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The Agile Brand with Greg Kihlström®: Expert Mode Marketing Technology, AI, & CX
Shopback's Carolina Paradas on how retailers are shifting their channel strategies with cashback
00:23:42
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- [00:00]
A
What if the most valuable customer acquisition channel you're ignoring is the one you've always written off as just a discount tool? Agility requires not just adapting to new customer behaviors, but fundamentally re evaluating long held beliefs about which channels drive growth and which ones are merely a race to the bottom. Zara just made its first move into the US Cashback ecosystem ever this holiday season. For a brand that controls 13% of the US fast fashion market and has historically maintained tight control over its distribution and promotional strategy, this marks a significant shift. Today we're going to talk about the shifting economics of customer acquisition and how they're causing many brands to rethink their channel strategy. Welcome to season eight of the Agile Brand Podcast. This season we're going all in on Expert Mode, MarTech, AI and Customer Experience, talking with the people and platforms behind the brands you know and love. Again, I'm your host Greg Kilstrom and I help Fortune 1000 companies make sense of martech, AI and marketing ops. Hit subscribe or follow to make sure you always get the latest episodes and leave us a rating so others can find us as well. And make sure you check out our sponsor, Techsystems, an industry leader in full stack technology services, talent services and real world adoption. For more information, go to techsystems.com now let's dive in to help me discuss this topic. I'd like to welcome Carolina Paradis, GM North America Shopback. Carolina, welcome to the show.
- [01:31]
B
Thank you so much for having me. Really excited to be here today.
- [01:34]
A
Yeah, yeah. Looking forward to talking about this. Before we dive in though, why don't you give a little background on yourself and your role at Shopback?
- [01:41]
B
Yeah. I'm Carolina Paradas. I'm the GM of North America here at Shopback. I've been with the business for about six months, but I come from a rewards and fintech experience. Previous to this, I was working across many rewards platform including Kasha, bank of America, PNC and employee rewards platforms. I've also been on the brand side, so I feel like I've kind of got a lot of the different angles of the industry when it comes to rewards and overall growth channels.
- [02:14]
A
Yeah, love it. Let's start with talking a little bit about Shopback. Maybe tell our audience what the company does, what makes it different in a relatively crowded rewards space and who your core customers are.
- [02:29]
B
Sure. So we are a rewards platform that allows you to earn cash back on any online purchase that you make. So we are predominantly mobile. So we have a mobile app, we have the web version and also an Extension. So essentially you can use ShopBack as you would do your everyday shopping. You go to the app web or extension shop and browse on the brands that we have and then you would go on to shop as you would normally. In terms of our user, I think quite interestingly the way that we've positioned ourselves in the market because we very much mobile first, I would say, you know, our majority of users are Gen Z and young millennials. So anybody that is financially savvy, mobile savvy, anyone that's looking for that kind of extra rewards when they're shopping, whether it's, you know, whether it's everyday spend to travel or even playing games, you can actually earn cash back on shop back whilst you play games as well. So overall we try to be kind of in footstep with our users on, you know, every kind of category in their lives.
- [03:38]
A
Yeah, yeah, I love it. So I want to start with talking about this from the strategic shift here and what I teed up in the intro as far as how brands are rethinking and need to rethink customer acquisition. And so, you know, the holiday season, you know, 2025 at least is a few months behind us. But what we saw was brands who, you know, previously were very, you know, tightly controlling their image, their promotions and things like that, making a shift to change some of their long held channel strategies and how they, how they really behave in terms of, of their, their consumer audiences. Can you talk a little bit? You know what, what's driving this? You know, what's, is it economic, consumer behavioral shifts? You know, what, what, what are you seeing?
- [04:32]
B
Yeah, so I think what's really interesting is how we are right now in the market position. So when it comes to the macroeconomic environment that we all live in day to day, you know, no retail brand or, you know, across any category can afford to ignore the fact that users need to stretch their dollars. Like the average American consumer needs to be able to get something back. Or that's why we see an increase not only on cashback, but on any reward currency that you look at because ultimately the economic pressures that we all live in today, it's impossible to ignore by any retail brand. So I think where we are from a macroeconomic space, that's number one. But then when, when you think about overall brand strategy and what they're tasked to do as performance marketeers, it's, it's so far now from, you know, clicks and it's so far now from views and impressions only when we look at what CMOs what CFOs are looking for is actually having a return on investment on what you're doing and versus, you know, previously you think about 2021, both of, you know, even an investment front or performance marketing, it was all about more vanity or like upper funnel KPIs versus now we're all asked, right, to be able to prove the value of everything that we're doing. Long of the days of free money being kind of thrown at people. So I think it also comes from what the leadership a lot of these brands are facing in terms of their return on investment. And then lastly, I would just say, you know, brands have always been involved. If you look at, you know, other rewards, platforms have been around since literally the 1900s. They've had partnerships with department stores, luxury, whether it's luxury, beauty, luxury, fashion, et cetera. They have always utilized these tools for, you know, Q4 or like specific strategic moments. However, because of the economic pressure that we feel as consumers as and how much these brands are feeling it, they can't afford to just do it during Q4 or do it discreetly. So I think that what they've done instead is look at platforms like us or like anybody that can prove their return on investment and actually look at them as strategic partners. You know, how, how is your audience valuable to me and how I can work with you to, to meet each other's goals versus before, you know, the conversation was more weighted on the brand side.
