Anthony Seymour-Walsh: We are regularly seeing north of 20% given back to customers. I'm one of those loyalty point gamers that just loves and does everything that those programs sort of ask me to do, ensuring that there's a level of friction without compromising the purchase experience that helps all parties understand the value that's being created. Welcome to Add to Cart, Australia's leading
[Voiceover]: e commerce podcast that express delivers all
Anthony Seymour-Walsh: you need to know in the fast
[Voiceover]: moving world of online retail.
Anthony Seymour-Walsh: Here's your host, Bushy.
Nathan Bush: Welcome to another episode of Add to Cart. I'm Bushie and I'm joining you from the land of the terrible people otherwise known as Brisbane, Australia on Add to Cart. We welcome everyone to share and listen to e commerce stories. The more diverse the better. I want to especially welcome the traditional owners and the original storytellers of the land that we are on, our indigenous
[Voiceover]: and Torres Strait Islander listeners to join us in our e commerce conversations and our community.
Nathan Bush: I will admit today's guest and company snuck up on me and it took an apparent cost of living crisis to realise how much of an ingrained part of the shopping experience it is for so many shoppers around Australia. So much so that I got my wife Sarah hooked on it and she's booked all of our upcoming travel through this platform and I reckon saved us about 43 bowls of ramen in the process. Anthony SEYMOUR WALSH is CEO of Cash Rewards, an Australian cashback website with over 2 million members and partners like Apple, Amazon, Maya and Liquorland. If you are not across cashback sites, they kind of act as a marketplace for bargain hunters where shoppers accent shopfronts via the cashback platform and claim a percentage of their purchase price back and that can be anywhere from 1% to 20% on every purchase. The scary thing is In Australia around 3% of E commerce transactions go through cashback platforms compared to 15% in the UK. So we are only at the start and it's great to have Anthony on at this point to share how Cash Rewards are offering the platform for Australian retailers. In this chat we hear about Cash Rewards Charitable beginnings. Anthony shares the metrics that retailers are using to measure success on the platform and he tells us the way in which Cash Rewards tailors benefits to customers lifestyles. It's not just about whacking a percentage off on every purchase. Before we get into this chat, keep an eye out this week because we have another bonus episode that's two in two weeks and it drops on Wednesday. This time it's our live podcast with John Wild, Chief Growth and Marketing Officer at Pet Circle. We recorded this chat at the Mumbrella Retail Summit and it was a cracking chat covering everything from how they personalize communications based on your dog all the way through to a zempic for pets. Hey. And was only half an hour and we covered all that territory. We really enjoyed that one. That drops this Wednesday. So thanks to our partners, Shopify plus and Deliver in person. Here's our conversation with Anthony Seymour Walsh, CEO of Cash Rewards.
[Voiceover]: Anthony, thanks for joining us on Add to Cart.
Anthony Seymour-Walsh: Thanks Nathan. Great to be here and thanks for having me.
[Voiceover]: It's brilliant to have you here because on Add to Cart what we do is we love highlighting great Australian e commerce stories and Cash Rewards is always soft stood out to me that have a great story but I never knew a lot about until more recently and I'm really excited to have that conversation with you today. Can you share with us for those who may not have come across Cash Rewards and I don't know how you'd miss it at some of your crazy booths at online retailer and the rest who Cash Rewards are and what you do, Great look.
Anthony Seymour-Walsh: Cash Rewards is Australia's favourite cashback platform. We were founded almost 10 years ago by two individuals who wanted to give back to consumers and also support support a great cause. So we are Australian founded, Australian owned and operated. And what we do is we work with merchants to give great cash back opportunities to clients for shopping online. So merchants pay us, we then take most of that commission the merchants pay us and then give that back as cash back to clients. And we also support the Starlight Children's foundation in giving 1% of all cash back redeemed by our members back to the Starlight Children's Foundation. And we just surpassed $2 million doing that recently. So it's a brilliant business that gives back to members, supports merchants achieving great outcomes and also has a great purpose behind it.
[Voiceover]: That's amazing. And that 2 million milestone for the Starlight foundation only came up this week as we're recording and it was brilliant to see what's the connection to Starlight there?
Anthony Seymour-Walsh: Yeah, look, the connection is that our founders, Andrew and Lorika Clark, they had a son who was unwell and that's had a really happy ending, which is fantastic. While their son was unwell, they were thinking how do we give back to a great cause that supported them while their son was in hospital and they founded Cash Rewards with that cause behind giving back to an organization that helped them. And so our passion and desire to support the SALT Children's Foundation. It's in our DNA. At Cash Rewards, we work to a greater cause and that supports, obviously the Starlight Children's foundation, but it supports giving cash back to members, and particularly at a time where the inflationary picture means that household budgets are stretched, but also supporting retailers and merchants with really great returns on the investment that they make in their marketing channel activity. So Cash Awards really has something in it for everybody.
