Prodege is a customer acquisition giant and has quietly become one of the world’s largest non-social, non-search marketing channels. How? With brands like Swagbucks, MyPoints, ShopAtHome, CouponCause, and Shoply. VP of revenue and business development, Lenny Rabin, stopped by Retention Masterclass to talk about how a company with this kind of massive scale approaches retention by creating “Rewarding Moments” for over 120 million registered members worldwide.
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The retention magic of “Rewarding Moments”
Prodege finds itself at an interesting intersection in the consumer journey. “We sit in an interesting space where we are trying to create a rewarding moment for our members who are coming to our site, while at the same time satisfying an acquisition need for our advertising partners. And we’re sort of the middleman in the middle,” says Lenny. For Prodege, this means “we want consumers to have joyous and rewarding experiences when engaging with the brands that they would on a typical day-to-day basis, or when engaging with new brands and new services that they may not be familiar with, to create that positive interaction.”
So how does this emphasis on a great user experience translate to retention? As part of the acquisition team Lenny says, he often experiences “a disconnect between ‘I’m bringing a user to your product or service,’ and ‘It’s on you to retain that user wholesomely.’”
“And what we find [is important] to retain our users is obviously new content all the time and delivering on our promise,” says Lenny. “I think that delivering on the promise is the universal thing that’s really for all marketers.” As the middleman between brands and buyers, Prodege is in a unique position – they can create retention for their own products but have to rely on brands to satisfy customers after the purchase.
What brands are missing about customer retention
“Now, we can affect different tactics to encourage the best retention, but at the end of the day, we’re bringing someone over to your product and it’s really going to be on you to create that rewarding experience, that joyous occasion with that consumer to keep them retained,” says Lenny. As with many aspects of marketing, Lenny says, it’s all about being flexible.
“I think successful campaigns happen when you have an open mind and when you test different strategies and tactics to find the sweet spot for your cost per acquisition, coupled with an acceptable LTV.” He adds, “And I think that when you sort of go in single-mindedly, knowing what works on one channel and believing that that should be easily replicable across all other channels, you’re going to tend to have an issue, both on your CAC and on your LTV. “
Remember, each campaign is unique, and “the key to a successful campaign, is getting under the hood and finding what that [important] KPI is on an individual basis.”
The science of retention for games
Retention is closely tied to LTV and monetization, so it’s imperative that apps think about this holistically. That’s especially true for mobile gaming, where players are not all created equal – at least in terms of spending.
Lenny says, “we don’t talk about CPI.” Instead, he says, “We get under the hood with every advertiser,” and learn about the science of the game and what data tells us about when a user is most likely to spend money, and then we craft offers specifically for that scenario. So, if a game tells Prodege that it’s easier to get to Level 13 – at which point users are already addicted – so they might put a special offer at Level 15.
“We don’t actually message the user to spend money, we just tell them, ‘Play through Level 15 in order to get this award.’ And what we can do by doing that is command a much higher CAC or cost per engagement, and make the award for the user very meaningful,” says Lenny. “So users might be getting paid anywhere between 4,000 and 5,000 Swagbucks, to use our currency terminology, to get to Level 15 — which to the naked eye may sound trivial, may sound simple, may sound easy, but there’s really a lot of thought behind that specific level in the game.”
Delayed gratification for retention
The reality is that before you can retain users you have to acquire them and Prodege works with companies at all stages of development. “We work with some advertisers who are in a startup phase and are needing to show volume of registration or whatnot to get to the next stage, whether that be around the funding, whether that be releasing a new product or service,” says Lenny. “And in that case, we’re obviously gearing our campaigns to drive volume fast.”
When Prodege is in UA marketing mode, the team offers a “high award with a very low engagement point or low barrier to entry to get that user through the door and to achieve that KPI for that advertiser on that day.”
Alternatively, Lenny says, when his team is looking to drive longer-term retention, they delay the reward to keep the customer coming back.
“So delaying the award is really what we found works best and finding what makes the most sense to delay the award, but not too far. So, a 30-day delay is our general rule but sometimes we’ll go to 60,” Lenny says. “Sometimes we’ll use the copy to skew the members to do something that they may not need to in order to get the award. But it just sets the tone in their mind that this is not just about engaging today and leaving, it’s about a longer-term engagement.”
To learn more about the Prodege approach to retention, tune into the entire interview above or read the transcript below.
John Koetsier: What can 120 million members and $1.7 billion in cash rewards teach us about retention? Hello, and welcome to Retention Masterclass. My name is John Koetsier.
