Bhavna Wadhwa: Hello, and welcome to another episode of Zafin Banking Blueprints, where we bring together leaders from across financial services to explore the ideas and shifts shaping the future of banking. I’m Bhavna, and today we are talking about something that has been part of banking for decades, but is undergoing a fairly significant rethink loyalty. I’m joined today by Victoria Dravneek, Head of Loyalty Strategy and Platforms at PNC, who has been closely involved with PNC Total Rewards, and Carson Kotnyek, Head of Industry Advisory at Zafin.Victoria, Carson, welcome. It’s great to have you both here.
Carson Kotnyek: Good to be here.
Victoria Dravneek: Good to be here.
BW: Victoria, tell us something about you and what have you been doing at V and C.
VD: Sure, sure. So as you as you said, I lead loyalty strategy and platforms for PNC. And what is that? So at the basic level, I’m responsible for strategies that initiate and grow relationships with our clients because relationships are what it’s all about. And we grow those relationships at scale. And some of the, you know, some of the metrics that I’m responsible for driving are the satisfaction.
With our customers, the retention of our customers. So we want them to stay and bring more of their business to us, and the actual deep deep with our customers. And you mentioned PNC Total Awards. And so one of the first strategies that we’ve enabled PNC to grow those relationships is PNC Total Awards, is a client-centric full relationship loyalty program.
BW: (01:42.124)
I’m looking forward to digging a bit deeper and understanding more about it. Carson, we have your introduction and then maybe let’s talk about and get your take on how is loyalty evolving in the industry.
CK (01:53.324)
Yeah, happy to do so. So I lead our what we call our industry advisory practice at Zafin. And this essentially gives me, you know, the fun job where I get to travel the world, spend time with our customers, and really help bring the global perspective all the way down to the regional perspective in solving not just how does technology enable what the strategic objectives are, but be able to work through the approach as
If it is about improving relationships, if it is about ensuring that our customers have a path to grow with us, how do we actually bring in the right strategies to do so? And maybe that’s a good, that’s a good segue, Bhavna, into the question you’re asking, right? Around how is this world evolving? And you opened with a really great point, which is you can go to any bank in the world and have a discussion on loyalty, you know, which is why I’m =such a big fan of PNC because
Essentially what we’re hearing is, and believe it or not, I still have this conversation, which is, loyalty program equals points programs. And you know, and we see that dramatically changing. And you’re right, there is this awakening, though sometimes maybe still feels a little bit later than it should, but there is this awakening around, you know, it can’t just be a loyalty program, whether it’s points or cash back, limited to one product.
Where if I’m incentivized to use a great credit card product, but that doesn’t impact everything else I do at the bank, it doesn’t enable the financial institution to recognize me and everything that I do. You know, if I have a mortgage and a credit card and an everyday banking account, of course, all of that should be recognized. And so maybe what I’ll just finish on here is I think this is where we’re seeing this sort of Rubik’s Cube as to how do you solve that?
Right. And the through line, without a doubt, is some version of a relationship program. And some version of this should be really a win-win. It’s good for the bank. It’s good for the customer. And ultimately I should have a reason to bring all of my financial activities that I do under one roof, as opposed to I’m sure that we’ll get into it a little bit, but is, you know, a growing trend of fragmentation of, you know, especially as we look at millennials and Gen Z and having three, four, five, six different banking relationships, that’s not by design. They actually would prefer to have less than more, but a lot of banks aren’t necessarily giving you a reason. But you know, I’m well I’m curious to learn from yourself on this as well, Victoria.
VD (04:23.948)
No, I agree with everything you said. I think there’s some all also kind of some larger kind of plague tectonics within financial institutions as well. You know, one of those is that banks are increasingly looking to grow their deposit base, right? They’re looking to do it organically, they’re looking to buy it, like they just they know they need to do it, right? And so any sort of relationship programs that encourage clients to bring more of their deposit dollars, their investment dollars to the bank are hugely, hugely important.
I think the other kind of big play tectonic thing is it’s been out there for a while. You know, there’s all these rumblings over time of legislation you know, to cut or reduce interchange, right? And banks are like, well, we better have a hedge for this, right? Because if we wake up tomorrow and we can’t make money off of interchange, what happens to our awards programs? You know, so it’s really important to kind of think about that relationship at that level for those reasons. And then the third thing I think about is.
