited customers.

Jacek: And their customers are obviously generating reviews, about the products.

Jacek: And so it’s just much more than just earning and burning some points, which is sort of an individual sort of kind of view of it.

Jacek: This is like a, the community is all the fur buddies, right?

Jacek: There’s all crazy about cats and dogs.

Jacek: And again, it’s just created incredible, I think cohesion across the customer base.

Jacek: It’s not just me, it’s all of us.

Jacek: And then they’ve had incredible lift from the program or the community around like how much content it’s generated.

Jacek: Because the marketing teams over there, they love people taking pictures with their dog, their cat, this, that.

Jacek: I mean, it’s a gold mine, right?

Jacek: They can just, they take that, they can own the UGC and it’s high quality.

Jacek: And then they use it for marketing and brand promotion.

Jacek: And that ends up actually getting your customer to bring in new customers.

Jacek: So the concept of having loyalty or a loyal fan base acquire new customers is that I think a unique proposition, because it’s typically always been thought of as like retention.

Jacek: Like you get them, so keep them.

Jacek: And if you’re doing acquisition, it’s this whole other thing.

Jacek: I think it’s actually one flywheel, right?

Jacek: Retention and acquisition.

Bridget: So I really have enjoyed spending time on the website, where I think you all are pretty generous at sharing use cases and results.

Bridget: And I’ll tell you what struck me about this particular campaign was the statement you all make, that pet owners trust other pet owners, not a brand’s marketing.

Bridget: And so what you did to still make all of that happen and then drive almost 100,000 new members into the Nestlé Purina ForBuddies program.

Bridget: And then the thousands and thousands and thousands of reviews you enabled for them to generate.

Bridget: So to me, it’s just again, there’s not just one trick to the pony here that’s going to get the brand, the type of outcomes they need.

Bridget: You’ve got to have breadth of options here.

Bridget: And I think you’re drilling into this community and social media, etc.

Bridget: It’s terrific.

Bridget: And again, for our listeners, you can read more about it on the website.

Bridget: Okay, so thank you for that.

Bridget: I thought that was just a great example to zero in on.

Bridget: And so, you know, this is something that I find to be an old problem and y’all have figured out something to do about it.

Bridget: A major differentiator for TrueLoyal is its embedded receipt scanning technology that unifies the online and offline purchase behavior.

Bridget: I mean, that’s holy grail stuff, right?

Bridget: So, you know, in an omni-channel world, how critical is capturing that offline receipt data for brands who are otherwise flying blind here between what they can see on their digital campaigns and what is not so clear in their physical storefronts?

Jacek: Yeah.

Jacek: I mean, this is like one of my favorite, and it’s probably my favorite area too.

Jacek: I don’t know.

Jacek: I think it’s because it’s sort of tied to the not.

Jacek: I’m a sucker for the analog, so to speak.

Jacek: But I kind of call this the world of clicks and bricks.

Jacek: So clicks being online, bricks being obviously brick and mortar.

Jacek: So, you know, we have a great customer in this area.

Jacek: That is a great use case, right?

Jacek: So one of the largest premium mall owners in America, we were lucky to join them early on as they were building this whole thing out with a lot of their great partners.

Jacek: So we play a small slice of that as a technology provider.

Jacek: And, you know, they got malls everywhere.

Jacek: Malls are booming.

Jacek: I mean, people are not only back, but like super back.

Jacek: I mean, Gen Z wants experiences.

Jacek: My daughter is going to the mall all the time.

Jacek: They got billions of visitors to all their properties.

Bridget: You want analog.

Jacek: Yeah.

Jacek: And so there’s this pent up demand, obviously sort of maybe the COVID era has sort of generated a little bit of an extra piece there.

Jacek: But I would also argue that they’ve always been strong.

Jacek: I mean, they’re stronger than ever now.

Jacek: And so it’s an incredible use case.

Jacek: And what’s interesting about them is that they are doing a lot of innovative things in the space and they want to understand what’s going on in these malls.

Jacek: What do their shoppers want?

Jacek: And I think not so much like what do their shoppers want from one of their tenants, like a Prada or something like that, being these premium things.

Jacek: You know, that’s a different conversation.

Jacek: I’m just saying as an owner of all these assets, you know, you have all of these incredible stores, they have experiences, they have food courts.

