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“You have executives that are sitting around the table thinking, ‘How do we stand out? How do we generate more value or more revenue?’ But I think very few people actually put on the hat of the consumer. They're thinking of that brand — no matter how big that brand or retailer is — they're probably only thinking of [consumers] for a teeny fraction of a day … but if you really want to move the needle in the long-term, you have to talk to and tap into the long tail of consumers.” — Wes Schroll, CEO and Founder of Fetch Rewards
With acquisition costs rising and margins tightening, brands need to expand the value they give to their existing customers to drive growth.
Consumer loyalty programs are a great way to deliver value to customers, but they traditionally focus on giving rewards from an individual retailer rather than multiple.
Fetch Rewards, a free shopping app that allows consumers to earn gift cards and cash back across multiple retailers, is changing the face of consumer loyalty.
Wes Schroll, CEO and founder of Fetch Rewards, joined a recent episode of the “Unpacking the Digital Shelf” podcast, “Tapping into the Long Tail of Consumer Loyalty,” to share how his company is innovating customer loyalty programs to meaningfully connect brands and consumers.
Fetch Rewards launched in 2013 and has 13 million active users (the equivalent of more than 7 million U.S. households) on its platform. Schroll says the company captures more than $100 billion in sales on its app, amounting to $14,000 per household in spending.
If there’s any argument that consumers crave something different from loyalty programs, these figures make that case.
Schroll started Fetch Rewards based on an experience he had during his sophomore year at the University of Wisconsin-Madison, when he moved from a dorm into an apartment and had to do household shopping.
“It was always just amazing to me that every brand I was buying from and every retailer I was shopping at was telling me how much they cared about me as a consumer,” Schroll says. “They told me how much they cared about my loyalty, and then they would say, ‘here's all the hoops you can jump through if you want to actually get rewarded for it'."
Schroll’s experience opened his eyes to an opportunity to help brands and retailers reward customers for their loyalty in a better way.
“You have executives that are sitting around the table thinking, ‘How do we stand out? How do we generate more value or more revenue?’ But I think very few people actually put on the hat of the consumer. They're thinking of that brand — no matter how big that brand or retailer is — they're probably only thinking of [consumers] for a teeny fraction of a day,” Schroll says. “But if you really want to move the needle in the long-term, you have to talk to and tap into the long tail of consumers.”
According to Schroll, traditional loyalty programs focus on the top 20% of consumers, who often account for 80% of a company’s revenue. However, to really retain these customers, companies need to meet them where they are.
Fetch Rewards has created a platform that allows consumers to earn points on any receipt from any store or restaurant — and redeem points for gift cards and other rewards.
Consumers can even join clubs to earn more points, as well as receive special offers and other perks from leading brands. Hundreds of well-known brands and retailers are currently on the platform, including Starbucks, Lay’s, Pepsi, Sauve, and Huggies.
Fetch Rewards’ “any-brand, any-retailer” approach allows companies to engage consumers on a platform they’re already using on a daily basis. This often compels consumers to shift their behavior and purchase again from a brand or retailer if they like the rewards they receive.
Schroll says customers who upload their receipts are guaranteed to get rewarded every time. Fetch Rewards also uses the transactional data it captures to get consumers more rewards.
“We'll also utilize the information you're providing us to then go out there and advocate on your behalf,” Schroll says. “We will fetch you incremental value by going out there and talking with those brands or companies in the categories that we see you care about. We're going to get them to offer you incremental points for … retaining your current behavior — maybe shifting your current behavior just slightly or maybe trying something new that we think you'll be interested in — and we'll deliver you points for doing that.”
With Fetch Rewards, brands have an opportunity to both monetize and innovate their customer relationships by creating loyalty at scale.
Schroll says one of the main advantages the app offers is that brands get a holistic view of consumers — beyond their activity on one specific channel.
“You can now actually treat a household as a household, which means you're going to have a full picture [of] ROI. You're going to have a much more holistic message that's relevant to the consumer because you're treating them as their whole self and not just as what they do at any one place.” — Wes Schroll, CEO and Founder of Fetch Rewards
Along with this holistic view, Fetch Rewards can deliver a level of hyper-targeting that other rewards platforms likely can’t match.
“A brand can come to us and say, ‘We want to drive market share in this region by 2% and we're willing to do it at a profitability of X’,” Schroll says. “Then, our system will start rolling it out in different values — you might get a different offer than I get. The system is just understanding who our consumers are, understanding their price sensitivity, understanding when they go shopping, and deploying those dollars on behalf of that brand to achieve those objectives.”
Fetch Rewards is already driving results for brands. With $100 billion in annual transactions on its platform alone, the company provides a scale and potential audience that rivals many major retailers.
“At that type of scale, [there] is starting to be a fundamentally different conversation in the value we can provide to our manufacturers,” Schroll says. “If we help them win an extra 5% with our households, depending on the brand, that’s tens of millions of dollars of incremental sales that we're delivering for them.”
The company also solicits reviews from its users by rewarding them with points for rating a product. This gives brands validated proof points they can use on other platforms for a fraction of the overhead it would normally require to manage the review process.
Along with collecting transactional data, Fetch Rewards conducts customer surveys and uses other feedback mechanisms to talk directly to consumers. These insights are particularly valuable for informing a brand’s product design and development.
“For any partner out there who's considering launching new products, actively launching new products, and trying to optimize and expand, we offer a suite of different tools that can help them — from helping them gain sales and distribution to refining down the actual product, the flavor profile, the look and feel of it, all the way through to reviews — that entire lifecycle that really helps accelerate a product's expansion into a market,” Schroll says.
Fetch Rewards is helping brands establish a stronger one-to-one relationship with consumers and connect with them in a relevant way.
Rather than making it cumbersome for consumers to get something in return for their loyalty, Fetch Rewards is making the process seamless — helping brand manufacturers tap into the long tail of consumer loyalty.
For more insights into how to develop a customer-centric loyalty strategy, check out the rest of this episode of "Unpacking the Digital Shelf."
