Latest / Leaders in Customer Loyalty, Powered by Loyalty360 / #389: Giant Food: Enhancing the Customer Experience by Leveraging a Powerful Digital Loyalty Program and Prioritizing Personalization

Transcript

#389: Giant Food: Enhancing the Customer Experience by Leveraging a Powerful Digital Loyalty Program and Prioritizing Personalization · Leaders in Customer Loyalty, Powered by Loyalty360

• 0:02
  Speaker 1: Driving customer loyalty can be a difficult task in the best economic times.
• 0:06
  Speaker 1: As we continue through 2024, we all know there are some economic headwinds that are impacting a significant number of customers in a varying way.
• 0:15
  Speaker 1: One of the industries that is being most impacted is grocery, as customers continue to look for value and many grocers are looking to increase their assortment of private label brands store brands to bring value to their customers as well as to their bottom line.
• 0:32
  Speaker 1: There are challenges and opportunities in doing so navigating it and educating the customers to the value, but also working with the CPG companies as well.
• 0:41
  Speaker 1: These challenges are being deftly handled by Ryan Drotty, who is the head of loyalty at Giant Food.
• 0:49
  Speaker 1: The award-winning Giant Flexible Reward Program is a program that he configured and runs.
• 0:54
  Speaker 1: Ryan's going to talk to us about some of the things that he's seeing within the grocery industry and how he's addressing them.
• 1:01
  Speaker 1: Ryan is working diligently to keep his brand top of mind in the uber competitive grocery industry, as there are some challenges where they may be seeing some shift share to upstarts such as Aldi and the stalwarts such as Walmart.
• 1:17
  Speaker 1: He's looking to increase the value equation of his program.
• 1:19
  Speaker 1: Ryan also is going to be discussing today the need to educate the internal and external stakeholders as to the value of the program and how that is evolving and how he is managing that.
• 1:29
  Speaker 1: There also are challenges in customer loyalty right now, as we know, with regard to fraud.
• 1:34
  Speaker 1: There is a growing number and type of fraud, but many brands still use manual processes to address them.
• 1:41
  Speaker 1: So Ryan is going to talk about how he addresses them.
• 1:45
  Speaker 1: He actually gave an amazing presentation at the 2024 Loyalty Expo where he discussed all types of fraud he's seen in his career, which includes hospitality as well as grocery, and also.
• 1:56
  Speaker 1: The last thing that Brian's going to focus on is emotional loyalty how they look at emotional loyalty within their organization and how they use the Guiding Stars program as part of the reward program itself to drive emotional loyalty.
• 2:11
  Speaker 1: So, ryan, a lot going on.
• 2:14
  Speaker 1: Thank you very much for taking the time to join us today.
• 2:16
  Speaker 1: How are you?
• 2:17
  Speaker 2: Hey, mark, good morning.
• 2:17
  Speaker 1: Good to see you again.
• 2:18
  Speaker 1: Nice to see you, as always.
• 2:20
  Speaker 1: First off, we'd like to start these on a little more personal level, so we'd love to know a little bit more about your experience in customer loyalty and what your role at Giant Food is, and also maybe a fun fact or a passion you have outside of loyalty.
• 2:34
  Speaker 2: Yeah, no problem, and again thank you for having us here today.
• 2:37
  Speaker 2: So my background in loyalty goes back quite a while.
• 2:40
  Speaker 2: I've been in the loyalty space for a good 20 years or so.
• 2:44
  Speaker 2: I really found a passion for it when I was in business school at Georgetown and I took a class on analytical marketing and to me it was just this nirvana moment of wow you can do marketing.
• 2:54
  Speaker 2: But it's not just the fluffy stuff you know, but actually tied to analytics and the metrics, and to me that was just kind of the right brain and the left brain coming together.
• 3:02
  Speaker 2: And after that point I knew what I wanted to do with the rest of my career and so I was lucky to have loyalty leadership roles in hospitality, retail, financial services and now here in the grocery world.
• 3:13
  Speaker 2: So I'm the head of Omnichannel Loyalty at Giant Food, giant's part of Ajo Delhaize.
• 3:18
  Speaker 2: For those who may not be familiar, ajo Delhaize is the global grocery conglomerate based out of the Netherlands and they have five brands here in the United States on the Eastern Seaboard.
• 3:28
  Speaker 2: Giant is in the Mid-Atlantic area.
• 3:30
  Speaker 2: We have 165 stores here in Delaware, maryland, virginia and DC and we are the market leader in our area.
• 3:38
  Speaker 2: So my role is really fostering simply around long-term relationships with our brand through our program that seeks to build incremental grocery sales and retain our shoppers over time.
• 3:47
  Speaker 2: So that's a little background about me.
• 3:50
  Speaker 2: Fun fact well, one thing I think is pretty cool I have a patent that I earned about 20 years ago that was building the analytical model for estimating real college costs for aspiring students that were looking to go into secondary education.