[Voiceover]: I think you're hitting all our key themes right up front. We've got to launch off. So I think where it was really interesting to me was in my research, I saw that you've given customers back $165 million in cash back. Doing the maths there with you reaching that $2 million milestone with Starlight, I'm assuming that's even larger now, given that's 1% of total cash back. I won't agree on that because it's probably a bit confidential about where you're at, but $165 million publicly. Can you walk us through how it works from a customer experience, from those who may not have used it themselves?
Anthony Seymour-Walsh: Great look. From a member perspective, Cash Rewards is free to join. So a member joins Cash Rewards, either downloads our app or signs up@cashrewards.com au they then start their shopping journey within the Cash Rewards environment. And they might go and shop with a really big client like Maya, for example. So that member goes and shops with Maya, they might spend $100 with Maya, and we will have a cashback offer for them of potentially 10% cash back. So after that member's shopping journey is complete with Myer, as long as they don't return the products, MYA will confirm that sale, they'll pay us the commission, and then we will give that 10% back to the member. And everybody's had a great experience through the journey.
Nathan Bush: Gotcha.
[Voiceover]: So a customer goes and lands on the Cash Rewards site, first chooses the retailer that they want to shop with, clicks through, then lands on the retailer site. It's not a retailer site within the Cash Rewards platform.
Anthony Seymour-Walsh: That's right. We send our members into the retailer's environment.
[Voiceover]: Okay. And I understand there's also a Chrome plugin that can work.
Anthony Seymour-Walsh: There is. We have a browser extension and that goes with our members wherever they shop and reminds them of the opportunity to get a. A bit of extra value whenever they're shopping. But it's something that our members tell us is really valuable from a loyalty perspective. They know that as a Cash Rewards member that they're getting a great deal wherever they shop.
[Voiceover]: Yeah. Awesome. So it's almost like the little shopping helper up in the top right corner of your browser.
Anthony Seymour-Walsh: It is.
[Voiceover]: So from a retailer's perspective, tell us about some of the clients that you've got on. Because it is a bit of a who's who of E commerce in Australia.
Anthony Seymour-Walsh: It is. Look, we work with some of Australia's biggest brands and some really large global brands. So if we think about the likes of Amazon, I mentioned Maya, we've got Virgin, we've got booking dot com. So that's a really small select few of a really large group. We have over 2,000 clients in the database for members to interact with and so for us we see there's something for everybody in our merchant base.
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[Voiceover]: Yeah, great. And so from a retailer's perspective, what is the typical percentage back that you see?
Anthony Seymour-Walsh: Yeah, look, we see percentage given back to customers vary based on the goals that our merchant clients want to achieve. But we are regularly seeing north of 20% given back to customers and that will be varied on the basis of the objectives of the merchants. So we can be really flexible with our merchant clients and work with them on what are they trying to achieve. Is it winning new members? Is it driving trade with existing members? Is it driving that loyalty outcome? So what we then do is we partner with them to be flexible based on what objectives they're trying to achieve in their business. But to a member regularly, north of 20% is available.
[Voiceover]: Wow. I went on last night because my daughter's birthday's coming up and she wants a kid's garment watch. And I said to Sarah, my wife, I said, oh, I'll organize that because I knew I could organize it online. I didn't have to go into a shopping center and it's the biggest dad present ever, really, when you think about it, it's like, I can't get that one wrong. So I was about to go on to Amazon and she texted me straight away and she was like, before you buy, go check out cash rewards to see if there's a cash back first. And there was, but Amazon did it really well in that, I think above the line. When I land on the site, it said something like 3% off Amazon purchases. You go into the T's and C's and it was 3% off certain categories. And it was mostly their soft furnishings. And you could tell the high margin stuff. And then it had electronics, they were at 0% cashback because obviously not as much margin there. How flexible can retailers be in picking and choosing what their campaigns look like?
Anthony Seymour-Walsh: Yeah, it's a really great question. So the flexibility that our retailers have in relation to how deep they can go and the types of campaigns they want to run really depends on how we integrate with them. So the way that our retailers integrate with us is via affiliate networks. So some of the large affiliate networks, you know, will have different integration capabilities and therefore different mechanics made available. So Amazon, as an example, has an integration that enables us to vary the cash back based on the category that they're wanting to promote and drive.
[Voiceover]: Can you work directly with retailers without an affiliate network attached?
Anthony Seymour-Walsh: Today we don't. We do need that affiliate link to enable us to integrate directly and that's just a complexity thing on both sides. So in the spirit of eliminating complexity, affiliate network links a great way of effectively standardizing how we work with retailers. And it's the same for retailers. So we do prefer to use that channel. But as I mentioned, setting up our own direct network has enabled that to be a much closer direct relationship with clients.
[Voiceover]: And I can imagine that also helps with transparency on reporting because that's going to be so important because there's a financial play here. So what are the kind of metrics that retailers are measuring success of cash rewards with?