Forever we’ve had credit cards, you know, we have points programs, et cetera, over there, right? And those are really rewards-based. And then you have the investment relationship. And I call it a relationship because it has to be a relationship-based because you it just requires another level of trust, you know, higher level of trust, right, than a single product. And so when you bring, you know, banks together that have all of those products together, the relationship becomes so much more important. And then finally,
If we think about all the fintechs and everyone who’s out there kind of nibbling at different aspects of banking, the thing that the large banks have still at their disposal is scale. And so, you know, the relationship based loyalty programs take wonderful advantage of that scale to provide more value to our customers.
BW: (06:04.75)
Victoria, let’s dive a little bit deeper into this. You were talking you talked about customer relationships. Those are significant. What were you seeing? Were you seeing any change in customer behavior that that kind of triggered the idea that, hey, we really need to focus on on the overall total customer relationship and what triggered, what was the impetus for the for the total rewards program?
VD (06:27.192)
So the impetus for the for the Toll Rewards program specifically was that leadership saw that these kind of programs drove the kind of results that they were looking for. They’re looking for the additional deposits, the additional deepening with their client base, et cetera. And so, you know, coming in, looking at you know the client base of PNC, we saw that we had there was a lot of opportunity.
And especially if you looked at our emerging and mass influent audiences, we saw that, you know, they had a lot of their business with us, but they had a lot of their business off of us. You know, we could see that they didn’t really have their whole business with us. And so we had a huge opportunity to deepen those relationships with our existing clients. And so there were the ones who already qualified for one of our herd shares of the program, and there were ones who had, you know, even less of us and were like, well, why?
What are things that we can do to encourage them to deepen and get additional value out of that relationship?
BW: (07:25.998)
Amazing. Carson, is that something what are you seeing from a, you know, loyalty and relationship perspective? Like what are some of the customer behaviors that are driving this?
CK (07:37.366)
Yeah, it’s you know, I’m just nodding along to everything Victoria is saying because it’s you know, just the extent we see these things and you know, even some of the most basic items that that I find are most interesting as organizations are exploring this, right? So I’ll give an example. The many of the products that a bank has today, it can be as simple as here’s an everyday banking account, here’s a checking account. And that account already has some of these things like free ATM fees.
Or they waive the monthly fees. And one of the challenges I see all the time is that banks are actually giving a ton of this value to customers, but it’s not front and center. So it might not be in the digital experience. When I log in, I’ve heard the stories, seen the research of well, we’re giving 10, 20, 30, $50 a month in value to customers, but they don’t even know. And so a customer doesn’t feel recognized, the customer doesn’t feel rewarded, even though to some degree, right, there’s sort of this perception, you know, reality perception gap, which is, I’m actually maybe I’m getting some of these things today. You know, more and more I’m seeing this sort of mismatch where there are pockets of value, right? And all institutions are try are, you know, they want to reward their customer in some way because they ultimately want to drive deposits, they want to drive the average number of products a customer has. But it’s one of the most fascinating things as you start to look at whether it’s the fintech style subscription where I pay to play and I’m paying for access to, you know, a tier or a level, or whether it’s, you know, maybe a little bit more of the North American flavor, which is maybe what I’ll call earn tiers, you know, almost like, you know, some parallels to the airline model, which PNC is doing where you where you’re being rewarded as you grow and you earn into these tiers as opposed to paying for them.
And part of that is just being able to have this mechanism that shows you clearly the value that you’re getting. Already step one, the customer is you know, if we look at something like a customer NPS, it’s already going up, even if you were already , say, getting an ATM fee or something for free. But then it does, you know, a lot of Victoria, what you were saying, it does this sort of journey, right? And there’s, you know, there’s a bit of a reason.
Whether it’s the airline model or whether it’s a trip to Costco, right? That’s when these programs do it well, it’s that I have a path, I have a journey to follow. The value I’m gonna get is recognized. And that doesn’t mean I have to be at, you know, a $250,000 tier tomorrow, but it does, you know, give me some excitement and and give me a journey that I know as I grow with the bank, that the bank is also going to grow with me. And I think that’s a it’s a psychology shift in customers versus feeling maybe like, my bank is just a transaction place. I go there when I need to, as opposed to I’m growing with them.
BW: (10:33.11)
This is a question for both for both of you, but maybe we’ll start with you, Victoria. So we talked about how the perception of value for customer changes. How does that change as you were developing a program? Well, how did the perception of value change for leaders within PNC and within the organization?