• 4:06
  Speaker 2: I worked at Sallie Mae at the time and folks were struggling with how to afford college and I was looking at the mortgage model and said, well, why don't we try to do what they do in the mortgage model to help people figure out what they can afford, and do that for colleges as well?
• 4:17
  Speaker 2: So we took real college costs, built this model, projected it over how many years you're going to be in school and it could tell folks, before they ever signed the first promissory note, of what their estimated monthly cost was going to be, based upon what mom and dad were going to do, scholarships and the cost of getting a loan.
• 4:32
  Speaker 2: The one thing I wish was I quit at the moment and taken that and gone private, because then I'd be sitting on an island somewhere.
• 4:40
  Speaker 2: But unfortunately the patent is with Sally Mae, although I do have a nice plaque at home from the patent office that has my name on it.
• 4:49
  Speaker 1: That's very good that you know that.
• 4:50
  Speaker 1: All things I know about you didn't know that.
• 4:52
  Speaker 2: So that's pretty good, for sure.
• 4:53
  Speaker 1: Thanks, or some outcomes of that, anything unique that if you're going to say it was for teaching or just for no, no, no.
• 5:02
  Speaker 2: This was for students and parents.
• 5:04
  Speaker 2: So we were trying to figure out OK, you know I'm going to.
• 5:06
  Speaker 2: You know where do I put my kid to school?
• 5:08
  Speaker 2: Like.
• 5:08
  Speaker 2: It's such an emotional decision, mark.
• 5:10
  Speaker 2: You know that parents just want their kid to get into school and you're putting a promissory note to sign in front of an 18 year old, you know, for thousands upon thousands of dollars.
• 5:19
  Speaker 2: And so for four years they have no idea what they're signing.
• 5:22
  Speaker 2: And then, six months after graduation, this bill from Sally Mays in the mailbox.
• 5:25
  Speaker 2: They open it up and they say, oh my God, I can't afford to pay this.
• 5:28
  Speaker 2: And so if you could go back in time and rewind it to that, before they ever signed that first promissory note, and you can project everything out and say, okay, if you estimate all the lending that you're going to need, with all the other elements considered, this is what your payment's going to look like.
• 5:42
  Speaker 2: Would that influence where you might go to school or what type of major you might have?
• 5:47
  Speaker 2: And the whole idea of empowering families with information before they get themselves into trouble.
• 5:52
  Speaker 2: And I got to tell you the impact of seeing it in focus groups and watching people go through it and being like, oh my God.
• 5:59
  Speaker 2: The goal wasn't to turn them off, but just to make sure that they know what they're getting into.
• 6:04
  Speaker 2: So by the time that that bill does come, they know what to expect.
• 6:08
  Speaker 2: You know, and that had a big impact, I think, on folks' relationship with us as a lender.
• 6:13
  Speaker 2: As a lender, customers hate you.
• 6:15
  Speaker 2: It's a tough business to be in from a net promoter score perspective.
• 6:21
  Speaker 2: But our goal was you may not like us, but you'll respect us for giving you that information.
• 6:25
  Speaker 1: Excellent.
• 6:25
  Speaker 1: But our goal was you may not like us but you'll respect us for giving you that information Excellent.
• 6:26
  Speaker 1: Well, it's good to know.
• 6:26
  Speaker 1: Well, you also have kind of spun up and developed and enhanced one of the better, if not the best, grocery loyalty program in the country.
• 6:36
  Speaker 1: Award winning, the Giant Flexible Reward Program Great program.
• 6:40
  Speaker 1: Can you talk a little bit more about how it works, how you've enhanced it and kind of what the benefits for consumers who are part of the program, what those are?
• 6:51
  Speaker 2: Yeah, no, thank you for the accolades, and you know my competitors are getting very good in this space.
• 6:56
  Speaker 2: So there's a lot of great grocery programs out there, but Flexible Rewards started back in March of 2020.
• 7:02
  Speaker 2: We launched the same week that COVID effectively came out, so it was a tough time to go into the market.
• 7:08
  Speaker 2: But the whole idea was to take our offline grocery program, which had been around for Giant since 2000, and move it to a digital-led program.
• 7:18
  Speaker 2: This idea that if you signed up online or through the app, that you would have access to benefits that you never had before and the opportunity was to be able to reach folks 24-7 with personalized offers and that's really the hallmark of any good grocery program is, you know, we know so much about how you purchase that we can give you offers of what we think that you need, you know or are going to buy truly on a daily basis.
• 7:45
  Speaker 2: So the idea of being able to push those personalized offers to customers, to give them the membership pricing that they always receive, but then also to introduce a new point-based currency that could allow them to earn and redeem in our stores for things like gasoline through Shell fuel stations, grocery savings in our store or online, now that we're an omni-channel retailer, or my favorite that they can redeem them for free private brand items like a gallon of milk, a dozen eggs or even a rotisserie chicken.
• 8:15
  Speaker 2: We launched that about two years ago as the recession, the inflation aspects were really hitting hard and we priced it at a level that was very cheap.