Anthony Seymour-Walsh: Great question. Look, it's all about performance to a retailer. We live in that performance marketing channel in our cashback business and how well we perform in giving them a return on their ad spend is the way that they measure everything that we do. And so the beauty of cash rewards is from a cashback perspective, you only pay when a member goes and completes a transaction and that there's no return. And that gets finalized in the way that the retailer wants. And we do a Reconciliation after and the cashback is paid to the member after the fact. And so the ability to report on that in an end to end sense is probably the best that exists across all of the marketers options out in ad land. So we really hang our hats on the ability to drive performance outcomes and then support our retail partners with absolute clarity on how their campaigns by cash rewards performed.
[Voiceover]: And are you able to share what kind of return on investment your retailers are getting?
Anthony Seymour-Walsh: Yeah, look, we ran an independent study leveraging Forest recently and they've measured that we deliver a 14% return on ad spend for retail clients on average. And so it can be much higher or lower depending on what type of mechanic is running. But 14% was the average and that was something that we were really proud of. And that comes from a couple of different sources, which is new members or new members becoming new customers to the retail client is really valuable to them. But what we found is that our members generally exhibit high loyalty, higher average basket size and higher frequency of purchase. So those are some of the other things that came out of the independent Forester study.
[Voiceover]: Amazing. So that begs the question, and I'm sure you're probably sick of hearing this question, how do retailers know that the customers that they're getting through cash rewards that they're giving margin back to effectively, how do they know that they're going to be new customers, not just cannibalizing customers that would have shopped anywhere, but like me have taken the Amazon route and gone, well, I'm going to go here first and get a little bit back. I would have shopped there anyway. How do you get around that?
Anthony Seymour-Walsh: Yeah, that's the ever present challenge I think for all marketers in almost all of the activity that they're trying to run. So we have a couple of capabilities. When you first come on board as a client, we do encourage that we start with a all inclusive offer and that helps us to test and learn and understand the performance. So in understanding that performance, what we then do is we work together with our retail clients based on what goals they're trying to achieve. So what we can then do is vary the cashback rate and the commission that a retailer pays to support that cashback rate for a new member or a new customer versus an existing customer. The one caveat that I would say is to participate in the cash rewards environment we do need to have something for everybody all the time. But that as I mentioned, is about ensuring that we generate that loyalty, we drive those higher average order values and that we drive those repeat purchases. But we have the ability to play around with new member rates and existing member rates.
[Voiceover]: Gotcha. So what are you typically seeing in retailers offering new customers versus existing customers?
Anthony Seymour-Walsh: Look, it really varies based on the industry. As you highlighted earlier, the Amazon example, different categories have different levels of margins available for marketers to make decisions. So I would go back to, we're regularly promoting 20% and above. But if you think about the airline industry, for example, a 20% cashback is probably not palatable, whereas in the fashion industry, that's something that's far more reasonable to be giving back to members to encourage those new clients and driving trade.
[Voiceover]: And is it kind of like the supermarkets where the more discount or the better offer that retailers can offer, then you can amplify that offer to your customer base?
Anthony Seymour-Walsh: Yeah, that's absolutely right. Will always seek to give the richest possible amount that we can afford back to our members. And we have a reality of running a business like everybody, so we need to manage that. But for us, our member engagement comes via the value that they're getting from the program. And so we are constantly trying to find ways of giving the maximum amount of value back to members. And look, what I would also say is that the beauty of cash rewards and the breadth of the coalition of great partners that we've got with over 2,000 merchant clients, the regularity of engagement with cash rewards and the breadth of the offers that exist means that members have a high propensity to come back to cash rewards because there's something in their everyday spend needs that we can cater to.
Nathan Bush: I forgot to ask you right at
[Voiceover]: the start, it's one of the most
Nathan Bush: basic questions I should have asked you
[Voiceover]: right at the start. What does your member base look like? How many members are we talking?
Anthony Seymour-Walsh: Yeah, so We've got over 2 million members in the program and that's really accelerated in the last couple of years as we've gone out to market with a new brand proposition. And the member base does skew slightly towards females and slightly towards sort of mid to upper affluent members. And generally the household construct is one where there are families with sort of anywhere between young and sort of older children. I'm right in that member cohort at the moment. So married with a couple of boys who are 14 and 12. And my household bills are quite extreme. I think we're at the peak of household spend. And so the reason that that customer group resonates most with in the cash Awards member base is the breadth of things that we can provide cash back on to families with that type of construct is enormous and potential value if you're a highly engaged customer. So last year, a highly engaged customer who transacted, say, north of 10 times in the year received an average of $270 cash back.
[Voiceover]: Okay, 270, that's a lot of money.
Anthony Seymour-Walsh: It's pretty handy at a time where inflation and the household wallet is stretched further than ever before. You know, for something as simple as engaging with cash rewards and using us to start your shopping journey, $270 cash back does make a really significant difference to the household budget.
[Voiceover]: And I could imagine in the last 12 months, as wallets have tightened and customers have gone seeking more bargains, bigger bargains, you would have seen huge growth as well.
