Germany-based loyalty program leader, Payback, is aiming at increasing its redemption level to over 90 per cent in the India market. “Our goal is to reach that level in 3 years,” said company CEO and managing director for India operations, Vijay Bobba.
In India, around 35 to 40 per cent of the loyalty points that are given by Payback to its members is redeemed, while in Germany, about 95 per cent of the points given by Payback are redeemed. The volume is expected to go up once the process of redemption becomes easier and more partners sign up.
The company did not give a specific figure for the investment required to meet the goal of raising the redemption bar. But, executives indicated that investment was necessary for installing self-service kiosks at every point of sale, to reach the target number. The kiosks that could be used to scan loyalty cards and print coupons, would cost anything between $5,000 and $6,000 (Rs 2,25,000 to Rs 2,70,000) each. Payback covers close to 3,000 partner outlets currently.
Payback operates in Germany, Poland, and India. It is looking at opportunities in other countries as well. The company entered India in June 2010 through a strategic investment in i-mint, an entrepreneurial venture. It had launched in Germany in 2000. Around 35 million customers use Payback cards in Germany. The European members generate $21 billion annual sales with cards at partner stores.
In India, transaction throughput via Payback is around $350 million (Rs 1,500 crore to Rs 1,600 crore) every month. However, the transaction level is expected to go up substantially once its tie up with the Future Group goes live by September-end. At present, it has online and brick and mortar partners, including HPCL, ICICI Bank, MakemyTrip.com, Megamart, Music World, UniverCell, Bookmyshow.com and FernsnPetals.com.
Payback, through its parent Loyalty Partner, holds a majority stake in payback India. Loyalty Partner is a subsidiary of the American Express.