• 8:25
  Speaker 2: So 100 points, for example, could get you a dollar off groceries, or 100 points could get you a gallon of milk, and so a gallon of milk was retailing for $3.99.
• 8:34
  Speaker 2: So you can see how critical and how valuable that was for customers.
• 8:38
  Speaker 2: For us, it's great because, even if they have a fraction of points every week when they're thinking about where to shop, our goal was that they would say you know what?
• 8:46
  Speaker 2: At least I know, if I go to Giant, I'm going to get my milk for free, I'm going to get my eggs for free, and how powerful that can be when folks really do trade off between many different retailers on a weekly basis of where they shop.
• 8:57
  Speaker 2: So investments like that have really paid off for us and, at the end of the day, we really want to grow a digital relationship to reach our customers with those offers, but also to allow the offline customers to benefit from member pricing and other promotions as well.
• 9:10
  Speaker 2: Excellent.
• 9:12
  Speaker 1: Having the right offer, the right incentive is very important for a customer, as you just talked about, and being able to design that in the program is quite challenging sometimes and you mentioned you guys do a really solid job of doing that.
• 9:27
  Speaker 1: You're developing emotional relations with your customers because food as you know, you're feeding your family has a very emotive kind of perspective to it, especially when things can be a little more expensive than they may have been over the past couple of years.
• 9:40
  Speaker 1: So when you look at emotional loyalty and how you try to drive that at Giant Food, you know how are you doing that.
• 9:47
  Speaker 1: How are you looking at developing, maybe using guidance stars or being able to get free milk or the pharmacy reward program?
• 9:54
  Speaker 1: You know how are you developing this great vision, great program to drive that emotional attachment?
• 10:01
  Speaker 2: Yeah, you know, I'm glad you talk about emotional loyalty.
• 10:04
  Speaker 2: It's something that at your conference, the Loyalty360 conference, or the expo that recently, was one of, I think, the main topics there.
• 10:11
  Speaker 2: You know, we talked about AI, we talked about personalization, but emotional loyalty was something that was on a lot of people's minds of you know how do you do it.
• 10:19
  Speaker 2: You know and it sounds great, but how do you actually execute it?
• 10:22
  Speaker 2: And you know, for those folks listening, emotional loyalty is this idea that they identify with your brand, they're proud of doing business with you, they genuinely like you.
• 10:32
  Speaker 2: It's above and beyond a transactional relationship.
• 10:35
  Speaker 2: So, you know, even if another competitor opens a half a mile closer, or you know the price of something goes up, or even if they you know an employee irks you at the store, you're still with them.
• 10:45
  Speaker 2: You know and you're still connected to them.
• 10:46
  Speaker 2: You know and how powerful that is, but how challenging it can be for a lot of brands, especially something as transactional or commoditized as a grocery store.
• 10:54
  Speaker 2: You know.
• 10:55
  Speaker 2: So for us, you know we looked at, okay, you know what are things that are above and beyond that transactional relationship that we can relate to with our customers and for us, via purchasing food and via having pharmacies, the idea of wellness really jumped out, the idea that we can invest in the wellness of our customers because we can guide them toward purchasing healthier food.
• 11:19
  Speaker 2: We can guide them toward using the pharmacy services for vaccines and prescriptions, guide them toward using the pharmacy services for vaccines and prescriptions, but also checkups and nutritional type elements that they can do with our folks.
• 11:29
  Speaker 2: And so we realized that we own something special within our store.
• 11:33
  Speaker 2: So, to that regard, you know, we started to think of, okay, how do we bring this to life from a loyalty program perspective?
• 11:40
  Speaker 2: And in that regard, we did what I think you know any smart loyalty program does.
• 11:45
  Speaker 2: We don't try to figure it out on our own.
• 11:47
  Speaker 2: We don't think that we're the smartest person in the room.
• 11:49
  Speaker 2: We go out and talk to our customers, you know, and we get that attitudinal feedback, what they think and also look at the data, what they do to help influence where we should make the investments.
• 12:00
  Speaker 2: And I'll admit, mark, the biggest mistakes I've ever made in my career are when I think that I was smarter than the customer, you know, and made decisions that didn't end up being what they really wanted and instead just shutting up and listening to them, you know, and seeing what was important.
• 12:15
  Speaker 2: So what we did, you know, we went on surveys.
• 12:17
  Speaker 2: We talked about, you know, if we did offer rewards on different aspects of the business, what would resonate.
• 12:23
  Speaker 2: And that idea of pharmacy and healthy living really rose to the top.
• 12:26
  Speaker 2: You know, folks were interested in saying, if you can help me be better at these things and actually reward me for it, I'll spend more with you, I will stay with you longer, and that really, at the end of the day, was what we were hoping to achieve.
• 12:39
  Speaker 2: So in that regard, we put together a program that did offer rewards for healthy purchasing, using our guiding stars, which is a health rating program and it creates a metric against each product in our store, so you know how healthy it is.
• 12:52
  Speaker 2: And we started offering a point earned aspect tied to our digital loyalty program.