Anthony Seymour-Walsh: We're seeing really big growth. It's been fantastic to be a part of that growth. It's obviously helped us as a business, it's helped our clients with their performance outcomes. But the two most rewarding things for us is seeing us support the member's household budget and also the Starlight Children's Foundation. And look, you know, elaborating on that a little bit, a couple of things that we've seen pop out as trends is that as the household budgets have tightened, people are starting to spend less in those bigger retailers. And so that has been a bit of a challenge for those bigger retailers. But what we're not seeing, our members slow down on, purchases like travel, tech and electrical remain strong, and even fashion remains strong. So those are the big categories for us. But travel post Covid just despite household wallets tightening, that is a category that has continued to fuel amazing growth and a category that obviously members receive a really high level of cash back for.
[Voiceover]: Can imagine you're sitting on a pile of customer and transactional data there. How do you use that for insights for both yourself as a business, but also to help your retailers?
Anthony Seymour-Walsh: Yeah, we would love to evolve our proposition to do more to help our retailers. So we do want to get to a place where we can provide a lot of those insights back to our retailers and where we're actively working on that as a product feature. For us, what it helps us to do is to improve the relevance of the offers that we put in front of our members. So we're really passionate about ensuring that the communications that Cash Rewards delivers to our members is relevant to them. It's timely, and there's something valuable in it for them. That hasn't always been the case, but what the breadth of that member engagement enables us to see is it gives us a picture of who our members are, what is valuable to them, and then tailor our communications and offers accordingly. So you'll see more of that from Cash Rewards over the coming weeks and months.
[Voiceover]: I'd love to go into some examples if you've got any, because I'm sure by now we've got retailers listening who are like, okay, this might be a channel that I haven't considered or I've seen it before, but I never really understood how it worked and hopefully we've clarified some of that. When you think about some of the best retail campaigns that you've worked on at Cash Rewards, can you highlight any that stand out?
Anthony Seymour-Walsh: Definitely. Look, one that we're working on at the moment, actually, and we did the same thing last year, is we worked really closely with Pizza Hut. So Pizza Hut wanting to. They're a real growth brand and a challenger brand in the market. And what we're working on Pizza Hut with is finding the right ingredients to engage our members with the Pizza Hut proposition at the right points in time. So we did a couple of things last year. Savvy Saturdays is one where you can probably imagine you've got kids sport. I know my boys play basketball. I'm constantly running around from basketball game to game and then you get to the end of Saturday and having an offer with Pizza Hut to get, say, 40, 50% cash back on a really simple dinner option is just a fantastic proposition for members. And we've innovated that around other events, like the rugby, for example, and partnered up with other retailers in coalition around a rugby event particularly engaging for the New South Wales audience. And we're also running competitions in conjunction with Pizza Hut to help them get a better understanding of who their members are and really cross pollinate between the cash rewards member experience and driving members to engage more regularly with the Pizza Hut environment. So that's a really good example where we've partnered and innovated with a retailer.
[Voiceover]: I love that example because it's fitting into a customer's lifestyle rather than just slapping a percentage across everything. It's got a real hook to it. How do you then get that message? So Pizza Hut have given you that to run with. How do you then make sure you get that in front of your 2 million active members at the right time?
Anthony Seymour-Walsh: Yeah, so we have a number of really effective channels. The three primary channels for us are email channel, our push notifications for our app members and as you mentioned, the notifier browser extension. And so what we do is at the right time, notify Customers via particularly the email and notify channel. And that sort of engages them to start their experience with cash rewards and then drive those performance outcomes. For Pizza Hut.
[Voiceover]: Yeah, great. Have you ever had brands partner up to have offers or deals via the platform?
Anthony Seymour-Walsh: We haven't had a brand partner up per se, but what we do is partner brands that we believe provide great relevance to one another. So I'll use a travel example. We will do what we call pack your bags as a travel campaign. And so we will partner up our airline partners, our hotel partners, and then say travel accessory partners, maybe it's tour operators, car hire partners. And we will put that into a consolidated email that's complimentary. A consolidated campaign, I should say that's complimentary and really drive that member excitement around cash rewards being the place to start your shopping journey, to get your all inclusive holiday experience.
[Voiceover]: Yeah, great. And so with the Pizza Hut one, after a day out with the boys running around sport events, probably Pizza Hut plus Liquorland, right?
Anthony Seymour-Walsh: That's right. That traditionally has been a great partner. Now we've unfortunately not got Liquorland on the platform at the moment. They made a decision to exit all affiliate programs. BWS is a great partner to cash awards and there is definitely opportunities for us to do exactly that. Get your New South Wales rugby or your Victoria, South Australia Aussie rules pizza and beverages fix ready for the big game of the weekend.
[Voiceover]: Yeah, that makes sense from a decision maker perspective because this does directly impact margin and it's a promotion led offer. Who in the business do you normally come up against to try and convince that Cash Back is a model that will help a business grow and acquire new customers?