Peggy Anne Salz: And my name is Peggy Anne Salz, and we’re your co-hosts as always on this show.
John Koetsier: So, you’ve probably never heard of Prodege. But you’ve probably heard of Swagbucks, or MyPoints, ShopAtHome, CouponCause, or Shoply — pretty sure my wife uses Swagbucks — and a bunch of other different brands.
Peggy Anne Salz: And of course, now you know those names, right? So they are the brands from Prodege, which basically connects brands and consumers around coupons, cash rewards for buying or taking action on a company’s offer. So if you look at it that way, John, you would say that Prodege is a customer acquisition giant — maybe in the background — quietly, however, becoming one of the world’s largest non-social, non-search marketing channels.
John Koetsier: Absolutely.
Peggy Anne Salz: So it is big.
John Koetsier: Absolutely. I mean, that kind of scale is massive. And with that kind of scale, you think they would know a little bit about customer acquisition, which I think they do, and actually retention, which of course we’re going to get interested in, in this show.
Peggy Anne Salz: Absolutely, because that’s the fit, right? It’s about retention. They’re a customer acquisition giant, but if you acquire well, you have good retention. So yes, we’re going to chat with the company’s VP of revenue and business development, Lenny Rabin. Welcome to Retention Masterclass, Lenny! Great to have you.
Lenny Rabin: Thank you. Great to be here.
Peggy Anne Salz: So where are you based?
Lenny Rabin: I’m actually based in LA, in Redondo Beach.
Peggy Anne Salz: Okay. All right. So, we talked about your company, but I was looking at the website — “Create Rewarding Moments,” that sounds great. It reminds me of the “Magic Moments” from Forrester. They’re the “Magic Mobile Moments” later, you know, we come up with these big things, the moment, right? We had, John, you remember Ogilvy…
John Koetsier: Mm-hmm.
Peggy Anne Salz: …the magic moments there. So here it is, “Create Rewarding Moments” for over 120 million registered members worldwide. What does that mean? What do you do? What is that rewarding moment mean in there as well?
Lenny Rabin: Yeah. So it’s interesting that you asked that question, and I think you may have just touched on something very secretive because we’re about to release Magic Receipts.
Peggy Anne Salz: Oh!
Lenny Rabin: And so I did not tell you that before the show, so that’s first heard here, and we could talk more about that when that comes out.
But I think that our company set out on a mission to create rewarding moments for our members. And we sit in an interesting space where we are trying to create a rewarding moment for our members who are coming to our site, while at the same time satisfying an acquisition need for our advertising partners. And we’re sort of the middleman in the middle.
But the idea is that we want consumers to have joyous and rewarding experiences when engaging with the brands that they would on a typical day-to-day basis, or when engaging with new brands and new services that they may not be familiar with, to create that positive interaction.
John Koetsier: That is very cool. And I mean, I think Peggy and I might dig a little bit more about this Magic Moments or whatever you’re going to be releasing there. It’s breaking news on the podcast live right now … so, very cool. There’s obviously a customer acquisition component to what you’re doing and there’s a retention component. We care about both. I mean, you can’t retain customers if you never acquire them in the first place, right? But of course we focus a little bit more on the retention piece here.
What does customer retention look like to you, and how do you achieve it? What are the pieces, the perks that work? And how’s it work?
Lenny Rabin: Yeah. So I think, obviously we ourselves are marketers and need to retain our members. So we have a whole acquisition arm that’s going out there and buying, or doing referral programs and whatnot, and it’s our mission to retain our users also. And what we find to retain our users is obviously new content all the time and delivering on our promise. I think that delivering on the promise is the universal thing that’s really for all marketers.
And as the acquisition arm of things on my side, that’s what I encounter a lot, is a disconnect between ‘I’m bringing a user to your product or service,’ and ‘It’s on you to retain that user wholesomely.’
Now, we can affect different tactics to encourage the best retention, but at the end of the day, we’re bringing someone over to your product and it’s really going to be on you to create that rewarding experience, that joyous occasion with that consumer to keep them retained.
John Koetsier: So, it’s kind of funny, we talked about this pre-show — we’re recording this, we’re actually broadcasting this the day after the debates in the U.S., the political debates — and I kind of feel like we’re doing it wrong. I mean, we’re not talking all at the same time. We didn’t learn the lesson yet… [crosstalk]
Lenny Rabin: Well we can start doing that right now, I mean, you know… [laughter]
John Koetsier: Okay. We learned it a little bit. Excellent. One little follow-up there, you obviously are core to what a lot of marketers use and do for acquisition and retention.