• 12:57
  Speaker 2: So for us, selfishly, the goal was for folks to upgrade into the digital program or to join the program outright.
• 13:04
  Speaker 2: Folks to upgrade into the digital program or to join the program outright, you know, and in return we're putting our money where our mouth is to say, if you purchase healthier or if you do your wellness business at our pharmacy, we're going to give you points that can, you know, add up and go toward the rewards involved.
• 13:18
  Speaker 2: Above and beyond, we started adding content, nutrition, ways to cook or to find foods better, you know, or to talk about the impact of different vaccines, or how to, you know, be more in charge of wellness.
• 13:31
  Speaker 2: So it wasn't just the loyalty program aspect, but it was this idea of being a trusted advisor, you know, of giving content that really helps people get better and, in that regard, launching that program, which we did back in 22,.
• 13:43
  Speaker 2: We've evolved it ever since and want to continue to do so, because we know this is such an important area to differentiate and, going back to your original point, creating that emotional connection with our customers.
• 13:53
  Speaker 1: When you look at the kind of changing behavior with regard to the Guiding Stars program and eating healthier.
• 13:58
  Speaker 1: Obviously you can look at the products they buy and how they line up and kind of the star attributes they get from it.
• 14:05
  Speaker 1: Can you look at the behavior aspects that they may be more healthy?
• 14:11
  Speaker 1: Is there feedback that you can get that maybe their blood pressure is down, or is that something you could potentially do, because that's always intrigued me, being a health enthusiast myself, you know being able to tie that back to some measurable change in health, because you know America needs that.
• 14:24
  Speaker 1: We're, I think, eighth in the world in obesity right now and even with Ozempic and all the other inhibitors out there continues to go up.
• 14:33
  Speaker 1: Is there a way to tie that back to actual outcomes?
• 14:36
  Speaker 2: Yeah, there are in a couple of ways and I think you made a really good point.
• 14:40
  Speaker 2: You know, the tragedy of the current situation in our country is that food has gotten so expensive and especially healthy food often that I think poor or underprivileged families often turn to fast food or junk food to put food on the table because it's so much cheaper and faster to be able to do than buying high quality produce or meat and actually cooking a nutritious meal.
• 15:01
  Speaker 2: And we take that very personally because we know that's a real issue to lead to the challenges that you mentioned.
• 15:06
  Speaker 2: The good news is that by nature of having a food rating program, there's an analytics aspect to it, that we can look at the basket health score of every customer, which is really cool, you know, because then I can look at the basket health score of every customer, which is really cool, you know, because then I can look at your progress over time to say, okay, mark, on a zero to three basis, started off at a 1.1, looking at his total basket, but now he's moved up to like a 1.7, you know, and we're seeing the progress there.
• 15:32
  Speaker 2: And the good news, excuse me, overall is that we are seeing that progress of folks' health aspect getting better when they have opted into this program.
• 15:42
  Speaker 2: So they are purchasing healthier food, they're making better decisions.
• 15:46
  Speaker 2: The one aspect that I can't necessarily go into is tying your purchases on the food side back to your health, looking at anything that may be covered from, like, a HIPAA or privacy perspective, as there is a very fine wall between marketing and personal health, you know.
• 15:58
  Speaker 2: Looking at anything that may be covered from, like, a HIPAA or privacy perspective, because there is a very fine wall marketing and personal health that we have to be careful of, you know.
• 16:05
  Speaker 2: So I focus on looking at how you're purchasing, you know, and my hypothesis is, if you're purchasing healthier, you're taking this more seriously and hopefully it is influencing things on the other side of that wall.
• 16:17
  Speaker 1: Well, real quick.
• 16:18
  Speaker 1: So obviously certain products are more expensive.
• 16:21
  Speaker 1: But is it a situation where I again I eat very healthy, or try to at least.
• 16:27
  Speaker 1: I do have my donut habit that I like to have Of course, is it more expensive or is it more the time component gets figured into?
• 16:35
  Speaker 1: Because buying some chicken, right, you get a nice thing of chicken for six, seven, get some rice, get some bananas, maybe it's just not.
• 16:41
  Speaker 1: I mean, there's, there's things you do pasta, right, you can eat healthy, but it's work, right.
• 16:46
  Speaker 1: It's not like buying a box of uh cheeses and eating them for five bucks, right, it'll fill you up.
• 16:51
  Speaker 1: But to make the chicken, to boil the chicken, to put some uh flavoring on it, to get the rice, I mean it's just, you can eat, can you eat healthy, but it's just more work.
• 17:00
  Speaker 1: Or is it significantly more expensive to eat the healthier food?
• 17:03
  Speaker 2: I mean, I do think it's aspects of both time and money.
• 17:06
  Speaker 2: I think you make a great point that time is a huge factor in it.
• 17:09
  Speaker 2: You know, and I think unfortunately, some families will just again go to the fast food outlet you know, or just get you know no offense to the brand, but you know hamburger helper or something you know and just put something together quick and say, here you go, you know this can feed.