- [07:19]
A
Yeah, so. Yeah, yeah. And so, you know, to, to that end, given, you know, the, everyone from the CFO to the CMO is looking for that, that return on investment, as you said. What does it look like then to integrate rewards not just at the top of the funnel, as you were saying, but really throughout the broader marketing mix.
- [07:43]
B
Yeah. So like I was saying, obviously if we look at, if you're looking at specifically a lower funnel activity, you know, specific affiliates or rewards partners that can provide you that kind of volume when it comes to sales and eyeballs, right. When it comes to new customer acquisition or rewarding your own existing user. These platforms are great. But the good thing as well is that at least what we're seeing on our side, we're obviously as well spending in things that are upper funnel. So what we, what we bring to our brands is the ability to do both, right? To create this flywheel of where you creating intention, you creating brand affinity and you creating that moment for the consumer when they're on social media, when they're actually browsing and they're in that Awareness phase and then shopback comes in or any, you know, acquisition partner you have. And then we are there when there is intent and when they're ready to purchase too. So we are able to provide brands that kind of like flywheel of branding innovation, ways to present yourself to the consumer, but also bring in ourselves when there is intent so you can prove your, you know, the roi.
- [08:54]
A
Yeah, yeah, well. And then so to get to the more tactical part of this as well. So you know, as I'm sure we well know, there is a massive shift to mobile commerce and just a demand for stackable value, particularly with the Gen Z audience. But really I think across the board, how do brands adjust for or what do they need to adjust to take most advantage of this?
- [09:25]
B
Yeah, mobile experience is extremely important these days. Not only, you know, with an app, there is a lot of brands that don't have their own app, however, you know, mobile browser and the overall experience that you can do from a smaller screen is extremely important. And to be transparent, not only in the retail space, but we do see brands still struggling to increase that footprint when it comes to Gen Z and Millennial because they don't have an enhanced mobile experience. Even for us, you know, the way the shop bag was created because we, we came from Singapore and Asia which is, you know, know almost 100% mobile. The way that we created our business was in mobile. Rails and Desktop came after. So the way when you entering the market with those strengths, that's what it makes a difference for us to have such a strong Gen Z and Millennial following. Right. So I think brands are feeling that more and more and focus in, on, on mobile commerce as a whole.
- [10:24]
A
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- [11:53]
B
Yeah, so I think that's something that we take a lot of pride on in terms of the experience the user will have with Shopag. So, you know, our experience is constantly looked at, qa, et cetera, but we will also work with the brand to make sure they're comfortable. So things like are very important to brands like logos, creative, how the brand is presented, what brands are next to, what category they fall into. We can work with the brand to really tailor the experience and make sure they're not creating the wrong habits for the users. So we're very, very particular on that front. And I would say the other interesting thing that we're doing is what I was mentioning earlier is actually we bring in upper funnel opportunity for brands. So we have a whole influencer network. We have a lot of editorial partners, we have corporate partners that can help us, we have sports partners that can help us expand a message. So we actually give brands the opportunity to expand beyond the last click. Right. So that's part of that flywheel. So we work with them on how we can be targeting the user at every stage of the funnel.
- [13:03]
A
Yeah. So when I get back to the ROI part of the conversation as well. And so, you know, as with anything, I assume traditional metrics are not going away and those are still being tracked. But are there additional or different, or maybe a different emphasis on some other key success metrics that should be tracked when, when you know, determining ROI on something like this?
- [13:32]
B
Yeah. So I think traditionally, right, when you look to specific partners that were focusing on acquisition, you would just mainly be looking for a new customer. Right. You would look for these platforms to bring in new audiences, new eyeballs, etc. Versus we've seen a shift on specifically brands that don't have loyalty programs themselves on a focus on existing customers. So, you know, if you think about the customer, the cost of new customer acquisition is huge. So how, you know, previously in the past, why when brands focus in that existing user and that's where We've seen kind of the shift and that's a newer KPI. Right. When you look at lifetime value and what is the overall existing customer quality that you bring it in? So there's definitely more emphasis on, okay, we can work on existing user campaign campaigns as long as we're seeing the right quality, the right audience, et cetera, versus before, you know, specifically platforms like ours would have been more looked at as the new customer acquisition tool.
- [14:34]
A
Yeah, yeah. And then from a customer behavior and you know, just kind of customer perspective, how does a cashback acquired customer compare to one maybe acquired through other types of channels? You know, are there any behavioral differences, any differences in loyalty, anything like that that you've seen?
