Financial Institutions

Winning the Basket—Part 1: Taking on Google, Apple, Facebook, and Amazon (GAFA)

Allison Ferguson
6 minute read

Cardlytics and our network of banking partners created and then scaled the most influential, trustworthy, and value-focused platform to bring brands and consumers together. Over the last 12 years, our global monthly active users have grown to 178M, and our core value proposition of offering cash-back rewards to bank cardholders remains to this day. But what has changed is the vast digital marketplace in which we compete.

The digital media market is expected to reach a staggering $286B by 2026, creating an immediate opportunity for banks and their customers to capture more partner-funded value from brands. This growth is amplified by the shift in merchant preference for cash-back rewards as compared to investment in social media, according to a recent study by the Digital Commerce Alliance (DCA).

So how can our banking partners capture more partner-funded dollars and consumer spend in the face of this opportunity? The first key to success is driving demand.

Driving Demand: Tackling GAFA

Cash-back offers are so hot that even Google has gotten into the game with the launch of Google Pay Offers in 2020, in partnership with Rakuten. And speaking of Google, it’s just one part of the digital triopoly with which bank-offer programs compete for merchant media dollars.

Google and Amazon control a vast amount of shopping initiation, putting them in the advantageous position to win the basket. Fifty-three percent of U.S. ecommerce searches start with Google, and 40% of global consumers start a product search first on Amazon.

For banks to compete for the consumer mindshare and the payment at checkout, they need to start thinking like the digital giants. They need to drive demand, not wait for it.

Taking on GAFA by Driving Demand

The time for banks to act is now. First, with the deprecation of the cookie and regulatory pressures facing GAFA, banks have an advantage: they are already highly regulated. Second, consumers trust banks to manage their data, with 37% of consumers trusting banks the most. Finally, banks—and, by connection, Cardlytics—have precise transaction data, giving us the advantage on measurement and attribution merchants really want.

So how can banks drive demand? Here are four recommendations:

· Modernize their consumer UX to accommodate expanded advertising budgets such as brand and affiliate media dollars;

· Promote their card-linked offers and cash-back rewards program in card benefits, BAU (business as usual) communication, and dedicated email and mobile communications;

· Publish “beyond the tile” by creating live links to the card-linked offers and cash-back rewards programs throughout their experience and through connected commerce;

· Create more expanded partnerships with merchants in loyalty benefits and other value propositions throughout their organization.

Stay tuned for Part 2 of 4 of our Winning the Basket series. Next, we’ll discuss stimulating cash-back reward activation.

Financial Institutions
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