• 17:23
  Speaker 2: You know the family for the night.
• 17:24
  Speaker 2: You know, as opposed to thinking about kind of more the curation of you know what produce should I get.
• 17:29
  Speaker 2: You know how do I find a balance?
• 17:30
  Speaker 2: You know how are the different food groups being reflected in what we're doing?
• 17:34
  Speaker 2: And that's why it's not just the food offers but it's also the content that goes along with it.
• 17:39
  Speaker 2: And there's a huge opportunity there to guide folks on how to make fast, nutritious meals that aren't going to break the bank.
• 17:48
  Speaker 2: And so I'll readily admit I think we're good on the offer side, we're good on the reward side, but the content side and that guidance aspect, it takes time because you need people writing that and really thinking about that, and the more, of course, you can even personalize.
• 18:00
  Speaker 2: It is a huge opportunity, but it's a big time investment as well.
• 18:05
  Speaker 1: And you mentioned personalization.
• 18:06
  Speaker 1: It's very important for brands these days to truly understand their customers, have as many salient data points as you can have and action on them in the most relevant manner as possible, action on them in the most relevant manner as possible.
• 18:19
  Speaker 1: Giant Foods does a great job with regard to personalization and as part of your customer loyalty efforts, can you speak to that a little bit, what personalization means to Giant and how you actually action on it?
• 18:30
  Speaker 2: Yeah, no problem, yeah, so I mean I'm pretty hard on our efforts here and, I'll be honest, I look at personalization in two different lenses offer and content, kind of like what we were just talking about.
• 18:41
  Speaker 2: So on the offer side, I'll give us an A minus.
• 18:44
  Speaker 2: I think grocers are probably one of the best verticals that can take the ocean of data that they sit on and turn it into a personalized offer strategy.
• 18:54
  Speaker 2: We know what you buy because you're buying with us so often.
• 18:58
  Speaker 2: It's not like a hotel or an airline model where we might see you, you know, three or four times a year.
• 19:02
  Speaker 2: I mean, we're seeing you often two times a week.
• 19:04
  Speaker 2: So the predictability of looking at different food categories and what we want to serve to you is very strong.
• 19:12
  Speaker 2: And so, from an analytics point of view and our ability to develop the algorithms, you know we're really good at being able to personalize what offers come through to you, specifically through email push notifications on our site, and we actually send out over a billion offers a year to our customer base.
• 19:28
  Speaker 2: I mean, to me it just blows my mind to you, a billion offers that we're putting out across 12 months.
• 19:33
  Speaker 2: And that's a really critical factor of the program success to be able to influence shopping trips with us.
• 19:35
  Speaker 2: So that's the offer side and, like I said, that's a really critical factor of the program success to be able to influence shopping trips with us.
• 19:38
  Speaker 2: So that's the offer side and, like I said, that's an A minus the content side.
• 19:42
  Speaker 2: You know I'll say C minus probably, because if you go to our site, if you go to our app, if you go to our store, whether it's you, mark me, you know the lady down the street, you know it doesn't matter, you're getting the same experience.
• 19:55
  Speaker 2: And so, while the offers may be different, the content is the same, the marketing is the same.
• 20:05
  Speaker 2: And that's where I think the huge challenge and opportunity is is that to more personalize what you're seeing in these different channels based upon how you're purchasing, but what type of lifestyle content and guidance may be best for you.
• 20:16
  Speaker 2: The recipes, if we know that you're purchasing vegan or gluten-free, to see that type of content show up.
• 20:23
  Speaker 2: So it's not just the gluten-free product that we're offering, but really tailored more.
• 20:28
  Speaker 2: You know, I like to say our heart, or our app has a soul.
• 20:31
  Speaker 2: You know that it's really in tune with who you are, you know in your lifestyle and the things that are important to you.
• 20:37
  Speaker 2: So there's a lot of opportunity to tailor that.
• 20:40
  Speaker 2: But again, it takes a lot of effort.
• 20:41
  Speaker 2: It's easy to say, oh, we need to build personalized content, but someone or some AI you know method needs to look at these different segments and then regularly pump out this content so it's fresh and it gives you a reason to come back.
• 20:55
  Speaker 2: So again, personalization.
• 20:56
  Speaker 2: You know one area great offers.
• 20:57
  Speaker 2: It gives you a reason to come back.
• 21:00
  Speaker 1: So again, personalization you know, one area great offers, one area a huge opportunity from a content perspective, excellent and I know at the conference you led one of the best sessions at the conference with regard to kind of fraud, some of the challenges that brands are seeing with regard to fraud how it's becoming more organized, there's more structure and it's also very hard for brands to keep up with fraud right Because it can have different kind of form factors.
• 21:21
  Speaker 1: Identifying it can be very challenging At a high level.
• 21:24
  Speaker 1: When you look at some of the fraud issues out there, what are some considerations brands should have?
• 21:30
  Speaker 1: How should they identify it?
• 21:31
  Speaker 1: How should they address it, especially if they're using manual methods?
