Interview: Leslie McNamara Citi Retail ServicesPrevious Article
Amazon, Starbucks imagine new options for customer loyaltyNext Article

Independent and unbiased insight on customer loyalty and data-driven marketing

CEO Interview with Peter Vogel

Line Spacing+- AFont Size+- Print This Article
CEO Interview with Peter Vogel
Related Articles

As the league of digital loyalty players expands almost weekly, it can be a challenge to stay on top of all the emerging competitors. My solution to stay out front is to go straight to the source, and I was fortunate to get a few minutes with Plink CEO and Founder Peter Vogel to learn more about his rapidly expanding company.

Plink is a merchant funded rewards program launched in January 2012 which links national offline merchants with online consumers through a registered card model. Plink has grown rapidly, building both a large merchant network and strong consumer following.

The founders of Plink have roots in Adperio, an interactive agency working at the time for Netflix, Discover Card and other big brands. Adperio earned its success by referring massive numbers of people on FarmVille and other online gaming sites to open trial accounts at Netflix, in the process becoming the biggest source of new customers for the online media provider.

The kernel of the idea for Plink grew from this early online success. As Peter shared, “if it was possible to stimulate significant referral business between online players and e-commerce sites, why not extend the model to link online fanatics to offline brands?”

Plink began building its merchant network in the restaurant business with Taco Bell, Dunkin’ Donuts, Red Robin, and Outback Steakhouse. Today there are more than 50,000 locations across 15 – 20 national brands in the network nationwide. As they continue to grow, Plink will focus on national merchants and does not plan to extend into local retail markets. The program gets the most traction among consumers between 20 – 30 years of age and so far, growing the customer groups has not been a challenge.

If you ask Plink to describe what it has created, they might tell you they have perfected the art of moving large groups of consumers to brands carefully matched to their interests. Or they might say that they have taken the traditional affiliate model to an entirely new level. One thing they won’t say is that they want to be someone else’s loyalty program.

To draw some industry comparisons, the system is similar to Belly, Perka, or LevelUp as it maintains its own membership base. Plink focuses on driving share shift and other financial objectives for its clients, but stops short of substituting its structure for a client loyalty program.

Merchants are happy to contribute up to 10% in rewards funding based on Plink’s pay for performance model. Merchants are able to structure their rewards to meet their needs. White table cloth restaurants might offers 8%, while gas and grocery ring in at 1-2%. Multi-line department stores Macy’s and Nordstrom go as high as 10-12%. Of the amount contributed by the retailers, about 50-75% is allocated towards customer rewards, establishing a perceived payback for most Plink members between 5-10%.

Plink offers an advantage to its partners based on the data it collects, and can demonstrate a return on investment via share shift between brands in the same category. To protect this model, Plink is willing to grant exclusivity in some retail categories.

Early on, Plink rewards centered on Facebook credits. This catered to the core audience of online gamers, but this group wanted more, saying “I don’t always want FB credits”. As Plink has evolved, it has opened up the reward choices to gift cards issued by national merchants. Over 25 – 30 brands participate with the most popular choices including Walmart, Target, Amazon, Starbucks, and Apple.

Peter acknowledged that some loyalty programs built on a registered card model have experienced slow enrollment rates as customers evaluate the risk and reward of entering credit card information online. Plink has overcome this potential obstacle by making enrollment seamless and by focusing on groups of consumers considered to be digital natives.

Looking into the future, Vogel said that sorting out the legion of digital loyalty players will not be easy task. He predicted “there will be natural attrition in the offer space” and emphasized that he “would rather invest his energy growing the list of merchant locations accepting Plink.” He hopes to add 1-2 brands each month and reach 100,000 locations by end of 2013. Recently Old Navy, 1-800, and travel brands AA and Holiday Inn have joined. The recent launch of the Plink mobile app is evidence of continuing development.

Plink is building a sustainable long term model, though Peter admits other groups might form similar networks based around member groups with distinct characteristics. The main value Plink emphasizes to its retail partners is that customers who are Plink members always pay full price and still get rewarded.

As opposed to other digital loyalty players which focus on daily deals, Plink is not teaching people to shop for deals and only buy when the product is 50% off. Vogel stated that “Plink does not devalue the products of its partners and prefers to help them elevate their brands through added value offers.”


Featured Posts

Loyalty Truth Reboot – what does the future hold?

Loyalty Truth Reboot – what does the future hold?

It has been a while since I have posted here on a regular basis. I wanted to share an update with you and reconnect with a fresh perspective. The original inspiration: I [...]

Become a Loyalty Truth Insider!

Want to get connected with some of the best minds in customer loyalty? As an “Insider”, you’ll benefit from powerful information framed with a practitioner’s perspective. You can expect a bi-monthly summary of some of our most compelling posts and sharp reads from other sources, combined around a theme to provide insights on trends and hot topics in the market.
  • This field is for validation purposes and should be left unchanged.

Event Calendar for Loyalty Marketers