Anthony Seymour-Walsh: It's probably no surprise that it's to finance stakeholders. And to me this is brilliant because I have a background as a chartered accountant and people often ask me, how, as a chartered accountant have you progressed to running what is effectively a digital marketing business? And I don't have a great answer for that. I'm sorry, but I loved every minute of it. But what we find is, yeah, it's the finance team who are the most challenging stakeholders to help support with a great understanding. But what we say to them is the performance channel in which cash Rewards plays is one that's probably your most measurable channel. You absolutely get outcomes that are measurable for the activity that it drives. And so what we ask them to consider is when you're thinking about your breadth of marketing investment, where else can you get that guarantee that when you make an investment, it's linked? Absolutely. With a customer outcome and that you can measure that outcome fully. So that's a really key conversation that we set our teams up to have with the finance teams.
[Voiceover]: Yeah. And this leads into a question we had from our community. So Elon Hurwitz asked the question before we came in is like, what tips do you have for retailers? And I'm assuming this goes into CFOs as well for protecting that margin. I mean, we've talked about some of the things about scaling the discounts, new customers versus returning customers, and by category, are there any other tips that you've got for retailers to protect that margin?
Anthony Seymour-Walsh: Look, in terms of protecting the margin, I guess what I would say is test and learn and see what works. And then when you come up with a formula that does work, then look at how you can expand and evolve the use of that mechanic. So I'll elaborate a little bit on that, which is at cashrewards. One of the things that we've done to expand our business and expand our impact is we've recently launched a retail media business called Circuit. Retail media is very popular at the moment. Everybody seems to be entering that space, but there are a few key ingredients that you need to enter that space. And so what I would say is that we're finding a really good overlap between our retail partners who are investing in the cashback business as well as making an investment in Circuit to drive that above the line brand awareness that's helping with performance outcomes and helping with that conversion. And it's fully measurable end to end. And so in terms of protecting that margin, I would come back to using the breadth of your ability to measure all of the marketing spend that happens across all of the different channels that you can invest in. And then look at how to optimize in the performance marketing channel with a partnership like Cash Rewards to really ensure that you're getting a great return on that investment. And it also comes back to what's the frequency and the loyalty of those of your customers who are using channels like Cash Rewards and what's the average order value? So we've been able to prove out that incremental average order value over time. Those are things that should go into that margin equation.
[Voiceover]: So think about customers that you might acquire or regularly engage with at Cash Rewards and measure them over the lifetime value rather than on the single transaction.
Anthony Seymour-Walsh: That's right. Lifetime value is so important. Single transaction measurement is interesting in the week, but it's also about creating balance over the journey and something that we do as well with our members and with our client activity, we have to measure the customer lifetime value rather than the impact of one or two transactions. So we really take that long term view and encourage our clients to do the same.
[Voiceover]: That makes sense. With Circuit, the retail media offering, how do you engage with retailers around that versus the traditional cash rewards model? Do you have to be offering cash rewards promotions to be able to participate in Circuit?
Anthony Seymour-Walsh: The answer is it depends. So we are looking at different models and this business is four months old and so we're really testing and learning as much as anything. And a lot of great learnings are starting to pop out. So we have started by offering that Circuit proposition to our existing cashback clients. And what we're encouraging is if you're a smaller retailer in particular, who may not be able to command a top position in some of the communications that go out, if you couple that investment in the cashback space with a Circuit placement, that helps you to elevate your position in our communications and, you know, really drive those performance outcomes that you're seeking. So we're really flexible at the moment with how we're working with our existing cashback clients in that space. And we're also looking to expand our offering to engage with suppliers of our retailer clients and also working with media agencies to help particularly the bigger clients with where are those brand dollars going and how might we support with actively engaged members who have a purchase intent in the category that you're looking to put some media investment and placement into? So we're really looking at engaging in those three ways. But as I said, it's an emerging business and we're really lucky to have a new general manager of retail media, a guy called Lachlan Bray, who has joined us previously mixing drinks and has an extended sort of media agency background. So really lucky to have him guiding the business going forward.
[Voiceover]: That's great. And is that the commercial model for cash rewards moving forward? Because I'm just trying to get my head around that if Maya is saying yes, we're giving 5% off to customers, that 5% goes to customers. Do you charge Maya more than that? 5%? How do you make living?
Anthony Seymour-Walsh: Yeah, it's a really good question. Look, there are two components. So within the cashback business, the way that it works is we work with Myer and they pay us a commission for every member that we send them who ends up transacting. So with that commission, let's say your example, Maya pays us 5%. We might give 4% of that to a member. Now that varies depending on what offer is available and what the merchant arrangement is. But we might give 4% of that as cash back to the member and then retain that small margin ourselves to cover our costs and run the business. So that's the cashback side on the circuit, retail media side, it's more of a media play. So you've got to think about this as coming from a different marketing bucket than the performance bucket. So what we're really doing is trying to help retailers manage their above the line ad spend and media placements more effectively by helping them with closed loop conversion attribution for that spend that they may not get through other channels like outdoor, like in store and even Google and Facebook.