Jacek: Like you need to know what’s going on in these properties, right?

Jacek: And I think up to this point, there’s been a limited view on that, there’s a limited capability.

Jacek: And so we’ve partnered with them on this app, they have a program in there.

Jacek: And there’s a small piece of that app that does, for example, the receipt scanning.

Jacek: So you can get rewarded for uploading receipts, and that’s a highly valuable transaction for the business to understand how they can improve the malls, how they can help tenants.

Jacek: You know, again, having a better understanding of what your customers are doing is super critical.

Jacek: I mean, this is happening in retail and shelf.

Jacek: So I just love this example because it’s so analog.

Jacek: I’m talking big malls.

Jacek: You know, there’s one up at San Marcos, all over the country, and it’s just such a great use case in this sort of world of bricks.

Jacek: There’s an online component.

Jacek: All the stores have online.

Jacek: Some have their own programs, all of that stuff, but it’s sort of this fusion, right?

Jacek: So they buy online.

Jacek: Are they coming back in store?

Jacek: I mean, typically, people can’t answer that question.

Jacek: I’m surprised at how many people just don’t really know.

Jacek: Is this a…

Bridget: That’s right.

Bridget: Try Jacek.

Jacek: Where did they start?

Jacek: And so we’re trying to really solve that.

Jacek: And I think it’s going to be a big focus of our road map over the next 24 months, so stay tuned.

Jacek: There’s going to be a lot of crazy stuff that we’re going to be talking about in that area, because it’s just such an obvious element to what needs to be solved.

Jacek: And I don’t think anyone’s solved it the way we’re solving as part of this three-legged stool, single customer profile, the world of clicks and bricks, as I call it, bringing it all together.

Bridget: That’s right.

Bridget: I mean, how can you create something that feels like an Amazon seamless, frictionless experience when you are the bricks and clicks?

Bridget: And the other thing I just thought was so interesting on what you were helping.

Bridget: It’s not only like helping get the traffic into the mall, but extending dwelling time.

Bridget: How is it that they keep them engaged enough that they aren’t just running in and running out of the mall, they’re there for a bit of time, which with time leads to commerce, right?

Bridget: So all of that, I think, is just really spot on stuff that I think is unique.

Bridget: And your point of distinction of what TrueLoyal is doing in the market for its clients.

Jacek: Yeah.

Jacek: And like I said, they have such a world class team.

Jacek: We’re sort of in the background with the tech and those pieces, but they have such a world class kind of loyalty operations program.

Jacek: And they’re only getting started.

Jacek: So yeah, really cool.

Jacek: And we’re really fortunate to be partners with them.

Bridget: So consumers, I’m kind of building on this, consumers trust other consumers for more than they trust the brands themselves.

Bridget: So how does TrueLoyal practically operationalize customer reviews and community advocacy so that it directly feeds back into the client’s loyalty engine?

Bridget: Yeah.

Jacek: So, so many stories.

Jacek: I mean, that’s why I love all these questions.

Jacek: I mean, I probably single out, so we’ve got a great customer, Hero Cosmetics.

Jacek: They’re in the beauty space.

Jacek: They’ve got this squad called the Hero Skin Squad.

Jacek: Again, another sort of consumer story here, consumer brand story.

Jacek: So, you know, Church and Dwight bought them a few years back.

Jacek: We’ve been with them for a few years.

Jacek: And so they have a brand-owned community that is like full circle.

Jacek: I mean, they’re doing product surveys.

Jacek: They’re having customers talk to the brand.

Jacek: Brand managers are getting like really interesting insights.

Jacek: They’re obviously getting all the UGC.

Jacek: There’s like the metrics speak for themselves.

Jacek: I mean, in the first, I think, 100 days, they were getting double digit, like, you know, purchase conversion and average spend per members, you know, NPS.

Jacek: I just think, especially in like beauty, because we have a lot of beauty customers, like it’s such a it.

Jacek: I wouldn’t say it’s a it’s a necessary thing, but people like to be doing stuff as groups.

Jacek: There’s a group mentality to consumerism, right?

Jacek: It’s not just like me individually, my purchase profile.

Jacek: So I think, like, for example, beauty and cosmetics, it’s a particular sort of cohort of the of the market and things like that.

Jacek: But they’re really excited about those products, right?