VD (10:49.206)
I love what you’re saying. Right. So banking had become, you know, much more commoditized, much more transactional. If you think about the old kind of rewards programs, they’re by transaction, right? But once you start to do things at a at a full client relationship level, it becomes less transactional. And then you start and it and then if you know a financial institution really kind of grabs hold of that relationship concept.
And is very client-centric, like the one I’m at, then they go, okay, let’s double down on this. You know, so we’re going to increase the number of branches we have in in multiple places, right? Because we know there are places where clients have much more complex needs. What happens in that branch is gonna change, right? So it’s much less transactional in the branch now. It’s much more a place to have more complex conversations to meet your needs, a place to really, you know, continue to build that relationship and to make everything else we’re doing believable. And so the, you know, the institution I’m at has really embraced that and surrounded it with all of these things, including also Premier Banking. You know, so certain of our higher network clients get an entire banking team along with this great program, along with all the other, you know, great benefits we provide at PNC, along with the wonderful hospitality that PNC has become known for.
BW: (12:13.122)
Yeah. So definitely like the loyalty leaders are really thinking about value from a from a very different lens. How easy is that to implement? Or actually how hard is it to implement?
VD (12:25.312)
It we had great bones at PNC, right? So, you know, I told the story I got here. And when I first got here, I really didn’t know anything about PNC. And so, you know, I spent the first 30 days, I talked to look over 100 leaders. And I just had these kind of conversations with them and asked them, you know, kind of specific questions about who they were and what they cared about. PNC really cares about the customer. And when you’re interacting with PNC, even the sales people of PNC, it’s not like a hard sell. It’s more they really care about the customers, they care about what they need, they care about, you know, all those aspects, right? And it’s an incredibly collaborative culture. you know, so one one of the first meetings I I ever had with the head of retail, I said the quote to him, Culture eats strategy for breakfast. he was really surprised because he actually has that quote on his wall and he wasn’t in his office. So but it’s so true, right? You know, so we could have had the greatest strategy, but if we didn’t have the great people at PNC, it just it just wouldn’t have resonated, right?
The =other side of that is, you know, in a very collaborative culture, you can pick up the phone and call anyone and you can learn anything you want to learn, but everybody’s at the table, right? And you have to help you have to kind of keep everybody happy. You have to make sure that you’re you’re caring for all the pieces, bits, and parts. And a and a program, you know, like Total Rewards, touches every single product, it touches every single channel. And so we were touching everyone in a very horizontal strategy that isn’t something that that the company was really used to. we had great, great executive sponsorship and support. So we were able to to navigate that really excited about it. You know, the other challenges, obviously it’s challenging to create a technology capability set that’ll match that and also to integrate it with everything that currently exists. all those problems, they feel a lot easier for me. you know, the ones and zeros, they’re they’re a lot easier for me in my mind. it but yeah, you know, just just getting everyone like on the bus and excited and there. We we had some great partners on that.
But but it was a challenge, that that I think is will yield dividends for us for years to come.
BW: (14:25.23)
Amazing. Yeah, absolutely.
CK (14:26.574)
Okay, I gotta ask the question on on this one, Victoria, because it’s you know, and and maybe this is to what you’re what you’re pointing out on, you know, maybe you all had an advantage, and though maybe doesn’t feel like a definable fully definable advantage, clearly is one. The cultural PNC spoke to, you know, and this unity alignment across the bank. Cause one of the things I hear all the time is as soon as we enter the relationship discussion.
the line of business discussion pops up. And it’s like, yeah, we it great idea, but that means, you know, the wealth business needs to come to the table and the mortgage business and the DDA and and all of a sudden, a great idea. It’s like, it’s, you know, I don’t know how, you know, where’s funding gonna come from? How do we orchestrate it across those silos? So curious just to hear a little, you know, a little bit on how you all orchestrated that.
VD (15:19.436)
Yeah, it well, they kind of owned all of it so he could tell everybody, you know, hey, come to the table. you know, and so they did, but we had some guiding principles that, you know, that we really kind of went by. and I won’t go over them in detail, but one of the things that we were trying to do is we wanted to ensure that any of the benefits that we had on the products actually benefit the products. Card’s kind of in the middle, but almost all of the products, they told us what benefit they wanted to provide.