What do you find in your experience that marketers fail to understand about customer retention?
Lenny Rabin: I think what they fail to — it’s not necessarily about customer retention — I think they fail to understand that not every campaign is going to work exactly as planned out and not every result is going to work exactly as hoped for.
And that’s where I think there’s a lot of testing needed.
I think successful campaigns happen when you have an open mind and when you test different strategies and tactics to find the sweet spot for your cost per acquisition, coupled with a[n] acceptable LTV.
And I think that when you sort of go in single mindedly, knowing what works on one channel and believing that that should be easily replicable across all other channels, you’re going to tend to have an issue, both on your CAC and on your LTV.
Peggy Anne Salz: Now you talk about understanding what you need to know, what you need to expect. Lots of examples there, but you also work with a lot of really cool brands. I was looking at these, you know, Hefty, Kraft, driving sales of their products in store, app marketers even, engaging a fintech, Stash, increasing the number of new users who are making a first-time investment.
So, there’s a number of different verticals you’re working with, a number of different critical events that you’re trying to — I wouldn’t say push — I would say encourage, there you go. And there’s going to be differences, there’s going to be also similarities. What are they across verticals or across campaign goals?
Lenny Rabin: Yeah. So that’s a great question, and I think I always go back to — I don’t have an exact count, but I think I’m at about 10,000 campaigns that I’ve worked on…
John Koetsier: Wow.
Lenny Rabin: … in this role. So to your point, Peggy, there’s a lot of different KPIs that I’ve heard and worked on in my time. I think that they all have one similarity, which is there is a KPI which an advertiser’s buying for.
And that’s really the key to a successful campaign, is getting under the hood and finding what that KPI is on an individual basis.
The beauty is that the consumers we have are open to these messages. They’re open to trying new products and services, and they rely on our promise of the reward that we promised them to be delivered accordingly. And if we can find the correct KPI that makes the most sense, and we can assess an award that is meaningful enough to a user to get them to engage with, or change a habit if you will, then we can usually run a successful campaign.
Whether that be a mobile app, a subscription box, a direct-to-consumer type service, a[n] in-store marketing campaign, it really runs the gamut. That part really stays the same.
Peggy Anne Salz: Mm-hmm.
John Koetsier: 10,000 campaigns … did I hear you say 10,000 campaigns? And he still has more hair than I do.
Lenny Rabin: Oh, no, this is actually a scam. My sister was laughing at me this morning, she’s like, ‘You’re covering up everything here.’ I’m like ‘Yeah.’
John Koetsier: Haha, it’s all good dude. You’re winning.
Lenny Rabin: But my beard’s getting white. The nice thing is that it’s red so it’s harder to see it you know…
Peggy Anne Salz: So they run the gamut. I mean, 10,000, that’s a ton. And I have to say that the reason we’ve connected is I’m looking at gaming, John, right?
So I do also write for Pocket Gamer, and I’m looking at rewarded advertising because that’s the way to get people into games. Because everyone out there is saying, App Annie included, you know, ‘We’re having a great time in games,’ but we’re going to see wallets will be depressed, in-app purchases — I wouldn’t say they would plummet, but you have to diversify, right? And you are also working with gaming companies as well as the brands we just discussed, Lenny. And you’re working with different approaches, you’re a little bit experimental.
One you were using that I came together with you on was Adjoe, right? So they’re not just rewarding people for watching a video, they’re rewarding people for playing the game of the advertiser. The point is there’s a lot of experimentation going on out there, right? I’d love to hear from you what you make of these different models, because it may be that gaming is, we’re going to see is exploding.
You’ll get another 10,000 in a very short period of time…
John Koetsier: 20,000.
Peggy Anne Salz: … because of this. Who knows? Yeah.
Lenny Rabin: Then I’ll lose my hair. [laughter]
Peggy Anne Salz: Okay.
Lenny Rabin: So, ironically, or I don’t know if ironically, but we actually have seen a lot of success in the gaming sector specifically. I mean, building up to COVID for sure, but definitely after COVID began. And that was actually a hunch I had back in April when we had an emergency meeting, like every company did, to figure out how we were going to fare through this uncertain time.
I put out a theory that we would actually fare very well specifically in the gaming sector because people were stuck at home, and this was like prime opportunity for us to get games into their hands. I myself, personally, I can tell you, I had one screen on my iPhone. There was no scrolling of apps. I have everything in folders and that was it.