Jacek: So again, it’s just having having the customer at a channel where the brand can directly talk to the customers.

Jacek: And as you know, right, I mean, a lot of these heritage brands, they may not have a starting point where they have direct access to the consumer.

Bridget: That’s right, right.

Jacek: Yeah, they’re being held hostage by a retail shelf, vendor acts and all of that stuff, right?

Jacek: Which maybe we’ll talk about.

Jacek: But being able to just hear from your customer directly, I mean, like as a brand manager or team, I mean, that’s just gold, right?

Jacek: And I think that’s probably one example that I would share around like this advocacy loop because they’ve been so effective at using all of those activities to increase members, right?

Jacek: So like people just like to talk about the dry shampoo, and then it goes viral on social media, and then it goes right back to the squad, right?

Jacek: And so it’s this loop and from a brand, right?

Jacek: If I’m hero, I mean, we’re not paying influencers, right?

Jacek: It’s like, this is an organic sort of customer led initiative, which I think is the most authentic in a lot of ways, of course, as we talked about where it’s the authenticity of your best customers or your customers bringing in new excited customers.

Jacek: So again, I just think like that’s such a great story, and they’ve done a great job.

Jacek: I mean, they got a killer team on that side and our team’s partnering with them.

Bridget: So what they’re doing to make all this happen is sending out sample products.

Bridget: That’s not terribly costly to do, but smart.

Bridget: Having their customers taking these surveys, taking polls, and then allowing them or setting up something that the brand is actually able to talk directly to their customers.

Bridget: So all of these things just hit on the path to success and the metrics prove that out.

Bridget: And you also have a lot of other stories that, again, generously share on your website.

Bridget: And Arm and Hammer is another one of them.

Bridget: This is something that’s been around since the start of time.

Bridget: And here you all have helped them through the simple solutions, create a community of like-minded users of the product, so they learn how to have other uses of the product, with great impact back to the brand.

Bridget: So all of this is good stuff for our listeners to be paying attention to and doing what they can to adopt it for their own selves.

Bridget: Okay, but it does kind of lead to a reality that it’s been around for a while, that it’s not okay just to keep them say, oh, everyone’s in so many programs, but maybe they participate only in a fraction of those.

Bridget: So this idea about there is loyalty program fatigue.

Jacek: Yeah.

Bridget: How does True Loyalty’s architecture use fun things like gamification or micro-interactions to keep engagement high without annoying the end consumer?

Jacek: Yeah.

Jacek: Just pulling something out of the hat here on the customer side, because I think it’s the best to talk about a client, right?

Jacek: So first of all, I think it starts, this one is interesting.

Jacek: I think it really starts with having the right partner on the other side that’s thinking innovatively, right?

Jacek: Like the brands that have these credible teams that are given the capability and the freedom to obviously innovate is absolutely important, right?

Jacek: Because that’s where we see the best results in general, right?

Jacek: We roll in with the tech and some of the consulting, but the innovation starts on the customer side, right?

Jacek: And so there’s a client called Millenio in Mexico, Punto’s Millenio, and one of the leads there, Juan, he came up with this brilliant idea that said, look, we’re in the essentially new space, news and media.

Jacek: I mean, we’re not talking consumer stuff right now at all.

Jacek: This isn’t there producing hair sprays and stuff like that.

Jacek: Look, what do we do?

Jacek: We provide news, we have a news site, we have a media outlet.

Jacek: How do we create more meaningful engagement on our website, on our channels, for our partners, these kinds of things.

Jacek: And so he came up with this idea that said, look, when you really break it down, if we had a flexible gamification reward system, then I think I can get people to scroll a little bit longer on the article.

Jacek: I can get people to spend a bit more time over here.

Jacek: So I can get them to view content that maybe our partners are publishing on our website.

Jacek: So he took the entire view and said, look, this isn’t a loyalty program per se.

Jacek: We have a news media site.

Jacek: We need to gamify this for our consumers.

Jacek: So when you’re scrolling, you get rewarded for reading articles.

Jacek: When you watch videos, you get rewarded.

Jacek: So it created this cool gamification process, and it’s been wildly successful.

Jacek: I’m talking almost 100 percent more time per article.

Jacek: So all of these metrics that are meaningful for the news media space, again, very different than FurBuddy’s or Batiste and these consumer brands.

