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REWARDS AND INCENTIVES WHAT’S NEXT?

REWARDS AND INCENTIVES WHAT’S NEXT?. OCTOBER 6, 2011. The “Rewards” of Keeping Debit Loyalty Programs Post-Durbin. Macro forces are changing the financial services landscape on many levels. MACRO FORCES. INNOVATION MEGATRENDS.

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REWARDS AND INCENTIVES WHAT’S NEXT?

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  1. REWARDS AND INCENTIVES WHAT’S NEXT? OCTOBER 6, 2011 The “Rewards” of Keeping Debit Loyalty ProgramsPost-Durbin

  2. Macro forces are changing the financial services landscape on many levels MACRO FORCES INNOVATION MEGATRENDS • Generation “Ready Access” – customers prefer paying with “ready funds” (debit, prepaid, cash) • Mobile Revolution – mobile technology is changing consumer behavior and payment business models • Blurring of Online and Offline – most consumers want multi-channel experiences • DDA Disintermediation – bank accounts are less critical to many payments innovations • New Customer Information and Incentive Paradigms – data is enhancing rewards, deals and customer experience • Open Platforms – customers expect interoperability and plug & play solutions REGULATION DEMOGRAPHICS ECONOMY

  3. A range of new players are getting involved Emerging Players

  4. Attracting new customers Retaining existing customers Incenting profitable behavior Use of low cost channels (ATM, online, mobile) Electronic statements Direct deposit Card spend Savings Relationship deepening/product cross-sell Incenting and rewarding consumerbehavior is more important than ever

  5. A range of interesting modelschallenge traditional thinking

  6. How has loyalty been impacted? • As Illustrated, there a great number of significant environmental factors—legislative, economic, behavioral, and technology-driven—that are impacting what a loyalty program needs to look like in the future. • The underlying purpose of loyalty programs remains, and, in fact, is stronger than ever—driving profitable customer behavior!!!! • Consumers expectations are high – What’s in it for me? • Consumers want value and flexibility, choice and options. • Consumers are also looking for control – instant rewards with long-term incentives – delivered up digitally.

  7. In light of all these market forces and heightened consumer expectations, what will successful “loyalty” programs look like in the near and longer term? Ultimately the goal must be providing value in meaningful, targeted, relevant and profitable ways: Must address, in a targeted manner, the broader customer relationship and the behaviors desired. (Earn side of the equation) Must provide meaningful incentives to drive the desired behavior. (Burn side) Must utilize all available channels to engage the customer-relevant in both method and time. Must be YOUR program—built for you and targeted to your goals, now and in the future. Must contribute to profitability. Loyalty more relevant than ever…to the consumer

  8. Thank you! For a free copy of today’s presentation email us at: info@rewardsnow.com Questions • Discussion • Feedback Steve VanFleet President and CEO of RewardsNOW svanfleet@rewardsnow.com Margaret Weichert Managing Director at Market Platform Dynamics Margaret.Weichert@marketplatforms.com Tim Kolk Principal and Consultant at TRK Advisors tkolk@trkadvisors.com

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