• 21:35
  Speaker 1: What are you seeing at a high level?
• 21:37
  Speaker 2: Yeah, no problem.
• 21:39
  Speaker 2: Thank you for the opportunity to speak on it.
• 21:41
  Speaker 2: I think I made a point there.
• 21:43
  Speaker 2: It's probably the most depressing presentation you've ever had at your conference, talking about such a negative topic, but it's something all of us need to deal with and I shared twice in my career where I've been stung as a program leader dealing with fraud loyalty fraud specifically once in hospitality and once in the grocery world, and so, you know, the main points I wanted to come out of that, you know, were to tell all the loyalty leaders in attendance it's happening and you need to reconcile the fact that this you know is happening and will continue to happen, and that the folks doing so are way smarter than you and your teams often are, because they are 100 hell-bent on taking you for everything you have.
• 22:24
  Speaker 2: Meanwhile, you may only have five percent of your team's time to focus on this, given everything else that you're trying to make happen, while they are again 100 focused on on taking value from it, and so many companies now are set up you know to think of.
• 22:37
  Speaker 2: You know, in terms of shoplifting at the store, maybe e-commerce fraud, but not the idea of point value fraud, that someone is taking this huge amount of stored value away from the customers rightfully earning it, you know, and using it for their own purposes.
• 22:52
  Speaker 2: So I focus on two methods of fraud at a very high level that I think every loyalty leader should be vigilant toward.
• 22:59
  Speaker 2: One is the account takeover method and the other is the point or value bank manipulation.
• 23:04
  Speaker 2: Account takeover is simply the idea of engineering into an existing account via a data breach, either a mass one or just figuring out someone's personal information, grabbing their loyalty value and then selling it or using it for your own intention.
• 23:18
  Speaker 2: And I found that in the hospitality world, especially from certain parts of the world, they were hacking into our accounts to be able to steal it and then selling it on the dark web for hotel loyalty reservations and for us seeing that we were able to build CAPTCHAs and other elements to keep them more at bay not entirely out, but to limit the damage around it.
• 23:40
  Speaker 2: But to be honest, mark, you know how we were able to figure out was just being vigilant, of being willing to listen to the contact center or inbound complaints from our hotels saying these IDs aren't matching up.
• 23:52
  Speaker 2: Or we have people you know call in they're saying that their point level isn't what we think we is.
• 23:56
  Speaker 2: You know, this is a massive hotel program.
• 24:00
  Speaker 2: We could have just simply ignored it or said, eh, this is kind of the cost of doing business, but instead we made the time to focus and realize this is a big issue.
• 24:08
  Speaker 2: So the idea of being vigilant is a big aspect.
• 24:11
  Speaker 2: And then in the grocery world, it was on an ad hoc report that I had run that I saw some accounts that had massive point redemption levels that just seemed out of whack.
• 24:20
  Speaker 2: And again in the big picture, you know it might have been more of a rounding error but we said we got to look into this.
• 24:25
  Speaker 2: You know, we were curious, that idea of being curious, of wanting to try to find these things, and what it led to in that case was setting up daily reporting that I still look at every morning, checked it this morning as well, to look at the redemption levels overnight to see if anything's jumping out that is worthy of exploration.
• 24:42
  Speaker 2: So you know, summing it all together is again this idea that fraud will continue to happen and you need to admit it and you need to be curious to address it and also to realize that if you're outgunned to bring in experts from the third party that can help you mitigate it as well.
• 24:59
  Speaker 2: Excellent.
• 25:00
  Speaker 1: Okay, it's definitely a big topic and thank you again for being as frank and forthright as you were during the presentation.
• 25:08
  Speaker 1: It was very impactful and any of the people that were at the conference that missed it.
• 25:13
  Speaker 1: They missed what, in my opinion, was the Is having a curious mind.
• 25:17
  Speaker 1: This doesn't look right.
• 25:18
  Speaker 1: It looks non-sequitur.
• 25:18
  Speaker 1: How do I address it?
• 25:19
  Speaker 1: Not everyone has that curious mind.
• 25:21
  Speaker 1: Not everyone can see big picture.
• 25:30
  Speaker 1: Not everyone can see the forest for the trees.
• 25:32
  Speaker 1: So giving them some modalities to actually do that, I think, is very impactful.
• 25:37
  Speaker 1: So thank you for that.
• 25:38
  Speaker 1: Thank you.
• 25:39
  Speaker 1: A couple of quick, more additional questions.
• 25:43
  Speaker 1: Should I say, when you look at the value of the program, one of the discussions we had as well advisory board meeting is looking at the value to the internal, external stakeholders, how they can get prioritized with the organization.
• 25:59
  Speaker 1: We see that in a lot of research that we do.
• 26:01
  Speaker 1: Most of every research paper we've done over the last 18 months, there's been a need to educate internal and external stakeholders as to the value and impact of the program and where there's not, there's struggle right To getting organizational buy-in, to get organizational alignment.
• 26:17
  Speaker 1: You know how do you manage that?