- [14:57]
B
Yeah, I think traditionally the thinking was like, oh, these are more savvy consumers. These are users that need to or want to have something back for their spend. But honestly, now that we've seen the shift and the impact of all of the economic issues that we're facing as the world and like the whole world really, we're seeing that everyone, it's attempting to use rewards. You know, it's, it's the, it's the cashback. Cool. But there is also, you know, credit card points and miles. Everybody that we see whether is in our audience, whether it's Gen Z to Millennial, to what we call the CFOs of the household, households. So higher income, et cetera, everyone is trying to stretch, you know, get some value. What we've seen in today's world is that users want to understand why to shop with your brand, they want to see the value instantly. They don't want to shop and then see how you engage me. And if you have a brand loyalty program. No, they want to see that value instantly, which is driven rewards to be something more mass market versus like an assumption of a lower income demographic.
- [16:16]
A
Yeah, yeah, I know again, we're a little bit past the holiday season last year, but what I know from other brands is that they're already planning, already planning next one. So what would you say, what was the takeaway from last season that might be able to be applied to either not even waiting for the end of the year, but to be applied to the year ahead.
- [16:44]
B
Yeah, so we saw some really interesting stats when it came on the timing of the holiday season. So every year companies try go a little earlier and earlier, but actually last year we saw spikes from early October, so say from Prime Day, which is around the first week of October, kind of that peak and that ride didn't come off from there. So I think it's interesting that, you know, people are trying to start to go earlier to actually during the big moments like Black Friday and Cyber Monday, when it's super hard to highlight yourself, you know, they're trying to get the value of people who are seeking discounts and seeking rewards earlier in the year. For sure.
- [17:31]
A
Yeah. And then look, looking forward a little bit, how do you see this space evolving? You know, certainly there's a lot of different things at play here. There's certainly, you know, continuing economic pressures, but there's also, you know, AI innovations, a lot of focus on consumer data privacy. You know, how does all this come to play? And, you know, perhaps redefine the role that platforms like Shopback may play for major brands.
- [17:59]
B
Yeah, I think what's interesting is that even though we're evolving and we will definitely find new ways to reach customers, new ways to drive awareness, new ways basically of communication between consumers, ultimately nothing is going to be the same in the next 10 years. However, what I'm very clear on, and I think all of us at Schuldback are very clear on, is that the customer wants value more than ever. So ultimately, how you find it, how you interact, how you earn might change. That whole way of interaction with the consumer will change. However, what won't change is the seeking of value from users. If anything, it's increasing. So I think relevance for businesses like us, relevance for businesses that are, I would say, the middle of rewarding the user and being very clear what you bring to the table, have an opportunity to be able to continue to be successful. Like I said, ultimately, speed and being agile will change and will impact how you interact with your consumers. But ultimately, seeking value and the need for platforms like us is not going anywhere.
- [19:19]
A
Yeah. Yeah, definitely. Well, Carolina, thanks so much for joining today. Just a couple questions as we wrap up here. First one, if we were having this interview one year from today, what is one thing that we would definitely be talking about?
- [19:33]
B
Oh, I love this question. Let me think. Okay, so we're working really hard to bring key sports into rewards and how, you know, if you think about sports fans and rewards fans or rewards users, very similar. There's a lot of similarities there. So we're trying to bring those two worlds together and we're working really hard. So I feel like maybe we're going to be talking about how two industries come together and see success.
- [20:08]
A
Yeah, Love it. Well, we'll have to have you back on and talk about that. Love that. And then, last question for you. What do you do to stay agile in your role and how do you find a way to do it consistently?
- [20:21]
B
Yeah, so honestly, the way that we look at AI and tools in the business, we try and give everybody as many tools as they need to be successful and to be as efficient. Every day I keep myself educated, I keep myself curious and informed. So I listen to this podcast every day that basically gives you different tips on how you can make your time more efficient. So I continuously learn and I continuously apply this both in my professional and personal life. So I think continue to be curious and that's how I stay. I wouldn't say ahead, but I stay at least on trend on how to keep my time as efficient as possible.
- [21:03]
A
Yeah, love it. Well again, I'd like to thank Carolina Paradis GM North America at Shop Vacation for joining the show. You can learn more about Carolina and shopback by following the links in the show notes. This episode is brought to you by Tech Systems. They're leaders in full stack tech services, talent solutions and helping companies put it all in action. You can learn more@techsystems.com that's T E K systems.com and thanks again for listening to the Agile Brand podcast. If you like. If you liked the episode, hit subscribe and drop a rating so others can find the show too. And if you're interested in consulting, advisory work, or if you need a speaker for your next event, feel free to reach out. Just visit GregKilstrom.com that's G R E G K-I H L S T R O M.com the Agile brand is produced by Missing Link, a Latina owned, strategy driven, creatively fueled fueled production co op. From ideation to creation, they craft human connections through intelligent, engaging and informative content. Until next time, stay curious and stay agile.
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B
The Agile Brand.