Jacek: So I think that’s like one example of, I wouldn’t say what we came up with, where we found a partner or a partner found us that said, look, I need a flexible rewards system.

Jacek: And that was one of the legs of our school.

Jacek: So his journey started from the flexible rewards system.

Jacek: It didn’t start from, I need a brand community.

Jacek: I don’t need to necessarily generate social media content.

Jacek: I need that flexibility.

Jacek: And that was our engines.

Jacek: And he plugged that onto the website, it’s live today.

Jacek: And they’re just getting incredible results.

Jacek: So I just think it’s such a fascinating story because it’s not a program.

Jacek: They’re using gamification and sort of engagement.

Jacek: The same psychology that you would view in these programs, Andrew communities, but for the purposes of getting readers to read more, to share articles, to listen to podcasts, you know, that’s what drives their business.

Jacek: And so I just thought it was like a fantastic kind of use case at Millennial, right?

Bridget: Yeah, and again, what I really am enjoying about this conversation, and for the benefit of our listeners, we’ve now talked about Purina, Hero, Arm and Hammer, and Millennial.

Bridget: And you and your team have taken an entirely different approach with each of these because of the problems they are solving.

Bridget: There’s no one-size-fits-all.

Bridget: Let’s go throw a template over this.

Bridget: You all really roll your sleeves up, work to understand what they need to solve, or maybe they don’t know and you’re helping them understand what they need to solve, and you create the programs and the results then speak for themselves.

Bridget: So thank you.

Bridget: That’s just been a really wonderful, broad, yet detailed set of examples for our listeners that I think benefit greatly from your sharing this.

Bridget: And so as we kind of get into wrapping up the conversation, we talked about it a bit at the outset, and you talked about your finance background, your PE background.

Bridget: You know, I’ve worked for a PE-owned company, so I do know it is all about the return and yesterday is better than today to make it happen.

Bridget: But you know, you touched on a few metrics at the outset though, but you know, as you are working with your client, your team is working with the clients, you know, what are you encouraging them to be looking at as the right metrics to measure, and to make their business cases internally for that much, much desired money that’s distributed or allocated in a yearly format?

Jacek: Yeah, yeah, no, it’s a great question.

Jacek: I mean, I think, you know, it’s each business has their own KPIs.

Jacek: You know, I wouldn’t pretend to say that we have like the crystal ball.

Jacek: I mean, each brand obviously knows the KPIs they need to move board level down, right?

Jacek: And that matriculates in marketing and typically, which typically where loyalty would sit, not always, but most of the time.

Jacek: And you know, there’s metrics there, the typical, again, if you just read any book or go to a ChatGPT ask like the top five metrics of a loyalty program.

Jacek: I mean, it’s all there, you know, the AOVs, the pieces there.

Jacek: But I think the critical piece that is missing, that I don’t think is talked about enough, the area that we are specializing in, and I think we’re going to be doing more and more of this, is this concept of incrementality.

Jacek: So it’s this, you know, some people called it lift.

Jacek: But if you’re setting something up and putting a bunch of investment into place, you need a way to demonstrate and be sure that it’s providing incrementality.

Jacek: So, you know, in the absence of it, would it happen anyways, right?

Jacek: And I see that constantly where it’s like, look, you guys are essentially eating your margin, incentivizing behaviors that would already happen.

Jacek: And it happens a lot with, again, some even large loyalty programs where they’ve got their best customers.

Jacek: They’re throwing margin at their best customers.

Jacek: And reality is, guys, they’re already with you.

Jacek: They’re already going to do the majority of the things you want them to do.

Jacek: You don’t need to do that.

Jacek: And again, just a simple example, but it’s just this concept of trying to understand, is the machine that you’re purchasing, the program you’re setting up, however you describe it.

Jacek: I mean, I sometimes describe loyalty as like an engine for business growth, right?

Jacek: It could give you lots of different things, but is it going to provide incrementality?

Jacek: And like, so there’s reporting, there’s the AI prediction conversations, but you need to have a system.

Jacek: I would ask, give me an idea of how you guys can prove incrementality.

Jacek: And what is it that we need to do to combine with what you need to do?

Jacek: And together, we can do that.

Jacek: I think that’s kind of the holy grail.