And over the past six months I have three more screens and they’re all games, and I’ve never played a game on my phone before COVID. So …
Peggy Anne Salz: Whoa.
Lenny Rabin: … definitely a lot of what I’m doing, and the focus in gaming had got me to start downloading them. But where I used to download and delete them, now I actually play them. And I myself am guilty of spending quite a bit of money on some games as well, namely the gambling ones, and that’s because Vegas is closed.
But I think that the members and the consumers themselves are in a similar situation where, you know, boredom sets in and if you’re not going to read a book, and you’ve gone through the whole Netflix, you need something to keep you entertained.
And we were positioned well in a way where we don’t award for a video. We don’t award for something that’s not meaningful for an advertiser.
We work with our advertisers, again, back to my earlier message, to find a KPI that’s meaningful. And in the gaming space, it’s pretty clear that a meaningful KPI would be — you know, all games, what I’ve noticed is they sort of make it easy at the beginning and you could get by without buying credits or you could get by, by your own skill, and as time goes on it gets harder and harder and harder.
And I was surprised to see this, I’m playing this bubble shooter game. I’m surprised to see this myself — I’m at Level like 300 and I can still get through the levels without paying. But how they’ve figured out how to monetize a guy like me to shoot bubbles is incredible, because you just want to pass the level, but they give you one turn too short and they’re like, ‘Hey, but if you pay $2.99 we’ll give you a thousand extra turns,’ and you’re like uh, do it/not do it.
So they all have a monetization point, and if we can put the reward at a place where probably a user would have needed or been convinced to spend the money…
John Koetsier: Mm-hmm.
Peggy Anne Salz: Mm-hmm.
Lenny Rabin: … not only is the user addicted to the game now, so you’re going to have that retention — bringing it back to this retention topic — you’re going to have that retention because they’re not just going to go through all that effort, get hooked on a game, pay the money to get an award, and move on. They’re actually going to pay the money and then they’re going to continue to play, and they’ll probably run out of money or credits and continue to spend more and more money.
I don’t want to say how much I spent in June on huge games.
And that’s really the point, is what we do is we don’t talk about CPI. We don’t talk about a CP for registration.
We get under the hood with every advertiser and say, ‘Okay, at what level in the game — you know your game really well, you guys have science built around this whole platform that you’ve built in this machine, and there’s AI in there that tells you when you’re going to be best suited to get the user to spend money how many levels in — let’s get them past that level.
So, in one game might be Level 13 and it might be really easy to get there. It might take a day and then that game is so addicting that they know that you’re going to spend money at this point. Then we’ll put the conversion point at pass Level 15, so only a few levels later, knowing that you’re going to end up spending money.
We don’t actually message the user to spend money, we just tell them, ‘Play through Level 15 in order to get this award.’ And what we can do by doing that is command a much higher CAC or cost per engagement, and make the award for the user very meaningful. So users might be getting paid anywhere between 4,000 and 5,000 Swagbucks, to use our currency terminology, to get to Level 15 — which to the naked eye may sound trivial, may sound simple, may sound easy, but there’s really a lot of thought behind that specific level in the game.
Another game may be Level 100 and it could take two or three weeks to get there, but that game knows that at that point that’s when the user sticks, and that’s when they’re going to make that transaction, and that’s when they could pay out for it. So when they pay us high CPAs, we know when we’re setting it up in a way where these users are going to end up spending that money with the advertiser tenfold and it’s obviously a very worth it acquisition for that advertiser.
John Koetsier: It’s really, really interesting to me that you’re not just working with major brands, consumer packaged goods, but also games … mobile games, casual games, hyper casual games. I mean, that’s the real gamut right there. It’s pretty impressive. I mean, brand campaigns, and performance campaigns, and mobile marketing as well. Really, really interesting. It’s also …
Lenny Rabin: If you — sorry, if you go back to our Creating Rewarding Moments — if you think about it, our job is really defined. We don’t work with a CPG or with games. We work to find opportunities for our members to have rewarding moments.
So we follow sort of the industry trends and say, okay, games seems to be spending money and looking for new users, is this something that our members would engage with and that we can offer them a chance to earn more points? When you talk about CPG, we look at it and we say, okay, this seems to be an area where receipts are something that users are willing to upload to us.
We have technology, we have the members, is there something we can offer to the CPG brands to say, hey, we can drive you new purchasers and at the same time create a new “create rewarding moments” mantra for our members? And that’s why you sort of see the creating of the gamut from the fintech to the gaming, to wherever we can create a rewarding moment we’re going to try to do that.
John Koetsier: Nice.
