Payments & pivot — our journey to date.

I wrote this late year (2015), a link to the original posting can be found at the bottom.

Almost two years ago we started Aston Club; a consumer digital wallet and mobile payment network. After raising $2 million in capital and receiving positive media coverage the team was on top of the world — we were introducing the Australian market to mobile payments and we were going to do something amazing.

However, after nine months our runway was shortening, customer retention wasn’t as strong as we had forecast, and merchant adoption had slowed.

Like any startup story, with the benefit of hindsight, you can see your mistakes; business mistakes (i.e. forecasting hubris), product mistakes (pre-authorised transactions), and hiring mistakes (too many new, junior team members). Yet these were not the underlying issues. We simply encountered the same hurdles faced globally by everyone in the digital wallet/mobile payment space; what is the customer’s incentive to adopt mobile payments and how to ensure consistent merchant participation? Towards the end of 2014 we made some tough decisions for the consumer brand. All marketing and promotional activities were suspended, we scaled back to the core team and went back to the drawing board. We knew mobile payment adoption was inevitable and we knew how to create value for our clients through technology, but in what form?

In the beginning, before Aston Club, we were building, selling, delivering and supporting our first Software as a Service (SaaS) product, Boogiespot. It was simple — a white-label iOS and Android product that rewarded customers for visiting and promoting a local business across their social networks. The product generated upfront and recurring revenue for our business, the client collected rich customer data through a simplified membership product, and customers received a reward for a simple action, such as a checking-in for a drink or take a photo for 10 per cent off the bill.

Whilst the functions of Boogiespot weren’t groundbreaking in themselves, the white-label approach, that is building the app wrapped in the business’ own brand, delivered unbelievable merchant participation. As of today Boogiespot apps have been downloaded more than 400,000 times. Each time a business marketed and drove downloads of their membership app, they simultaneously created more value for themselves and made our product stickier within their business.

And so, with the success of Boogiespot and the lessons learnt from the first 12 months of Aston Club, at the beginning of 2015 we introduced a revised model and product. This new product bundled customer loyalty and mobile payments into a single, merchant branded mobile app. This is our evolution.

For the merchant, we offer the simplicity and efficiency of mobile payments combined with the ability to drive new revenue opportunities and monetise their loyalty members. Importantly, as a white-label product the merchant maintains control of their brand.

For their customers, the mobile wallet is a secure and convenient way to pay at their favourite local businesses. However, it is the loyalty component that is truly valuable to the customer. For every $1 they spend, customers are rewarded with loyalty points which can be used immediately with the app for discounts, vouchers and exclusive products.

The combination of these value propositions, an incentive for the merchant to drive the product and rewards for the customer to adopt the product, is now underpinning our growth. More than 100 individual clients now have their own payment and loyalty mobile app and we are currently delivering contracts that will see in-store mobile payments and loyalty available at an additional 165 stores. Each month our payment infrastructure processes more transactions and our retention for mobile payments is now at 65 per cent.

As opportunities explode for brick and mortar businesses to leverage mobile and the demand for simple, secure and valuable customer experiences increases we will be leading the market. We are committed not only to building a product that our clients value and can deploy to grow their own businesses, but a product that will help to define the future of payments.

Original posting: https://www.linkedin.com/pulse/payments-pivot-our-journey-date-ben-colley

Ben Colley is the Chief Product Officer at LOKE.

LOKE build a cloud-based mobile payment and loyalty platform that enables merchants to deploy and manage their own branded loyalty product. A full-stack POS-integrated solution, the product unifies payments, pre-ordering, customer engagement and loyalty into one simple mobile experience.