[Voiceover]: Yeah, and I've been working with a couple of retailers recently who are seeing huge growth in affiliates and especially Cashback that they might weren't necessarily expecting. And I'm not saying that just because you're here, there's definitely a trend towards that. But now because it's is kind of taking on a life of its own, they're looking at budgets and go, well, where do we take other budgets from? Where do you normally see cash rewards play alongside in terms of decision making? What channels?
Anthony Seymour-Walsh: Yeah, look from a marketer's perspective, you've got a myriad of options. We see the performance marketing space really taking, attempting to take dollars away from say paid search and other third party channels that don't have the same level of closed loop one to one attribution. So that's where we're really competing. And what we find is in Australia, the cashback players that exist in Australia. It's a really nice scent market in Australia. So the cashback players in our market capture around 3% of online sales. When you look at more mature markets like the US and the UK, that penetration is closer to about 15%.
[Voiceover]: That must be exciting for you.
Anthony Seymour-Walsh: That's right. Really good Runway for us, really good Runway for retailers and really good Runway for members to generate more value. But what that says to me is there is a huge opportunity for marketers at retailers in Australia to leverage the performance marketing channel to really grow the impact and the effectiveness of their marketing spend.
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Nathan Bush: Check out shopify.com auplus and get in touch with the Aussie Shopify plus team to see how Shopify plus can help you unify your tech stack for growth.
[Voiceover]: So then the question for you is that if the market is currently at 3%, we've seen the USA at 15%. There's obviously lots of growth in the cashback space and affiliate space in Australia. You are one of a few players here. How do you maintain something that is totally unique, that both customers gravitate towards you and retailers gravitate towards you rather than blending in with all the other cash back?
Anthony Seymour-Walsh: Yeah, that is a great question and one that we're constantly asking ourselves. And I would say I'm looking at this from a multi phased approach. So right now, at the level of penetration that I just described, I think we've got an opportunity to collectively grow the industry and that is about creating understanding amongst members that the cashback opportunity that exists for them, it's not a scam, it's absolutely real and it's really valuable. As I mentioned, for those engaged customers who are getting north of $270 cashback a year with us, that's a really valuable thing to be doing for not a great deal of extra effort. So that's one element. The other thing that I'd say is with our retail clients and other clients is using the performance marketing channel to drive the outcomes that you're trying to achieve in your business is going to help grow that industry. And then for those retailers and clients, as the industry grows, we are really hoping to partner with them to make it a really efficient and effective way of using their marketing investment to generate measurable outcomes. So I see that really as being the table stakes that need to exist for phase one. I believe that there's an opportunity to expand the products and capabilities that we might offer as a brilliant cashback operator. But I also see that the more things that you try to articulate to a member as they're first entering this space, the more complexity that exists and you run the risk of it all being too hard. I'm really focused on simplifying what this represents to a member, why it's important to them and then helping those new members become really engaged with our clients and retailers.
[Voiceover]: And is the focus for you dominating the Australian landscape or is it that you want cash rewards to be the global go to for cashback?
Anthony Seymour-Walsh: Yeah, look, we are really focused on the Australian landscape at the moment. We're focused on the Australian online landscape and so there's a few elements that I'm looking at from a growth perspective. We are actually owned by the Anz Bank's venture capital arm 1835i. So we've got a really great relationship with the bank and we're looking at how we might support their customers from a financial wellbeing perspective with some great offers in the online cashback space. That's one angle that we're looking at. We also had an in store capability that was supported by card linked offers. So what we were asking our members to do is to link their credit or debit card and then when they link their card and they shop in our partner retailers and clients, they would get cash back on those in store purchases. Now for a few reasons that that wasn't working as effectively as we might have liked. But we have ambitions to get back into the in store space and we're looking at ways of doing that in the fairly short term. So we need to get those two things right and really working in an effective way. And then from there what we will do is we will look at where might we expand beyond Australia over the say three to five year horizon. And without giving too much away, you know, the Anz bank does have a global presence and so perhaps some of our partners across the ditch, uncharted territory for the cashback industry over there. That might be not the biggest geography but a logical next step for us to take in partnership with Anz and their presence over there.
[Voiceover]: That makes sense. You mentioned the in store, you went in store, pulled it back out. What was the biggest challenge around integrating cashback in store?
Anthony Seymour-Walsh: Yeah, look, there are a couple of key challenges. So we worked really closely with the credit card schemes. So Visa and MasterCard, great partners, really, really supportive of the approach. The challenge we found is to sign up our retailer and client partners in store meant that there was quite a bit of manual effort to sign them up effectively and ensure that everything was working. The biggest challenge that we found was it wasn't delivering engagement in the ways that our retailer clients wanted. So what I mean by that is when you've linked your card, it's a bit of a set and forget and you can passively earn and that's a cost to the client. It's eroding their margins, as we spoke about earlier. And we couldn't necessarily prove the incrementality because of the lack of digital engagement and that conscious purchase intent, yes, it
[Voiceover]: comes down to intent really, is that you want to make sure that the customer. You've changed a behavior or influenced a behavior rather than just being there.