Peggy Anne Salz: You’re hinting on your … you know, on our scoop here about the receipts? Or …
Lenny Rabin: Oh.
Peggy Anne Salz: I heard that word. I’m just, sorry.
Lenny Rabin: We can sidebar into the receipts. I mean, the general idea is — so Shoply, you mentioned Shoply is one of our brands, and Shoply is really focused on the CPG and on driving users through an in-store experience where they can find different products that they buy in the supermarket on a daily basis, and upload a receipt and get some points for that.
So, we’re toying with the idea of going with a name of Magic Receipts as something more appealing to the user base. There’s a lot more behind that that I can’t share right now, but that’s the teaser that I’ll put out there…
Peggy Anne Salz: Alright.
Lenny Rabin: … and Magic Receipts, meaning you upload a receipt and magically you get some points.
Peggy Anne Salz: I’ll go for it.
John Koetsier: Excellent. Want to talk a little bit about models. How do you approach marketing differently for new users or new customers? Or you know, just the full on customer acquisition point of view? Or marketing for you want a long term relationship? What are the key differences that you see there?
Lenny Rabin: So, it really goes to the conversations that we have with our advertisers. We work with some advertisers who are in a startup phase and are needing to show volume of registration or whatnot to get to the next stage, whether that be around the funding, whether that be releasing a new product or service. And in that case, we’re obviously gearing our campaigns to drive volume fast.
Usually that looks like a high award with a very low engagement point or low barrier to entry to get that user through the door and to achieve that KPI for that advertiser on that day. If we’re looking at something like longer term retention, what we generally do is we find out, you know, as far as we can to we can delay the award.
So delaying the award is really what we found works best and finding what makes the most sense to delay the award, but not too far. So, a 30-day delay is our general rule but sometimes we’ll go to 60. Sometimes we’ll use the copy to skew the members to do something that they may not need to in order to get the award. But it just sets the tone in their mind that this is not just about engaging today and leaving, it’s about a longer term engagement.
So, a classic example of that would be like a HelloFresh box that we asked the users to, say, subscribe for at least two deliveries. And that could be either a week or two, or that could be a month or two, depending on what their settings for that is. And so, and we find that generally, using the marketing message to talk about what we want them to do and the frame of mind we want to put them in, generally gets us to that sort of more retention-type engagement that we’re looking for, for the advertiser.
John Koetsier: Really, really interesting. There’s some companies, obviously, many companies that run an internal loyalty or rewards program. You’re obviously kind of a layer of rewards and loyalty across multiple verticals and multiple companies. How do the two compare?
Lenny Rabin: Yeah, I think that we sort of take on another role in the rewards space. I think that the rewards internally, and for me personally, obviously Starbucks is probably the best example of the loyalty that they have. For me personally, that’s the one that I can feel the ongoing relationship with them. But, what gets me involved in their rewards program or with their company to begin with. What sets that tone. And I think that creating trust with a brand is very crucial.
And we sit in a place where we have established trust with these 120 million members that when we tell them we’re going to give them an award for doing something, they’re actually going to get it. So if you’re not familiar with a brand, you may need something to encourage you to engage with that brand and become their customer, whatever that may look like. And then once the brand has created the joyous moment, once the brand has started creating that level of trust, their rewards program is more well received and can actually have an impact.
But on day one, when you sign up for a brand and they tell you about a rewards program, you generally are not gonna be like, great, I want a rewards program. You’re like, I want a product. So it doesn’t really help for much, and I think also internal rewards programs take on all different shapes and sizes. You know, for example, I don’t know how many of you go to — you don’t have Rite Aid there, but in the U.S. we have Rite Aid and they have my phone number, and I put my phone number in every time and I get nothing for it. So I’m not exactly sure what the rewards program is there…
John Koetsier: I hate giving my phone number. I generally refuse.
Lenny Rabin: Yeah. So, I mean, but then on the flip side, when I go to Vons I put my phone number in and it doesn’t do me anything at Vons, but when I go to the Shell station and I put my phone number in I get [a] discount on my gas. So I’m happy with that.
But again, it’s about, you know, if Vons wanted to get a new consumer to buy their groceries online, right? No, save 5 cents at Shell is not really gonna create that change of habit, whereas, hey, you can earn 5,000 Swagbucks today if you put in your grocery order for a minimum of $100 at Vons online and get it delivered to your house or pick it up in store. That’s a change of habit. There we’re giving the user something meaningful to be like, hold on a second … I never thought about doing this. This could be cool. Let me try this out. If everything checks out and it works out well for me, I may do this for a long time. If I don’t like the service that I get, if I don’t like the products that get delivered, if the bananas are rotten, if the meat is no good, I’m probably not going to continue.