• 26:19
  Speaker 1: How do you talk about the program?
• 26:21
  Speaker 1: How do you educate those who are impacted by the program as to the benefit of the program?
• 26:26
  Speaker 2: Yeah, yeah, no problem.
• 26:27
  Speaker 2: You know, one of the reasons I love this field so much is loyalty is very objective.
• 26:31
  Speaker 2: You can measure everything for better or for worse, and literally on a day-to-day basis.
• 26:36
  Speaker 2: Sometimes it's a good story and sometimes it's a depressing one, but you know where you stand and so, in that regard, there's a tremendous amount of analytics available to you to help tell the story.
• 26:48
  Speaker 2: In my world, I found that the best method of doing so across different audiences inside the organization is to build a comprehensive scorecard that tells that story for you, in the idea of marrying up results with the why that goes behind it, and so often you'll see departments that will just send the results and say, hey, we're up 5% over plan, or you know 3% under, but they don't tell you why that's happening.
• 27:13
  Speaker 2: You know what are the reasons that you know.
• 27:14
  Speaker 2: We can either, you know, validate the success or rally around the issues, and so, for us, building scorecards that we present across the organization is critical, and we measure 104 different metrics on a regular basis.
• 27:28
  Speaker 2: It's a lot, but we consolidate it down to the top 10 or 15, and then give that context on a weekly, monthly and quarterly basis to let other groups in the organization, merchandising finance, legal e-com, understand why things are going the way they are and I found in my career, mark, that you know there are some folks in an organization that are skeptical of loyalty.
• 27:51
  Speaker 2: To understand, you know why are you making this investment.
• 27:54
  Speaker 2: You know this is a cost investment, that if people are going to shop, they're going to shop.
• 27:58
  Speaker 2: You know you don't need to put these things on top of it and how important it is to be able to validate the program and for us, I teach loyalty, I do it at work.
• 28:09
  Speaker 2: Loyalty comes down to two things.
• 28:10
  Speaker 2: You're introducing a cost model that is meant to support both incrementality of share wallet and retention of sales over time.
• 28:17
  Speaker 2: So a new cost brought in to make people change behavior.
• 28:21
  Speaker 2: They're spending more, you have more of a share wallet and over that attrition is mitigated and that, to me, is really the foundation of loyalty.
• 28:30
  Speaker 2: And that's what we attempt to prove to our stakeholders across the organization on a regular basis that the program is driving additional share of wallet and we're retaining our best customers, more so than those who are not part of the program or those who are not engaged.
• 28:46
  Speaker 2: You know in that digital capacity and we found that that's an easy way to make it less intimidating, you know, to get beyond the data points but to really share those why stories and to boil it down to those key, critical KPIs that really help validate the program as a whole.
• 29:04
  Speaker 1: Excellent.
• 29:05
  Speaker 1: What's next for the program?
• 29:06
  Speaker 1: You guys, like I said, award-winning continue to kind of push the envelope, looking at fraud, driving internal alignment.
• 29:14
  Speaker 1: What's next that Giant Food is going to be focused on, kind of strengthening that customer relationship.
• 29:20
  Speaker 2: Yeah, yeah, I got to be careful here because we've got a lot of good competitors out there and I don't want to tip it too much there.
• 29:26
  Speaker 2: But I will say that I think there's two key areas that we personally and you know I'm sure others might be focused on.
• 29:32
  Speaker 2: And, mark, you and I were talking about this at the beginning of the call, but we are in a value focused era right now.
• 29:38
  Speaker 2: People need to stretch the dollar more than ever before, and groceries, I think, is at the top of that list.
• 29:45
  Speaker 2: I mean, it is a foundational in the hierarchy of needs.
• 29:48
  Speaker 2: You know, right there at the top.
• 29:49
  Speaker 2: You know, and in that regard we are looking at our benefit structure to try to help every customer get more with less points, so that even cursory shopping trips with us can lead to value.
• 30:03
  Speaker 2: And it's that whole idea of returning them into the store, by nature of this program, being the catalyst for where they might shop.
• 30:10
  Speaker 2: You know, again, if I have my power users, I can count on them to come to Giant.
• 30:14
  Speaker 2: But it's those kind of discretionary shoppers that every week are saying, ok, do I go to Aldi, do I go to Safeway, do I go to Giant?
• 30:20
  Speaker 2: You know I'm thinking about.
• 30:22
  Speaker 2: You know where the deals are, but if they know that they have, you know enough value to get that free gallon of milk and a free rotisserie chicken to feed the family that night.
• 30:30
  Speaker 2: There's tremendous power in that for that to be the differentiator to drive that trip.
• 30:35
  Speaker 2: And once we get that trip, you know there's that incremental spend that goes with it as well.
• 30:39
  Speaker 2: So that's one path.
• 30:41
  Speaker 2: The second path is this idea of building a ritual through the program.
• 30:45
  Speaker 2: I am hell-bent on trying to tie an experience within our stores to our loyalty program and my great analog there is the airlines.
