Charting the evolution of loyalty

Zurich | Switzerland 19th March 2020

Gabi Kool, chief commercial officer of Loylogic, platinum sponsor of the Loyalty Magazine Awards, explains how loyalty is evolving and why.

Loyalty Magazine: The milestones section of the Loylogic website lists the company’s achievements over the past 15 years. It also gives a fascinating picture of the evolution of loyalty itself. Can you explain that path? 

Gabi Kool:
Loylogic was founded in 2005 by Dominic Hofer, and you are right, its path since then shows a fascinating picture of how loyalty has evolved. Etihad was our first airline frequent flyer programme client and for this Loylogic created its first market place for loyalty. From the start it was considered that a marketplace set up was the best solution for airlines and travel. We introduced a slider, so that people could pay with a mix of cash and points. This facility has become more widespread, but it was very new at the time. From there the company spread into other industries and we now have divisions for loyalty operations in the airline business, in hospitality, FMCG, payment, telco and digital health.

You can easily see that since the early beginnings our vision was to bring more choice to loyalty programs and their members. With choice as our guiding principle we are constantly innovating and venturing beyond current loyalty needs. This naturally leads us to new loyalty territory and industry discoveries. We have created many patents and won 26 awards for our partners and we are proud to show much more of this in future.

Do you operate within each of these verticals separately, or are there cross-overs?

Both. We have specific teams that concentrate on a certain vertical, enabling them to leverage their expertise, but at the same time there are a number of disciplines that cut across those and these teams are able to introduce best value for the client regardless of sector. For example, knowing how to address an abandoned cart in the ecommerce reward stores via retargeting is something most clients need help with. We also find that most companies need our experience in setting up and running an ecommerce site too, so we maintain a best practice hybrid structure.

Are any sectors growing particularly fast?

Loyalty as a whole is growing at a rate of 22% a year, with thousands of companies launching new programmes. As a company, we are experiencing particularly strong growth in FMCG (CPG) as brands are directing more funds and focus to customer loyalty initiatives as a result of the decline in traditional advertising effectiveness, and in health and well-being programmes. We are particularly proud of our role in the Aon Well One programme which encourages employees to adopt a sustainable and healthy lifestyle by rewarding them with points they can spend with leading brands in the reward store.

Explain how a market place works in loyalty?

Loylogic has always recognised the benefit of bringing merchants and loyalty programmes together and mixing and matching sellers and buyers. For example through one of our solutions, Pointspay, we enable a consumer who belongs to a loyalty programme, for example a frequent flyer programme or a credit card loyalty scheme, to use their points, or a mixture of points and cash, directly at popular online shops.  By choosing the Pointspay button as a payment option directly at the merchant‘s checkout page, the consumer can pay with their loyalty points or collect more of the linked loyalty program’s points when spending cash. This works for the loyalty programme, because it re-enforces the value proposition to the member, while the merchant benefits because it attracts a totally new customer base of affluent loyalty members.  In this way the redemption choices of a loyalty programme need no longer to be limited.

Loylogic supports two loyalty models. Can you explain how they work?

Pointshub gives programme members an abundance of choice in how to spend or collect more points and enables programme managers to implement flexible and smart strategies like for example cost per point (CPP) optimisation. It is our multi-award-winning e-commerce platform including our patented points-plus-cash application (and offering an unmatched variety of points earn and burn solutions). Pointshub also contains our complete points retailing suite of buy, gift, transfer, boost, extend or reinstate miles or points, with more innovative modules to be launched in 2020. All our turnkey Pointshub solutions, are ready to be integrated at multiple program touchpoints. We provide the seamless web and mobile processes as well as payment clearing. 

Pointspay, as mentioned above, is our highly innovative e-payment platform with its own fast-growing proprietary merchant network. It directly connects loyalty programs to famous brands by letting members use  their points (or miles) in leading online shops as well as in-store merchants worldwide. This we see as the future for loyalty. Growth is accelerating and we expect this to continue. Pointspay is powerful because it enables multiple payment options encouraging the collect and spend flywheel and offers simple integration on the program and merchants’ side. 

So it is about more than just aggregated payment options?

It empowers loyalty program members to seamlessly shop with their points or miles directly at the participating merchant’s online shop and even in store via a personal virtual or physical Reward Card. This card can be loaded with points instantly online or via phone through the specifically created Reward Card app. Those loaded points then transform in to cash on the card of many different currencies. On the online merchant’s side the Pointspay button provides a unique triple checkout possibility, letting the loyalty program member collect or redeem their loyalty currency, or to pay using a combination of points and cash. Members will even earn points back on the cash component spent. Pointspay delivers value to all stakeholders in the ecosystem. 

How big is Loylogic?

We employ 140 people and operate across the world. Geographically, we are particularly active in the Middle East, Europe and Asia. We have a strong focus for 2020 on building our US business. We operate rewards earn and burn initiatives in 170 countries. This can be challenging because there are different rules in various countries, especially around sweepstakes, raffles and gamification and we pride ourselves in assisting and finding ways to make it possible for our partners. Loylogic is an extremely active company that is constantly looking at trends across the whole ecosystem. We like to grow with our clients.

So how would you describe Loylogic in a sentence?

A definition of the company would be that Loylogic caters to both present and future needs in delivering powerful solutions which amplify engagement and build long-term loyalty.

You have recently joined the company Gabi. Why did you make the move, and what would you like to achieve?

Founder Dominic Hofer and I have known each other for at least ten years. Over that time, I have been working on the other side of the aisle, as a loyalty programme owner, shareholder and operator. I also have experience of how agencies fit in. My previous project no longer needed day to day input, and so the timing was right. I liked that Dominic is always pushing innovations, and felt I could help in enabling and supporting the very fast growth of the company.

What elements of the business are you going to be involved with?

As CCO I will look after new business sales, the account management teams, program performance, marketing and the ecommerce teams. There is plenty to do and it is a great partnership. I think that Dominic and I really complement each other well.

Why should a loyalty programme operator or a merchant choose Loylogic?

We are providing a whole different level of technology solutions to help members collect or spend on a wide range of innovative opportunities. We do not just focus on goods but offer literally anything for points a member or consumer nowadays could look for. I don’t think there is any other company in the world that has the same level of global solutions and content offering.

Why has Loylogic chosen to be a major sponsor of The Loyalty Magazine Awards?

We have always been active in conferences and in loyalty related media. Having been in the industry for a number of years, we have seen which are managed best. We share a deep passion with Loyalty Magazine to build and grow the loyalty business. Together we see ourselves as custodians of the loyalty industry. We want loyalty marketing to further develop its importance as part of the commercial strategies of leading brands in travel, FMCG, Digital Health and Financial Services and we feel that both Loylogic and Loyalty Magazine play an important role in that. Loyalty Magazine and the Loyalty Awards are a great example of a very well-run media operation with a great selection of entrants and attendees that cuts across all industry verticals and geographies. The audience they attract fits very well with the global profiles of organisations we would like to partner with. 

Read on Loyalty Magazine: https://www.loyaltymagazine.com/charting-the-evolution-of-loyalty