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Maritz – A History of Innovation

If necessity is the mother of invention, perhaps innovation is its father.

Earlier this week, it was humbling to receive the top award in the incentive industry for an innovative program with our partner HSBC. The recognition caused me to look back on the history of Maritz and how the company has continuously transformed.

In 1894, Edward Maritz started the E. Maritz Jewelry Manufacturing Company-a wholesaler and manufacturer of fine jewelry and engraved watches.

By 1921, the company name was changed to the Maritz Watch and Manufacturing Company, and Maritz was a leading importer. Business was booming!

Then the Great Depression came. By the end of 1929, only 6 employees remained-including Edward’s sons James and Lloyd. The brothers had to sign over their homes to meet payroll, pay bills and keep the business afloat.

Pioneering the Incentives Industry

To generate income, they began selling watches and engraved personalized jewelry to companies as sales and service awards. The idea of non-cash sales rewards was a new one and caught hold. The concept literally saved the company and launched the incentives industry.

By 1930, a new division was created — Maritz Sales Builders. 

The first nationwide motivation client was Caradine Hat Company of St. Louis. That sale was followed by Chevrolet, Shell Oil, Ralston Purina and several other large accounts throughout the 1930’s.*

Reinvention is in Maritz’ DNA

Fast forward 125 years. The industry is on the cusp of change once again. Chief data officer Jesse Wolfersberger is quick to note that huge technological trends often have humble beginnings. Data, specifically artificial intelligence, has what he calls world-changing potential. Maritz Motivation Solutions and HSBC received the Grand Motivation Masters award earlier this week for an AI-driven pilot that predicted reward preferences in a credit card loyalty program.  While accepting the award Jesse said, “It speaks to where the future of the industry is going and this is just the first step towards engaging customers at a much more personal level.”

It’s doubtful Edward Maritz could have even imagined what Maritz would be today—125 years later. His great grandson and the current chairman and CEO Steve Maritz said, “As we celebrate our 125th anniversary this year, it’s gratifying to be recognized for continuing to reinvent and transform the industry.” 

The Institute for the Future forecasted that 85 percent of jobs that will exist in 2030 haven’t been invented yet. Who knows how Maritz will reinvent itself in the next century?

*A Centennial History of Maritz Inc. by Sid Hutchins.

Four Reasons Why AI Will Change Loyalty Forever

At Maritz, we are making a commitment to AI. This is not a “here today, gone tomorrow” trend. It’s going to become an invaluable tool which transforms industries. Loyalty is one of those industries. In fact, loyalty presents some unique opportunities, which makes it ripe for AI functionality.

Just this week, we partnered with our client, HSBC, on a press release which talks about an AI model we recently piloted with their customers. We trained an AI to predict reward preferences for each cardholder, and then sent a promotional email to each cardholder based on that preference distribution. The results were incredible. Of the cardholders who made a redemption, 70% redeemed in the category that the AI promoted to them. That result tells me that the customers were delighted by this campaign. They received the perfect message which scratched an itch they weren’t even sure they had yet.

We predict it’s such a big part of this transformation, that we are partnering with the Incentive Research Foundation (IRF) in a study focusing on the impact and potential of artificial intelligence and machine learning on the rewards and recognition industry. IRF president Melissa Van Dyke says, “For over half a decade IRF has been discussing how big data and personalization are the next big frontier for the incentive and recognition industry.  We have also repeatedly discovered that many programs owners do not know the power of the data their incentives and loyalty programs offer them.  Artificial Intelligence and predictive analytics are the tools industry can now use to take these trends and turn them into actionable information that makes their programs more motivating.”

This is just the tip of the iceberg. There are countless applications for AI in the industry, and we are excited to be on this journey along with our incredible clients. Here are a few reasons why AI is so important to the future of loyalty:

  • The width and depth of loyalty data. Customer Loyalty has better data than just about any industry. Each touch point with a customer is a chance for you to collect data – every email, every visit, every purchase, every reward. This creates a data story for each customer, but the book is thousands of columns wide and millions of rows deep. A human simply can’t read it well. Only with our modern machine learning methodologies can we take that incredible scope of data and make use out if.
  • The need for personalization. The very fundamental aspect of loyalty programs is that your best customers want their experience with the brand to feel different than the average customer. There are monetary benefits, sure, but the non-monetary benefits can be just as important, if not more. Calling the customer by name, knowing their preferences, knowing their history with the brand are things that make that loyal customer feel that one-to-one connection. With AI, personalization becomes more feasible at scale than ever before.
  • Keeping points fraudsters at bay. The prevalence of fraud, to attack the customer’s account and his or her point balance is a threat that is unlikely to go away. AI will be a valuable ally in the prevention of fraud. Many current fraud prevention systems are based on rules – if this specific thing happens, raise a red flag. This is mostly effective, but all rule-based systems are a little bit like a levee. As soon as the fraudster finds the rule, they can break it wide open and exploit the system again and again. AI fraud prevention systems work a little differently. They adapt and learn, so that the holes in the levee are patched and can never be exploited in that way ever again.
  • The future interface: chat. One very tangible example of AI’s rise is the voice assistants – Google’s Assistant, Amazon’s Alexa, and Apple’s Siri. Customers are becoming incredibly comfortable chatting with an AI system daily. This trend will be felt in loyalty too. As this technology gains maturity, the interactions with AI chat systems will get better and be able to accomplish more for that customer. I predict that, in the near future, customers will prefer interacting with a brand over chat, even if a human is an option, because that chat bot will be able to service the customer faster and easier.

The IRF study will be released later this year, but even now it’s a safe bet to predict AI will have enormous impact. Melissa believes AI will have 10 times the impact the discussion around millennials has had. “For many years it was easier to craft programs based on generations because it summarized the data in a way that seemed actionable.  But our research continuously finds there is an intersectionality that makes a loyalty program’s focus on generations suboptimal. AI offers the incentive and reward space the opportunity to harvest data in ways significantly more impactful on motivation than generational considerations,” according to the head of the IRF.

I’d love to hear how you’re using AI to make a difference and encourage you to share your thoughts in the comments below.