• 30:55
  Speaker 2: You know the word status that you get on the plane early, you get this benefit reduce the stress, get your stuff, get settled before everyone else gets on.
• 31:04
  Speaker 2: And that's one of the huge ways that the program makes you feel special in the airline vertical.
• 31:10
  Speaker 2: It's that ritual that you have and so points and miles like you can't touch it, it's ethereal.
• 31:15
  Speaker 2: But the way the program makes you feel is hugely powerful.
• 31:19
  Speaker 2: And so that's what I want to try to find for grocery.
• 31:22
  Speaker 2: And it's not easy, otherwise know, otherwise we or someone else would have figured it out.
• 31:26
  Speaker 2: But is there a way that the program itself, the loyalty program can change the way you shop, to make something better, to reduce a pain point, so that again it really ties into the experience and becomes part of that emotional loyalty story you talked about earlier.
• 31:42
  Speaker 1: Absolutely.
• 31:42
  Speaker 1: And then last question what can Loyalty360 do to continue to help you and your team and your customer loyalty journey?
• 31:48
  Speaker 2: You know we talked about fraud.
• 31:50
  Speaker 2: That whole area really came up out of the meetings that you and the team set up on a regular basis to cover different facets of loyalty.
• 32:00
  Speaker 2: You know this whole world of different focuses, whether it's analytics.
• 32:04
  Speaker 2: You know fraud positioning, customer behavior, you know benefits, tiering, subscriptions.
• 32:10
  Speaker 2: I mean you guys, on a regular basis, are touching upon a bunch of different areas that often programs don't have the thought leadership or the time to actively consider on their own, and so what I love is when you bring these different topics up and you bring different leaders together.
• 32:25
  Speaker 2: It helps us hyper focus on an area of loyalty that either we need to develop, you know, or we're not sure where to go, and you know when thinking about things like fraud.
• 32:34
  Speaker 2: You know or you know the analytics focus that you've had recently.
• 32:38
  Speaker 2: I've benefited from those experiences personally and joining those calls and being able to share and learn from other leaders.
• 32:45
  Speaker 2: So in that regard, you know, to my knowledge, you guys are the only ones who are really focusing on true issues and topics and opportunities and then bringing a range of different loyalty groups together to share best practices or to talk about their challenges, and to me it's worth its weight in gold and I don't think you and Carly and the rest of the team enough for what you do.
• 33:05
  Speaker 1: Excellent.
• 33:06
  Speaker 1: Well, thank you for that, and thank you for taking the time to speak with us today.
• 33:09
  Speaker 1: It's always great to catch up with you virtually or in person.
• 33:12
  Speaker 1: I have a great deal of respect for what you do with the program and a great deal of respect for you personally.
• 33:17
  Speaker 1: And I was actually looking at your LinkedIn or somewhere I came across that your wife has a unique story as well, correct?
• 33:25
  Speaker 1: She was a combat veteran, is that right?
• 33:28
  Speaker 2: That is my sister, so my sister, my older sister.
• 33:31
  Speaker 2: Yeah, no, she's pretty awesome.
• 33:32
  Speaker 2: She was that first wave of female combat aviators.
• 33:36
  Speaker 2: She flew F-18s back in the day and she's very special.
• 33:39
  Speaker 2: She is an amazing woman.
• 33:40
  Speaker 2: My dad's a Marine general.
• 33:41
  Speaker 2: My brother was a Naval intelligence officer.
• 33:42
  Speaker 2: My mom my dad's a Marine general.
• 33:44
  Speaker 2: My brother was a Naval intelligence officer.
• 33:46
  Speaker 2: My mom at one point was a Marine as well.
• 33:48
  Speaker 2: I come from a family of military and of course, everyone said well, what the heck happened to you?
• 33:52
  Speaker 1: Yeah, I've heard that.
• 33:53
  Speaker 1: I know you've referenced that a couple of times.
• 33:55
  Speaker 1: I came across that just someone's your last, I don't even know how, but that that that amazing.
• 34:00
  Speaker 1: But you've told the story about everyone in your family being the military success that they are and they happen to be.
• 34:08
  Speaker 1: So I just came across that.
• 34:09
  Speaker 1: I'm like I wasn't sure, but that's good to know as well.
• 34:12
  Speaker 2: Yeah, yeah.
• 34:12
  Speaker 2: No, I'm very proud of all of them, but also, you know, very proud of the decisions I've made.
• 34:16
  Speaker 2: You know, I knew what was right for me and what wasn't.
• 34:18
  Speaker 2: And so far, so good.
• 34:22
  Speaker 1: That's good, all that's good, all right, perfect.
• 34:26
  Speaker 2: Well, thank you again for taking the time and thank you everyone for listening and make sure you join us back for another edition of our Leaders Customers Loyalty Series soon.
• 34:30
  Speaker 2: Thanks again, mark.
• 34:31
  Speaker 2: Take care, all right, thank you.
• 34:36
  Speaker 2: Thank you, bye, bye.