So, that’s where you see sort of the two colliding and it’s not just about, oh, well you gave an award so this user’s not coming back. No, there’s a lot of things that could go wrong through the funnel of the actual advertiser, where it’s on them to create that experience. Once they do create a positive experience, yes, a rewards program is very much accepted by them because then it’s like, okay, how do I keep this user?
Well, keep them by A: continuing to deliver on your promise and doing a good service, and B: is maybe your rewards program resonates more and they’ll stick with you instead of being incentivized to try out Albertsons or Ralphs or another grocery store, in that example.
John Koetsier: Mm-hmm.
Peggy Anne Salz: So I do want to get to best practice in a moment, but I just want to step back because we’re talking about things like, for example, 30 days or 60 days, you know, there’s a lot around the rewards to understand. And it’s not just when you deliver, but how you deliver, you know, and you’re talking about, oh, do it in-store, but there’s also push, there’s email, tons of channels. What have you seen is maybe more effective, maybe the first point of engagement or the rules of engagement. Do you have something you can share there?
Lenny Rabin: I think that no user is created equally, and our recommendation is to use all mediums of promotion to inform the users that there’s a promotion going on that they may be interested in.
Peggy Anne Salz: Mm-hmm.
Lenny Rabin: I think I was going to get to this later, but we have a number of different channels, so to speak, where users can engage. So, just to back up for a second, you know, Prodege as a B2B company focuses on surveys. So we work with the market research world to bring surveys to our consumers and they can answer to that. Our cash back shopping, so we work with affiliate shopping on giving cash back for shopping online. Our performance marketing area where we work with all types of brands, like a lot of what we’re talking about today. And then our video channel which is playlist driven. And then finally our in-store shopper marketing, which may sound a little bit misleading — hence the Magic Receipt conversation — but it’s actually all digital marketing, but you only get the award once you go into a store and make a purchase and upload a physical receipt.
So we’re not actually going into stores and buying media or advertising in the stores. It’s all online.
So, what we do is we use email, desktop, mobile, push notifications, all these different mediums to let our users know that there’s a promotion going on that they may be interested in. Obviously there’s a lot of mechanics that go into what gets shown when and how, part of the secret sauce — or as my colleague calls it “inside baseball” — so I can’t give that all out on the show, but…
John Koetsier: Wouldn’t want to be the Houston Astros.
Lenny Rabin: So, but it’s interesting because using all of these mediums really works. There’s not one necessarily that works best.
What we found is by following the trail, actually a lot of times people will see things on email and then they’ll table that and come back and search for it on the site and convert there. People will see it on their mobile phone at 5 o’clock in the afternoon, come back at 9 o’clock and click on an email that they got, and engage with it. So, it’s really what we call a digital omnichannel in our language where, you know, it’s all the touch points really work best.If we try to just promote in one place we generally don’t see the same engagement that we’re looking for.
Also, what it helps for is, and just to keep it quick…
John Koetsier: I just had to put this up here. I’m sorry. I just had to put this up. I saw this from Marketing Cartoonist recently, and it’s what marketing touchpoint drove the sale? And it was nah, was it the ad? Was it the link on a keyword? Was it the dancing tweet of cats or B-list celebrity or something like that? I just saw this briefly and had to throw this up. I love it.
Lenny Rabin: Yeah.
Peggy Anne Salz: Awesome.
Lenny Rabin: It’s a very, no, it’s a very good illustration because it’s something I deal with on a constant, where are the versions coming from and why should we do an email, and why should we pay for that if we could just get it from here, and … you gotta go from all angles, you know?
John Koetsier: Yeah, yeah, exactly. Sorry about that. I interrupted you. Go ahead.
Lenny Rabin: I forgot what I was gonna say. Probably wasn’t that important.
John Koetsier: That worked out perfectly, then we learned something from the debates last night. That’s awesome. [laughter]
Lenny Rabin: Interrupted. Throw him off.
John Koetsier: Exactly! Throw him off and get your own words in edgewise. I’m going to ask about mistakes. And we learn a lot from our mistakes. We learn more sometimes from our mistakes than what we do right. So we want to hear, so what are some of the mistakes you’ve made that taught you a lot?
Lenny Rabin: Well, 10,000 campaigns is a lot of mistakes and a lot of learning.