Anthony Seymour-Walsh: You know, the seamlessness of it was a fantastic proposition for those customers who understood the benefit that they were getting. But for those that didn't, we could see that that was going to be problematic in terms of justifying that ongoing investment with our retail partners. So we've made the call to turn that off. What we are looking at doing is ensuring that there's a level of friction without compromising the purchase experience that helps all parties understand the value that's being created. So we want our members to be rewarded for engaging with us, with our partners with healthy cashback in store. We want in store for there to be some level of engagement where there's a conscious intent that Cash Rewards has influenced your purchase decision to go to that store. And then that needs to create a measurable outcome that we can go back to clients and say, here's the performance of the investment that you're making with our members.
[Voiceover]: I could imagine that you've got some cash reward members who know how to play the game very, very well. Kind of like loyalty point members or Qantas Club members. There's people who just live for it. Are there any member stories that stand out for you around members who are racked up crazy amounts of cash back?
Anthony Seymour-Walsh: Look, I'm going to say I'm one of them. I've just ticked over $4,000 of lifetime value. I've actually only been at Cash Rewards for just over 12 months, but I've been a member for over four years. And I'm in a privileged position of getting a lot of cash back because I'm one of those loyalty point gamers that just loves and does everything that those programs sort of ask me to do. Now, the thing that I would bring it back to is those that pay attention to these offers, we want them to be gaming the system in a way that gets them hundreds of dollars of value each year. And so what we've got is a really great way of engineering that value for the member, value for our retailer partners and that that's a sustainable approach for us to continue to give that great cash back to our members.
[Voiceover]: $4,000 is a nice little bonus.
Anthony Seymour-Walsh: It's brilliant. And I spoke about travel earlier being one that's quite popular, but that's probably the place that I've got the most value from. Imagine when you go and book an airfare in a hotel to take your family somewhere, that's a really valuable opportunity. But beyond that, you know, your everyday spend. One of the things that I find is kids are going back to school. That's a particularly expensive time of year. So things like the technology category, with two kids, one son in high school and one approaching, you know, to buy them a laptop, that's a really expensive exercise. Even shoes for back to school and sports. We've got a multitude of retail partners who cater to that space. And then there's gifting at Christmas time, there's Black Friday and throughout the year. So if you're not using cash rewards, you're almost penalizing your household budget and missing out on value. And same for our retail partners is if you're not putting your brands in front of our huge member base, particularly at those key times, you're possibly missing out on customer attention and conversion.
[Voiceover]: It reminds me of how afterpay started. Obviously you're not starting, you've been around for 10 years. But for afterpay, it was all about meeting the customer demand in that customer wanted to buy a pair of shoes. So they went to the afterpay site to see what retailers could sell that they could pay in four on their shoes. And then they went to the retailers based on who was offering afterpay. It feels like a very similar mindset from a customer perspective.
Anthony Seymour-Walsh: It is. And if we talk about those customers, you know, going back to those customer stories where perhaps people have gamed the system, that's exactly what we receive in terms of feedback from those high value customers. They have an aha moment when they get to about their third shop and when they get to about their third shop and they've racked up some reasonable value by engaging with multiple partners, they see that they can withdraw their cash, they get cash back, withdrawn into their bank account and from that moment on they are absolutely hooked and loyal to cash wards and the retail partners that exist in our environment and they just search for the best deal starting with us, but for the best deal with the retailers that exist in our ecosystem.
[Voiceover]: And I hear your point around, those customers who are trying to game the system are actually really good customers because they're committed and they can be actively persuaded to change built in behaviors or preferences of where to shop. Do you have any tips for retailers who might also offer a loyalty club or other first time bonus offers on their site where discounts could potentially be stacked and margin eroded? I know we talked about margin erosion before, but thinking about from a customer's perspective, they come onto cash Rewards, get their 5%, then they might get their first time purchase, they bonus with the retailer, then they might get a loyalty offer and by that point you've given away a fair bit from a stacking of discounts perspective. Is there any tips that you've got there?
Anthony Seymour-Walsh: Look, I think the biggest tip is first of all to be aware of it because it's not something to be afraid of, it's something to think about in terms of what outcome are you trying to drive with the member. So there are naturally a pretty large portion of members who will always look for the best deal. But the other thing that I would encourage retailers to consider is not to overdo it in those first couple of transactions. Because if I as a customer have my first experience receiving four or five amazingly lucrative one time only offers, you've adjusted my expectations going forward to something that's unrealistic and unsustainable and actually then purchases two, three and beyond, if I even get there are almost like a disappointment. So I would say test and learn in this space without overdoing it early. But I always bring it back to, you know, in my time in loyalty programs and then retail more generally. I think too often and at times cash swords can be guilty of this is too often we think about what are the things that we're trying to achieve as a business first, when actually what we should be thinking is what are the things that are going to be valuable to a member, to a customer and how do we design around that. So that's ease of use, it's value, it's convenience, it's all of those great things that retailers have to consider and I would take the multitude of those things into account when you're designing your first foray into winging a new customer. I don't want to discourage the use of cash back. Obviously we want to ensure that cashback is as high as possible. But I also want to manage expectations which is if you give this amazingly rich one time cash back to first time customers, future expectations may be unrealistic and therefore disappointment. So you want to have consistency. And the final thing that I'd say is don't be afraid to stack. That's where we see some of the best deals come from and that's where we see our members refer their friends and our members talk about the value that can be created. I got this great deal with this retailer and it was on promotion and I got cash back with cash rewards and that's the moment where they just say this is the best thing.