They told us how much they thought it was going to grow, you know, their acquisition volume. They told us how much they thought it was going to grow their deepening volume. So it’s very much like a partnership and collaboration, and it’s designed to increase the acquisition and the deepening with each of the products, right? And so we’re working very closely with all of them on that. And then all the testing we did. And so when you develop a model for a loyalty program, you go through a lot of customer testing, right? So you go through and you’re like, okay, does the model work? Does the model make someone want to enroll in the program? But then we went through, okay, well, does the model also make them want to open these products and use these products? And at the various, you know, some of them we would go really deep. At this, these sensitivity levels, they want to open the product or use the product more. So there were some products, we even went down to the individual percentage sensitivity levels that we were doing just the right thing. Like the customer, the customer has to love it.
They have to love it, they have to want to do more, they have to want to deepen. And it has to make good business sense. And at the end of the day, you know, we’re able to have a shadow PL that sits above all the PLs. So we’re not touching their PL. Like it’s above, right? And we’re looking at a cohort over time. And so just like a PNL for a product looks at units over time, we look at the cohort, right? And yeah, it it’s a hard thing for our product partners to wrap their head around. We’re working on them. But at the end of the day, we’re gonna track that cohort over time. We’re gonna see what they do. We’re seeing them open products and use products at a much higher level. And these are our most engaged clients already. They already have a lot of the products with us. So we’re already seeing behavior that’s the behavior we know we’re gonna see, right? But we have to normalize it. It takes more time. And that’s the really hard thing with because leaders are so used to immediate gratification of the unit. This is not immediate gratification. You have to look at it over time.
Once you look at it over time, you can do multivariate gradient match analysis and say, Hey, what is the probability that this program is making a difference? And so that over time and we’ll continue to increase confidence of all of our leakers’ development program. And that’s how we’ll grow.
BW: (17:59.822)
What I love about this this discussion is it’s about technology, but it’s about more than technology, right? Like it’s really about culture, it’s really about working together, it’s really about looking at that bigger picture. And Carson, maybe we’ll get your industry perspective on this looking at across other organizations too. What are the things that organizations really need to think about beyond technology to make this work?
CK (18:28.31)
Yeah. Well, I would say first and foremost is sign up for Victoria’s master class on how to crack the on how to crack the bank unification piece it is one of the most common discussions I have. so you know, wrapping all of that into, you know, if I were to attempt to summarize is, you know, sort of some version of top-down organizational alignment. Of course, that doesn’t mean a mandate, but it means, you know, this is the type of bank we want to be, this is the type of culture we want to drive.
And then having that mission on one reason I love this area of the business is because I I legitimately believe it’s one of these rare win-wins where going through this effort, if we look at all the traditional metrics of a bank and what’s going to be in a quarterly earnings report, it’s going to be higher number of customers, you know, or more account openings, it’s going to be deposit growth, it’s going to be an increase in a reduction in tenure, an increase in average number of products per customer.
So from a traditional metrics point of view, with, you know, without the instant gratification, you know, but over time, the right data science will be able to show that that is in fact true. It’s solving this thing that the banking industry traditionally hasn’t been the best at, which is it’s also a win for the customer. Right. And I think that’s one of the most unique things, which is when we have the fintech conversation, when we look at all of these different narrow verticals of, you know, the investing app pops up.
And then the everyday high interest savings account app pops up. You know, one of the biggest pieces for me from all of our research has been is that but that’s not what is actually wanted, right? Like a person, even the 25-year-old tech savvy person who loves the latest app, even they show in the research that they don’t want to have five apps. They would prefer to have, you know, one or two. And so, you know, I come back to this true win-win scenario, which is it’s clearly good for the bank, but ultimately, what we’re doing is we’re changing that entire relationship, that entire psychology with the customer, where if done right, which is not an easy thing to do, but if done right, the customer clearly gets to say, Well, I’ve got my 401k here now and it’s growing, which has benefited the next tier that I’ve achieved or I’m about to achieve, which is going to save me on fees and is going to help me save for my first home.
And you just get this snowball effect. Things that are good for the bank and good for the customer. Now, it again, it sounds easy easier than it is. There’s, you know, it’s not just as simple as you spin up a program and and it works. Every institution needs to find what it is that’s unique to them. It might be your region, it might be your culture, it might be, you know, the sports teams you sponsor. There could be so many pieces to the puzzle. but you know, I think maybe, maybe I’ll end with that, which is this win win piece that changes this whole dynamic from real transactional product based banking. I come to the bank when I need a credit card or I need a mortgage and changes this life journey path that that is enabled through a relationship program.