Jacek: In fact, I think people have been searching to solve the attribution problem for a long, long time.

Jacek: And I think the excuse is really hard.

Jacek: I just think like, it doesn’t make sense to me.

Jacek: Like hard, hard can be solved and we’re sort of here to solve that problem.

Jacek: I mean, that’s one of the main problems.

Jacek: But I think it’s really at the core of what, if I’m a CEO, that’s what I want to hear.

Jacek: Okay, good.

Jacek: So this is going to generate 10% lift on this invested capital and our customers will love us.

Jacek: Great.

Jacek: Like, you know, no brainer, next item on the docket, right?

Bridget: So as we think about what you just said about incrementality and you mentioned AI, you know, how is AI certainly in your business with predictive churn, which is a service that you offer, and then personalization, you know, what are you seeing in those tools enabling better retention for your clients?

Jacek: Yeah.

Jacek: I’m going to probably take a little bit of contrarian view on this one, but I’ll probably start there.

Jacek: We can kind of work our way back.

Jacek: So I think generally, I mean, AI is sort of on the headline everywhere now these days.

Jacek: I mean, it’s on all channels all the time.

Jacek: There’s something tied to AI.

Jacek: So I think, you know, if you peel away the AI buzz, let’s call it, what are we really, really talking about?

Jacek: I think the places where AI is really helping and really helping marketers and retention managers and brand managers is definitely personal personalization.

Jacek: And so, you know, just the ability.

Jacek: And it starts with simple stuff like an email, right?

Jacek: Let’s talk about email.

Jacek: So it’s 10 years ago, if you told me that you could take like the entire internet, put it in a machine and it could spit out a email just for that person at that moment, I call it crazy, right?

Jacek: It was sort of a dream.

Jacek: But reality is like small, medium, large companies can do that now.

Jacek: And so I think it’s really help, it’s helping that side of it, assuming you have all the data you need about your customer, which again, creates a lot better engagement.

Jacek: It gives you the right, you get them at the right moment that it’s valuable, right?

Jacek: What you said earlier, you don’t want to waste people’s time.

Jacek: We’re all busy.

Jacek: So you want to reach them at the right moment.

Jacek: It’s a valuable moment, not just something that is really creating like an annoyance in a lot of ways.

Jacek: So I think personalization was a key piece.

Jacek: I think the other side that hasn’t been solved yet, but it’s an emerging area, is what I call brand discovery.

Jacek: So I think as more and more discovery happens with AI, meaning there’s a generational aspect to it.

Jacek: My teenage teenagers are using Search differently than I would use Search.

Jacek: We’re all sort of evolving at our own pace, but as the surface moves to AI search, I think you need to meet your customer there.

Jacek: So brands need to really understand how they’re gonna solve product discovery right there.

Jacek: And there’s actually a whole space emerging in that.

Jacek: And we wanna make sure that there’s the loyalty side of it’s covered.

Jacek: So I think the…

Jacek: I wouldn’t say it’s solving the retention piece as much as it’s…

Jacek: AI I think is really important for personalization, which you could argue is important to running good retention programs.

Jacek: But I wouldn’t say that there’s anything crazy innovative.

Jacek: I think it was already really good.

Jacek: AI’s just made it more scalable, in my opinion.

Jacek: But really the discovery piece where the consumer is moving is really, really interesting for me.

Jacek: It’s interesting for us.

Jacek: We’re studying that area because at some point in the future, not like two years from now, there’s going to be more and more discovery there on top of going to stores and retail.

Jacek: So again, it’s an evolving space.

Jacek: But that’s the way I would call, talk about the role of AI.

Jacek: I think the data, AI, number crunching, I don’t think there’s a lot of innovation there, in my opinion.

Jacek: We have AI, churn prediction, those things.

Jacek: But those are essentially old techniques, machine learning.

Jacek: I had machine learning when I was in college.

Jacek: They’re just repackaged in a better, more scalable way, but it’s not necessarily a new technique.

Jacek: I think it’s about scale.

Jacek: Again, on CPG and brand, definitely this whole discovery space, super interesting, very interesting.

Bridget: Yeah.

Bridget: To me, I think consumers are going to be increasingly intolerant if you’re not making it personal for them.

Bridget: I mean, I still don’t think enough brands are doing enough or doing it well enough.