[Voiceover]: That's awesome. I love that summary there because I think it applies obviously to what you're doing at cash rewards, but just generally marketing is like offer the value first, think about the customer first. It all sounds pretty 101, but it's so easy to get off track when you are chasing sales. Think about where the customer is and where they are in that moment. And I think your Pizza Hut example earlier on was a great example of thinking customer first and their situation. We've got to wrap up. I've had a lot of fun just learning about cash rewards. Obviously I've been using it over the last year and it's been great to dive under the covers a little bit more and work out how it all works. What's exciting, you gave us a few hints around where you might be going with cash rewards in the team. What's on your radar for the next 12 months?
Anthony Seymour-Walsh: Yeah, for me, the radar for the next 12 months is we've got to evolve our personalization capabilities. So I'll be honest and say that too often the communications that we send to members aren't as personalized and targeted as we would like. So personalization for us is absolutely 101. We know that the cost of living is front and center in the psyche of every customer in the country. Doesn't matter which suburb you're living in, what state you're living in, what your level of income is, cost of living is an issue. And so we're looking at how do we expand the clients in our network to ensure that wherever our member base are shopping that there's something in it for them to get that extra value to help the household budget go even further. And look, the other thing for us is continuing to grow the industry. We want to grow brand awareness of cash rewards, we want to grow awareness of the cash back industry and we want to grow outcomes with our client partners, particularly in the retail space. And for us, the growth is also going to come from Circuit and the opportunity for retail media to play a key role in driving retailer outcomes and driving growth of member awareness.
[Voiceover]: Yeah, that all sounds fantastic. If I could put a feature request in you can take it or leave it. I would love to see something in there that supports Australian independent retailers. Obviously you've got Some Enterprise Tier 1 National and International clients. I know right now just as the cost of living is hitting consumers, it's also hitting our independent retailers and I'm not sure if there's something you can do there as an Australian founded retail partner, but I think anything that we can do to support our independent Australian retailers and brands, it would just be fantastic.
Anthony Seymour-Walsh: It was a great suggestion Nathan. And as I mentioned at the start, you know we are Australian founded, Australian owned and operated and so that notion of supporting great Aussie businesses, giving value back to Australian members, it's something that we're really thinking about how we dial up in 2024 and beyond.
[Voiceover]: Awesome. Anthony, you got a lot on your plate and it's great to see the success so far and can't wait to see where it all heads over the coming years.
Anthony Seymour-Walsh: Thanks very much Nathan. I really enjoyed the opportunity to catch up and talk all things E commerce.
[Voiceover]: Brilliant. Thanks Anthony.
Anthony Seymour-Walsh: Thanks Nathan.
Nathan Bush: Whether you are using cash rewards at the moment or a cashback platform or it's totally new to you, I hope you picked up a couple of tips and potential opportunities for your brand with that chat. Here are the three things that I took away from that chat with Anthony. Number one, with this platform, customer data is crucial. With 2 million members, cashback platforms like Cash Rewards can reach a whole new audience of customers who are ready to shop. But cannibalization is real. You want to minimize discounting to customers that would have shopped with you anyway. If you are pulling the trigger on cashback platforms, make sure you are measuring redemption for new customers. They're the good ones versus existing customers from this channel especially. Number two, don't just whack a percentage up. Think creatively about your customer's lifestyle and build around that. Think about what do you offer new customers versus existing customers? What about different regions, times of days? What other partners might you like to be seen with? What channels do we want to reach customers through? We've got app desktop, push notifications. This isn't a slap a percentage up and be done. You really need to think about that Pizza Hut example in how you integrate it into the customer's lifestyle for maximum impact. And number three, this is not a fad. As Anthony said, about 3% of of E commerce transactions in Australia go through a cashback platform. It's about 15% in the UK. It doesn't mean you have to be on a cashback platform, but it's not going away anytime soon. Be aware of it and know that it's a lever that you or your competitors can pull at any time. Thanks for joining us today on Add
[Voiceover]: to Cart to listen to all our e commerce conversations now in the hundreds.
Nathan Bush: You can head on over to addtocart.com there you can also join up to our free private Slack community to share e commerce ideas, tips and questions with other listeners. You can also subscribe to the Add to Cart weekly newsletter and browse some of the video highlights from our chats. There is a lot there that's add to cart.com au and if I can ask you one thing before you go. If you enjoyed today's episode, make sure you share it with a friend or a colleague who could benefit or leave us a review.
[Voiceover]: It really makes a difference.
Nathan Bush: Thanks again for listening. And until next time, keep those customers adding to cartoon.