BW: (21:35.822)
You know, you when you when you talk about the program, I see a lot of ingredients which sound easy but are not easy that are really required to bring loyalty and a whole customer relationship program together. As PNC Total Rewards is now in the market, what are you seeing in terms of the outcomes? Like are you are you seeing the engagement that you were hoping for? What are the things that you are continuously improving on? And you know what, I’m gonna tack on to that and say, Hey, no conversation is without AI these days. How do you think AI or technologies like AI is gonna help refine that further?
VD (22:12.482)
So what we’re seeing, if I think about, you know, loyalty programs also are about measuring everything, right? And continuous improvement. And so we’ve been measuring everything that’s been happening digitally in our branches and in our care center. you know, in our care center we have priority and concierge servicing for these clients as well. So we’ve set up an entirely new infrastructure for all that, which is amazing. We’re watching our operations and we’re making sure that we’re delivering all of our benefits, we’re delivering all of all of our promises, that we’re meeting all of our SLAs. And then all of those, you know, all of those secondary measures lead to our primary measures. And so our primary measures, the deepening. So we’re seeing a lot of new product, especially in the areas our deposits and savings accounts. We’re seeing a lot of investment accounts, cards. And then we’re also really tracking the new money. So, you know, what are we seeing in terms of new money and investment and deposit accounts? We have a bit of a longer lag time on some of that. And so we’re working through that over time. And then we’re also tracking like what kind of satisfaction results are we’re seeing? Because we know with these kind of programs with these clients, at first they have questions in the beginning, but then things kind of raise from there. We’re starting to slowly get get some of that data in. We’re about three months in now, you know, to and tracking all of that. so everything is moving in the right direction.
In terms of, you know, AI and and how I think about you know, AI and the influence there, just from a scaling kind of perspective, you know, there’s a lot of AI being used at at financial institutions. We’re no different. You know, a lot of backhand stuff going on. We’ll see a lot of like human in the middle kinds of things. So a lot of things and operations and making things more efficient and effective. That makes things better for the clients because
If there are issues, they get fixed more quickly, you have less issues, you’re able to do things more easily. But then we get to we can leverage it in how things actually get to the customer and what can get to the customer. And that becomes a much bigger conversation. I’m pretty down to earth in thinking about these things. I think about these things in in terms of relationships, right? And so AI is a tool. It’s a powerful tool, but it’s a tool and it’s an enabler, a strategic enabler.
We’re doing things that make the client feel valued and show them that tangible value. Carson, I think you mentioned, you know, making people feel valued. That’s the hearts, right? So when I think of what AI can bring to the conversation of the relationship before this, clients expect maybe you remember the preferences, you kind of know something about them. But like your conversation outside of something like this has been a lot more kind of binary. Like it hasn’t been like rich with context.
I think what AI is going to bring that, you know, that personalization was looking to bring before that. We used to just call it personalization, right? Is that context, right? So if we have, you know, if we’re friends, I know something about your history and where you’ve been. I know something about what you like and what you don’t like. And that’s gonna govern what we talk about. And it it’s probably even gonna govern how we have our conversation, maybe how I see it. We didn’t have that before, right?
So if I think about, you know, the the platforms aspect of thing and all the capability sets, there’s great beauty in taking a lot of the engines that we have now and fusing them with the AI capabilities to then begin to have an actual conversation with the customer. So some of our customers, we will never see face to face. So we want them to feel
Like the hospitality that PNC provides, even if we can’t see them face to face. And even if they do see us face to face, they’re not seeing us face to face all the time, right? So we want them to feel all the feels, you know, customers of the branch with us. But we want to keep, we want to keep that going, right? you know, so I think getting our data right and in the right formats, because we have enormous amounts of data, and then putting those AI models over it, being able to then talk to our customers in exactly
The way they want us to talk to them, create that full end-to-end experience to even create the journey that you were talking about, Carson. A lot of the things that we provide our customers today, we give them like this big thing once they’ve done all the things, right? Well, we have the opportunity that every step along the way, we know what’s happening. And we can talk to them, we can congratulate them, we can encourage them, especially you want to talk about Gen Z, they want to be encouraged, they want to know they’re on the right track. Well, this is going to enable us to begin doing.
BW: (26:49.342)
AI can open up a lot of capabilities, right? And it’s about using it the right way. So I love what he said about like making sure that you’re using the data in the right context and creating that journey, keeping that human touch going. Karson, your thoughts? And I know you want to say something here.