I would say probably the two biggest learning lessons that I don’t know continue to be the biggest ones, but have really shaped our model and our process, and how we continue to be successful, is first: client expectations.
So making sure that there are frank and open and clear conversations to set the expectations properly so that you set up the campaign to begin with on a basis of what we’re looking to accomplish, versus just assuming that we know what they want based off of an email and going live, and finding out later that that wasn’t the case.
But the second one is more around fraud.
Obviously, you know, when you’re rewarding users to do something, you run the risk of all types of fraudulent activity. I think fraud’s a very big word. We actually call it the “F-word” at our company. So, there’s so many different ways to look at it, but really what we’re trying to avoid is users gaming the system in any way, and driving a real person at a real address with a real credit card to do a real action.
And over the years, I think most of the mistakes that have happened have been on that end, and we’ve used many an example to just continue to iterate on that process and make sure that we’re doing the best job that we can. A lot of that is what we do with the delayed awards to ensure that if someone does get through the door, we have a means to mitigate that or revoke those points so they don’t just make off with it. A lot of it is a lot of the retention things we spoke about. So, telling users to stay on for longer than we may actually want them to or need them to. I should say a lot of that is just our compliance team and making sure that we’re keeping a good eye on all the systems at all times, and closing out bad apples, international apples.
One of the biggest things that we’ve implemented that have worked really well is our two-step verification.
So, if you’re a new user, you have to verify your account with your phone number — so, John, I don’t think you’ll do good on our site — and that basically stops users from being able to create multiple accounts and doing it multiple times. So they may be able to get through the door one time, but what we’ve really done is mitigated a lot of the mass fraud that we would be seeing years ago where, you know, users can create multiple accounts, or bot farms, or all these other things. So that’s really where our learnings have come.
And I’ve said to our advertisers over the years many times, like, look, at the end of the day, I want to drive you good traffic as best as I can. Obviously there’s a rewards component to it and that you understand the risk when getting into this, but this is a group effort. So, when you encounter something that’s bad with our system, I need you to help me out there because not only is it going to help your future campaigns, but it’s also going to help the ecosystem of other advertisers.
So, collectively taking all of the information that we get, we’re able to close down bad users from one account they’ve stopped from going to other accounts. And we work together to continue to fine tune the system and make sure that we’re doing the best that we can. But I would say that when you’re working with rewarded advertising, your biggest concern is going to be fraudulent activity, however you translate that. And our key to success in the rewarded space has been addressing that head-on and making that a very serious topic and an issue at our company.
Peggy Anne Salz: So you’ve found ways to fight fraud, right? And you head up discovery, you know, discover in your business. I’d be interested in understanding more about like the cool models. You know, you’re out there experimenting, right, Lenny? You’re doing some models in gaming, that’s how we came together in the first place. Maybe you want to talk about that model or other models, something that has surprised you or just blown you away.
Lenny Rabin: Yeah. So, the discover side of our site is a consumer facing name, which basically means discover new brands and services. On the B2B side, we would call that the performance marketing division. We obviously experiment with different models because we have different KPIs to drive to. So I think that I would say the DoorDash coming to us with a driver campaign was a pretty tricky one. I wasn’t sure how that would work out. They needed new users to drive for them so they can shore up their fleet. And in working with them, we found a sweet spot of a CPA — it was pretty high, and an award that was pretty high. And we actually were able to drive them about a thousand new users, Prodege users, who took their first drive on a monthly basis for about a year and a half strong.
And we did some surveying around our users to understand like, this is a — you’re gonna make money doing DoorDash, what do you need us for? Like, what’s holding you back from doing this type of activity? Like you’re here, you’re on our site to make more money, so clearly you’re the type of user who would want to shore up your income by doing DoorDash.
And the concerns that we saw were things around their maintenance on their car, is the gas mileage going to back out, safety going to strangers’ homes, ease of using the app … so many different things that just stopped users in their tracks were like, nah, this is, you know, sounds good, but not for me.
John Koetsier: Mm-hmm.
Lenny Rabin: But then when offering them an award, again, going back to that sort of bringing them over the gate and — or bringing them over the hill when offering them that award — they looked at us and said, ‘Okay, you probably understand our concerns. You understand the hesitations that we have and we’re gonna, you know, we’ll engage with this and test it out based off of that award.’
So that was one of the coolest, one of the cooler or surprising models I would say that I’ve seen work really well by just using a little bit of strategic thinking. And again, it goes back to the point where we could have easily driven people to sign up or apply to drive, and they would have gotten a lot of volume of that, but is that meaningful.