Bridget: Now with greater tools, there’s an increasingly less excuse not to be doing it.

Jacek: Yeah, I agree.

Bridget: My humble view of this.

Bridget: Any thoughts on how with AI and brand discovery, could there be involving definitions of what a high value customer really is to a brand?

Jacek: Well, I mean, there’s a whole series of things there.

Jacek: I mean, I think it could be.

Jacek: I mean, I think it’s really so where I see the market today is that because most companies treat the brick and mortar outside of online, they’re kind of separate motes.

Jacek: You just have like a fundamental issue.

Jacek: So like you got to bring it together.

Jacek: So you actually understand where they started, where they’re going, all that kind of stuff.

Jacek: What’s an actual high value customer?

Jacek: Because if you don’t see both sides and most brands that we deal with are on both sides, we don’t necessarily specialize in only online, right?

Jacek: We specialize in this Omni channel.

Jacek: It is you got to bring it together and then you start to understand, okay, so what is a high value customer?

Jacek: And I think it may not be what they think it is, right?

Jacek: So once they understand the behavior, once they understand that they can get a whole pile of them into a brand owned community, maybe referrals or reviews or content is much more powerful than creating a tier program with some sort of earn and burn point system.

Jacek: I think the biggest issue right now is that most companies, a lot of brands, this is I think our opportunity and others, is just around educating the market that there’s different ways to solve this issue and looking at it more broadly, more globally, right?

Jacek: So it’s not just this little retention tool, it’s a customer lifecycle kind of situation.

Jacek: And then you start to talk about, okay, well, wow, our definition of a high-value customer totally changed.

Jacek: You know, it used to be that it was the, you know, how many points they had, VIP, how many seats we sold on the airlines.

Jacek: I mean, you come from the airline industry.

Jacek: So I just think it’s the person that invites, I’ll give you another example, somebody that invites a friend to a special sample of a product at a brand and they get excited.

Jacek: And then, like, that is a pretty strong signal about that person’s affinity to your brand.

Jacek: Versus just, you know, they bought some things, or, you know, transacted, things like that.

Jacek: I mean, they went out on a limb, so to speak, and they kind of sent it to their personal network.

Jacek: You know, they’re sort of vouching for the brand.

Jacek: That’s right, that’s a huge signal.

Jacek: And I just don’t think there’s a great way to measure it up until, like, we think we have a great way to measure it, but I don’t think it’s been a focus area where all these other pieces are key.

Jacek: And high-value customers may not be what you think they are if you’re looking at loyalty in the traditional sense, right?

Bridget: Agreed, agreed.

Bridget: And much like, you know, you’ve got to get on your personalization game, you’ve got to keep on your measurement of what is valued for your brand.

Bridget: Okay, so I’m going to put you on the spot a little bit about the future here.

Bridget: As you look out over the next few years of True Loyal’s trajectory, which I’m very bullish on, what is the single biggest misconception about customer loyalty that True Loyal plans to dismantle?

Jacek: Yeah.

Jacek: I mean, I could go on, I could do short, medium, long, but I would say I think the biggest misconception is that a loyalty program creates loyalty.

Jacek: So, I mean, it’s kind of like, if somebody has bought from the same brand for 20 years, then they open an email and they get like $3 off a thing.

Jacek: I mean, is that, that’s not loyalty, right?

Jacek: I mean, but I think there’s a whole generation of marketers that have been trained, that’s like, okay, if you buy a loyalty program, loyalty just comes out the other end.

Jacek: You just like put stuff in and like loyalty shoots out.

Jacek: And I just think just fundamentally, that’s really not what is happening.

Jacek: I think like, you know, most programs, for example, they hand discounts to consumers that are already walking to the register, right?

Jacek: So nothing’s changed about the decision.

Jacek: I mean, except, except what’s changed is you’re like underwriting, you’re paying for that.

Jacek: So I think this whole concept of, if they’re going to do it anyways, right?

Jacek: That’s not like, you’re not adding to it.

Jacek: And so I just think that the measurement has been a little bit overly indexed on points earned, enrollment, points burned, right?

Jacek: None of that stuff like tells you if one person chose something over something cheaper, for example.

Jacek: So I just talk to companies all the time and it’s, and they all are struggling with this space.