CK (27:04.978)
Yeah when I was listening to what you were saying, Victoria, one of the other things that comes to mind for me, which is there’s this entire conversation around how banks are getting better and applying AI. There’s also the flip side of that conversation, which is I’m a customer in the market and I have banking needs. And as we all know, this transition that we’re in from traditional search into
AI everything search. So if I use Gemini, if I use Claude every day for all of my things, somewhat you know, maybe some would call it alarming, but a at a dramatic rate, people are essentially telling everything to their AI. It’s like, you know, I’m I’m interested in retiring early and I would like to save. And how do I save? And what should I do? And here’s my current financial scenario. So all of these things are being dumped into these models. And a big part of that is.
you know, boils down from anything as simple as, hey, what credit card should I I get? Because, you know, I like to travel or I’m looking for cash back, combined with what are my savings goals and all these different things that I want to do. I think one of the maybe less talked about advantages in having a great program that layers all of these benefits and creates this relationship is it’s also going to help you be found through that process. Right. And one of the things we’ve been battling
In banking for so long is in some ways a race to the bottom, right? If I’m getting a new CD, it’s just who’s got the best CD rate? And of course, rates matter. If I’m looking at a banking relationship and saying, well, I want a good CD rate, but that also gives me, you know, bad example, but I use ATMs frequently. So I need I’ve, you know, free ATMs would benefit me and something on my, you extra benefits or a multiplier on my credit card would benefit me.
So if I’m searching and engaging with my AI to find what is the best banking relationship and what’s the best scenario for me, well, well, guess what? a PNC program that is discoverable, which of course it is as it’s out there, is gonna come back with a with a recommendation or at least be able to paint the picture of well, where can you get your best, you know, financial journey and where can you get treated the best? That’s gonna show up a heck of a lot more than random checking account has a fee waiver.
CK (29:30.146)
So it’s this interesting, it’s this interesting place where these items come together, which is the bank is going to be able to offer a curated experience that has context and is we finally get to personalization, but it’s also the other end of the spectrum, which is, well, how do I discover what’s best for me when it’s factually true that, you know, a great relationship program is ultimately going to be better for my financial journey? It’s going to help steer me in that direction.
BW: (29:57.708)
You know, it’s almost like you need both sides of it, right? Like you c you you need to be to you need to be really focusing on the on the whole customer loyalty. You need to be focusing on the customer because the customer is also looking at you very differently now. So how do you make sure that all of it kind of goes together? That’s amazing. Where do you think loyalty is headed now? We talked about, you know, the customer relationships, we talked about AI playing a role.
What is what is next generation of loyalty? Like w with in this AI world and it’s gonna continue being enabled by AI. what does what does loyalty look like over the next few years?
VD (30:36.814)
I think it becomes a lot more about the journey. As we’re able to some of the things I think that we’ve put in place in the in the past, and even some of the things that we’re doing now, we’re getting creative with the limitations that currently exist. And so I was I was mentioning, you know, the big thing at the end versus talking to the client along the way. I I I think we have like that opportunity to talk to the client along the way. I also think we have the opportunity.
Opportunity to be a lot more proactive. We’re very reactive today, right? Because the signals that we have are imperfect. You know, we’re we think maybe they’re doing this, but we’re not sure if they’re doing this. It’s like we’re slowly putting things together. We’re playing the notes of a song without playing the beautiful whole song, right? We’re limited. I think when we take some of those limitations off, we’re gonna be able to talk to the client along the journey, reward the client where it makes sense along the journey.
And reward the individual client for who they are and what in and in currency that would matter to them. Carson, as you were talking about, like things that that they actually care about. And then products don’t become products anymore, they become more experiences. So what is your experience? There there’s certain things you have to put out there to be scalable and marketable, but that then there’s that deeper level, right? Of getting in there with that relationship with the client. And I think our our our technology and then our adaptability to all of that.
Because I I remember when I first got into personalization, people were really freaked out. They’re like, the information, how do I feel about that? But now it’s like, well, everything is out there everywhere. And yes, Carson, you freak me out. I’m telling them way too much information. Yes, that’s But it just is, you know, we might as well, you know, all take off our our tinfoil hats and keep going. It’s an expectation. It’s no longer a you know, a delighter, it’s gonna be an expectation. They’re gonna expect us to know them. They’re gonna expect us to know what’s next for them. They’re gonna expect us to put things in front of them that are good for them. They’re gonna know if we’re just doing it to make money. It’s a little clear. And some people, the things are good enough, they’re not gonna care. but but some people will be like, well you said you were this, but you’re not this. So I mean I think the the relationship factor is gonna matter more and more more. I mean if you look at the loyalty industry as a whole, ninety percent of brands now have a loyalty program. There’s a reason for that. It’s about the relationship. I just think that aspect of things is going to become even more important.