But getting them all the way past that first drive, past the point where they get paid, where they put their bank account information and where they have the driver app downloaded, where they have to go through the vetting process … now they’re a driver. So now it’s really on DoorDash to keep them retained and to keep them driving for them and make that acquisition back out for them.
John Koetsier: That is really interesting. That is amazing. I mean, that’s not just shoveling leads over to somebody, that’s just not shoveling names over to somebody. That’s actually sending them a customer, or in that case a driver, somebody who’s critical to their business. That’s pretty impressive.
Now we have limited time left, but I know you wanted to share something about the holidays that are coming up, and this is going to be a very, very interesting holiday season. I mean, we’ve gone through COVID, we’re going to be going through COVID for some time, and a lot of companies are in tough spots. They’re going to be looking to the holidays to do well for them. You’ve done some surveying and some research on this. What have you found?
Lenny Rabin: Yeah. So actually it’s not me. I can’t take the credit for this. I’m going to give a shout out to the Prodege market research team and the Prodege marketing team for putting together this study.
We actually started tracking consumer habits at the beginning of COVID. We had a weekly survey go out to the same consumers asking them a set of questions to sort of track their change of habits, their feelings, and things like that. And so we did something around — we do something around the holidays to understand what’s important to users during this time.
To your point, this year is going to be very different. I think a lot of — more is going to shift online, but folks are still going to be wanting to go into stores.
I think the biggest takeaway, or the biggest two takeaways I should say, is that making me feel special is important to the consumers, and also safety in the store. So, you know, and we can show this about what makes people feel special, creating those joyous moments, making the store experience not only elevated but also safe. And then special discounts and considerations for the time that we’re in, which is like creating appointments to be able to talk to a specific representative or virtual shopping.
But I think that when an advertiser or a marketer is thinking about going through this Q4, you have to take into account the lower spend that’s going to happen. Which is natural. Take into account that the more exciting and joyous you can create that experience for a consumer, you’ll probably be more successful in taking away market share from a competitor.
Understanding that safety is a top concern, so even if you don’t believe in it that much, putting that out there to the consumers making them feel like you thought about this and that you gave special consideration to the times will definitely bode very well for you. And freebies — people love freebies, you know, make it the buy one/get one free, or free gifts, or whatever it might be that you can add to create that experience.
And really use this time to make people happier and to create a joy in what’s generally a very special time when people are visiting family, when people are spending, giving out gifts, and celebrating. You know, this year it’s going to be different. People are going to be all on Zoom, and how can retailers take a part in creating that happiness? Just to go back to the debate. I remember last night before the debate, everyone was telling me, ‘Well, you know, we could really use some good entertainment.’ And I think that rings true, it’s like, that was some good entertainment, and now it’s about how do we, how do retailers play a role in creating a joyous and happy holiday season to the best that they can, in these unprecedented times?
Peggy Anne Salz: Well, that is excellent, Lenny. I’m so glad you shared that. I love the interplay between rewards and retention. That’s something we’ll be hearing about more, thinking about more, learning probably a lot from you. You know, maybe we’ll have you back when you have your scoop, who knows.
But in the meantime, I just want to thank you for sharing that, for sharing your insights, great examples, and above all, understanding. I think that’s inspiring, John, right? It’s not just the discounts. It’s not just the money off, because that’s not going to cut it. It has to be about experience, and that’s good news in COVID, I think, for retailers and companies as well, because it’s about an experience you can think about that, maybe without a huge budget as well. So thanks, Lenny, for sharing that.
John Koetsier: Thank you, Lenny.
Lenny Rabin: No, thank you guys for having me. Much appreciated and glad we were able to do this.
John Koetsier: I’m super glad we’re able to do this as well. And for everybody else who’s watching or listening later on, whatever platform you’re on, hey, like, subscribe, share, comment, all the above. If you love the podcast, rate it, review it, that’d be a super help for Peggy and myself.
Peggy Anne Salz: Absolutely. We’re going weekly. It’s just around the corner, John.
John Koetsier: Yes.
Peggy Anne Salz: Just around the corner.
Lenny Rabin: Am I back next week? [laughter]
John Koetsier: I don’t know. Do you want to be?
Peggy Anne Salz: We were going to save the best for last here, Lenny. You’re coming back. No, I’m just kidding. But absolutely, we’re back weekly in October. So until then, hey, that’s a wrap for this one. Until next time of course … keep well, stay safe. This is Peggy Anne Salz signing off for Retention Masterclass
John Koetsier: Excellent. And I’m John Koetsier. Have a wonderful day!