Jacek: I would argue that the heritage, let’s call it heritage brands, maybe that weren’t direct to consumer, maybe that they’ve been selling through retailers.

Jacek: There’s this tension that’s occurring now between like on shelf and these heritage brands that want to get, they sort of want to get access directly to their consumers.

Jacek: I just think the measurement is not just points issued, points burned, right?

Jacek: So I think it’s important that you’ve got to have a bigger view than that, and again, it goes back to incrementality.

Jacek: So I just, to me, I don’t know if it’s the school of loyalty.

Jacek: Again, I’m not a loyalty person, I’m a consumer.

Jacek: I’m not a loyalty expert by background, but I just think for years and years and years, it’s been on like enrollments, points issued, points burned.

Jacek: It’s like missing the entire script.

Jacek: Like the engine needs to be there to provide actual lift, not to what people were going to do anyways.

Jacek: That’s where I see our wedge coming in, where I want to give people tools and that proof.

Jacek: I mentioned the proof before, so the two sides.

Jacek: They got the tools, APIs, the tech and all that stuff.

Jacek: Great.

Jacek: But then there needs to be a mechanism that the business understands that they’re generating incrementality lift.

Jacek: They could send it around.

Jacek: They can justify a business case, justify a reinvestment, things like that.

Jacek: And I think those two pieces are probably where we’re going to be, again, focusing on the future.

Jacek: So again, just better versions of the tools and more capability to provide insights on the incrementality.

Bridget: So Jacek, thank you.

Bridget: We certainly have covered a lot here in our brief time together.

Bridget: You shared generously with our listeners.

Bridget: There is a really a wealth of information also on your website that I certainly encourage the listeners to go and learn from.

Bridget: Is there anything else though as we wrap up our conversation that you would like to share?

Jacek: No, I mean, first of all, just thanks for having me.

Jacek: It’s such a great topic.

Jacek: I mean, I think we’re in this kind of, next few years, this whole space is going to be just super exciting.

Jacek: I’m excited about it.

Jacek: I will say a couple of areas that I think that I would say suggest people to watch.

Jacek: You know, if you’re doing research, you’re studying stuff, I would say two areas.

Jacek: One, I would definitely continue to keep an eye on the AI space.

Jacek: So sort of this world of clicks, as I call it.

Jacek: So imagine for a minute a world where some of your consumers are not actually the people that are transacting with your brand, right?

Jacek: So there’s this whole kind of concept where, you know, agents are doing shopping for you, discovery for you, all these kinds of things.

Jacek: What does it mean when a piece of software is discovering or reading about your products?

Jacek: They don’t have brand affinity.

Jacek: They’re not even a human, right?

Jacek: So I just think this whole area of what does it mean for agents to be doing discovery and transactions of your products mean for the concept of loyalty?

Jacek: I don’t really have that answer.

Jacek: I’m just saying that it’s an evolving space.

Jacek: It’ll be very interesting to see the adoption rates and understand how companies that are using loyalty as a tool, to build brand affinity.

Jacek: How do we deal with that?

Jacek: I don’t know where we go.

Jacek: I know it’s going to evolve.

Jacek: But again, to me, it’s just really, really interesting because it’s just going to change to be the world of clicks in a big way for consumers.

Jacek: And then on the world of bricks, so brick and mortar, I would say, and I just put out a video on my LinkedIn about this, I think there’s this emerging hot developing tension between retail shelf and heritage brands that want to go digital, meaning the companies that have not a lot of data about their consumers have to work with retailers that own the shelf, that are distribution, and they might know more about their consumers than the brands themselves.

Jacek: And then those retailers are, for example, building their own private labels.

Bridget: So Jacek, I have just one more question for you.

Bridget: Where best for our listeners to get in touch with you?

Bridget: LinkedIn?

Jacek: Yeah, LinkedIn is great.

Jacek: Drop me a DM.

Jacek: I’m also on X as well, but those would be the two.

Bridget: Okay, great.

Bridget: Well, again, thanks again.

Bridget: It’s been a terrific session, one of my favorites.

Bridget: And, you know, looking forward to see where TrueLoyal takes all this in the future.

Jacek: Yeah, I appreciate it.

Jacek: Really fun.

Bridget: Thank you, Jacek.

Jacek: Bye now.

Jacek: Bye, guys.

Bridget: Bye-bye.

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