BW: (33:11.778)
Yeah. Yeah, he’s not gonna take that away. But I agree, Carson, you did freak me out there. But you know what? It’s true. It’s true. People are telling more than they need to. There is a level of trust that’s developing. It’s kinda odd to say it’s trust, but you know, where where where do you see all of this heading? Where do you think the loyalty industry is going?
CK (33:33.454)
Yeah, I really think it’s one of these major accelerators. And and what I mean by that is, you know, if we were to use the analogy is, you know, one of the things we might look at the consumer economy right now, and you often hear the the K-shaped economy. I think you all you see a version of this as we compound the different items that we’re talking about. So a real whole customer relationship program, whole customer loyalty program combined with.
AI that has context and personalization combined with better experiences, better products, the culture. Us on this call have this conversation and we and we live this every day. But if we go look at the thousands of institutions that are out there, the majority ha having this conversation are aren’t =even close to doing so. And there’s a many reasons as to why, whether it’s size or technology capabilities or whatever it might be. But as this happens, we’re gonna see.
A group of institutions that are just going to can continue to emerge, right? You know, Victoria, when I was thinking the big A word when I was listening, right? Authenticity. That combined with value, combined with customization in context, is just going to continue to set these winning organizations apart from others. So I think we’re going to see an accelerated distance growing between an institution that can offer this level of value.
And a customer expectation that is now going to be taught to expect it. Then I think in this group that starts to really pull away from the pack, maybe at an accelerated pass. I think where that also goes is then the challenge of let’s call it a the bar continues to rise, right? And you know, when a program like PNC’s comes out, the bar rises. And so as part of that level or the pace at which change will happen enabled by AI, whether that’s the ability to have a software development lifecycle that means we can churn out products or experiences or digital UIs faster than ever. Well now it starts to become okay, we have a set of banking benefits and a journey that the winners are able to deliver. What else? Right. So we talk a lot about beyond banking and partnerships and you know if we s if we sponsor a sports team, it’s bringing our banking experiences as part of the experience at the stadium or with our partners, the ability to have choice, right? Maybe it’s not everyone doesn’t travel and doesn’t want free airline lounges at the airport, but in but instead I’m a lifelong learner. So I prefer to have, you know, a masterclass benefit. So I think it’s a bifurcation, you know, the winners are probably gonna continue to centralize to be winners, which maybe continues to spur MA and these other things. And then amongst the winners is and you know, the next level of bar raising over the coming years as to going beyond banking, what is that uniqueness and differentiation, not on Victoria’s you put it, it’s not just on how much cash back I can get or just what the rate is, but differentiation on
authenticity and brand and what I resonate with, what the culture is, you know, and we see more and more of that with all of these loyalty programs within financial institutions and beyond, which is, you know, you choose your brand because you relate to it, not just because it’s, you know, the best shoe or the best banking product.
VD (37:09.272)
You know, and I marry that together in my mind with the whole journey, right? Because the the journey in in my mind, if we think about what the customer is actually trying to do, then we’re in a way we’re reaching into their lives, right? And it, you know, and their lives aren’t banking. You know, their lives are what they do with their, you know, what they do with their money, what they do with their resources. And so if we can help them in what they do, you know, with their resources, you know, certainly within the walls of what is traditional banking, but then alsovif we can partner with third parties to give them even more additional value and make things easier for them or more convenient or get them more confident or help them learn. I think that’s it’s so valuable to be able to do that. And so third party is important.
BW: (37:54.83)
Well, thank you, Victoria. Thank you, Carson. If I had to summarize, I will say it is about the customer. Make sure you’re authentic. Make sure you are really focused on bringing value to the customer and internally just, you know, have the right culture. It’s it’s about right having the right culture. It is about technology, but it’s so much more than about technology. It’s really putting at the customer at the center. It’s about having the right culture. It’s about building those relationships and working together.
And that’s what builds loyalty. Thank you. Thank you. It was a pleasure speaking to you both today. Thank you.
