Europe’s leading bonus card services provider, Payback, together with Peepul Capital, has recently acquired a majority stake in India’s largest loyalty card provider – i-mint. Alexander Rittweger, founder CEO of Payback, talks to IndiaRetailing about his plans to foray into the Indian market.
How much stake does Payback have in i-mint? What role will PE player Peepul Capital have in the company?
Together with Peepul Capital, we have an 86 per cent stake in i-mint. Though we are an expert in coalition programmes, Indian culture is quite different from Germany’s. Peepul Capital will help us understand the Indian market and the needs of retailers here.
What is the core business model of Payback? Can you tell us about your clientele?Payback, the card business arm of Germany-based Loyalty Partner, provides loyalty management solutions through the Payback bonus scheme. With 24.6 million active cardholders in Germany and Poland, Payback is Europe’s leading bonus scheme.
Customers can collect points from a total of 340 well-known companies in-store and online and redeem these for vouchers, rewards or Lufthansa miles or donate them to aid projects. The very high redemption rate – 90 per cent – shows how relevant the scheme, its redemption channels and partner companies are for customers. We have a number of retailers, such as Carrefour, Metro Group’s food segment, iTunes, eBay and Amazon, among others, as our partners.
How does Payback plan to benefit from its association with i-mint?
The most difficult part in a multi-partner loyalty is to get the coalition together. When you acquire a company, you are sure of one thing that you are acquiring its clients as well. i-mint has done a phenomenal job in the coalition programme domain and from now onwards, i-mint loyalty programmes are our programmes.
Will i-mint see a rebranding?
i-mint is a good brand. Rebranding is part of our project plan, but nothing is certain as of now. Let us first research on how people react to its rebranding.
The redemption rate in India is much less than that in the European market. How do you see the market maturing in the coming years?
The redemption rate in Germany is 93 per cent, which is quite remarkable and we are proud of it. We are aware of India’s low redemption rate and will do intensive marketing and reach out to customers to create our niche in India. Although we cannot say how long it will take for the Indian market to mature for coalition programmes, there is a huge potential for it and we will tap it.
After the slowdown, even Indian retailers have understood the importance of customer relationship management, so we are really optimistic about the growth of the loyalty programme market here.
In India, modern retail is less than 10 per cent. In developed economies, though, this percentage is much higher; for instance, 85 per cent in America. But, India will witness a retail boom soon and that will automatically benefit us.
i-mint has its own proposition for the Indian consumer. Are you adding anything of your own to it?
What we will bring as an add-on to Indian consumers will be a lot more offers on redemption. We want to tie-up with more number of retailers and grow our partner base. Consumers should expect quite a strong evolution from us, if not revolution.
What level of technical expertise or capability is required to run a good loyalty programme?
To run a good programme, you need good accounts management, a good call centre and an efficient IT set-up. It is also very important to give a differentiated experience to the customer.
How important is the Indian market for Payback?
We are quite enthusiastic about it. We have done enough market research here and are betting big on India.
