Shining the Light on … Lynne Laube of Cardlytics

Lynne Laube, CardlyticsWith the global advertising shift well underway towards a world in which 1-to-1 marketing is the norm, there exists a myriad of opportunities and challenges for technology providers to win the business of large advertisers while maintaining the ongoing trust of consumers.  Lynne Laube, President and Chief Operating Officer of Atlanta-based Cardlytics knows the Polaris-backed company she founded with CEO Scott Grimes has the silver bullet to do just that.  Read on to hear from Lynne about the Cardlytics difference, and what it is going to take to make us all better, safer and happier consumers of advertising in the future.

Explain the Cardlytics business model and how it delivers value to financial institutions, advertisers and consumers.
Cardlytics enables companies to place online targeted advertisements to consumers with one major advantage: We integrate with financial institutions to capture past purchase data and use that information to help companies deliver the most relevant ads to the individual.

cardlytics_incThere is no better predictor of what people are likely to buy than what they have bought in the past, making purchase data extremely valuable to the advertiser.  With this data, companies can target people who are already spending money with them, and encourage them through offers to return as customers.  Or companies can target individuals who spend money with their competitors and entice them to switch over.

The key is obtaining access to this data.  It is here that Cardlytics has a distinct competitive advantage.  We are the only company that has access to real transaction data from our bank clients.  That not only gives our advertisers access to this coveted information, but also protects consumer’s privacy and security.  This combination is the future of 1-to-1 marketing.  We have the “nirvana of data.”

Advertisers can access consumers both within and outside the bank channel. Inside the channel, consumers are offered deals and coupons through their online statements and transactions; outside the bank channel, they will receive targeted banner ads on the sites they are visiting.  The key is that we don’t know anything about your identity; we just know your purchasing habits.

Having come from a banking background, both Scott Grimes (Cardlytics CEO) and I understand the importance of privacy.  We know how financial institutions operate.  We have taken our experience and produced a win-win-win for banks, advertisers and most importantly consumers.

What is your vision for the future of one-to-one marketing and where do you think the largest opportunities lie?

Historically, most marketing and advertising money has been spent on highly inefficient channels such as print and broadcast.  The 1-to-1 marketing model moves from generic ads targeted at the masses to efficient channels where advertisers can engage directly with individual consumers.  As this technology evolves, it will become much more “real time” so that when you log in to your device, your targeted ad will be there.  That will require providers like Cardlytics to access, analyze and present data very quickly.

There is also an opportunity to leverage our commitment to privacy.  This is our secret sauce.  We know that transaction data is extremely valuable.  When we were at Capital One, everyone wanted to buy our data, but banks can’t sell this information outright.  So, how we protect consumer privacy is very important.  When Cardlytics integrates with the bank, we get a random number assigned to each customer.  We don’t know its Joe Smith or Mary Jones.  And we never give the spend data to advertisers.  This way, they can’t buy a person; they can purchase a demographic such as “people who made a Starbucks purchase in the last week.”  Then they can offer those people a discount using their bank card.  People are very sensitive to their privacy.  We protect them in our process.

What are the biggest challenges you face in growing Cardlytics and how will you address them?

One of the biggest challenges is moving those advertising dollars from the current inefficient channels to NEW, more effective channels.  It requires a change in mindset. No advertiser ever gets fired for printing another coupon.  So there is a risk in trying something new.  They have to stop doing something traditional and shift their efforts.  I would estimate that the top 200 retailers in the country cover half of consumer spending in the U.S.  Getting them to try and succeed at 1-to-1 marketing requires providing a great deal of education on our part.

Consumer awareness is also a challenge.  Given our financial institution customer base, it is safe to say that far more than half the country has our product, but doesn’t know yet how to use it. We are working with the banks to get the word out.  The good news is that even with all this work to do around raising awareness, we are still growing revenues at 400% year over year.  It is interesting to note that we already have the consumer engagement levels of bill pay — after bill pay had been around for a decade.  We will ramp up the adoption curve much faster.

Lastly, but most importantly, execution is so important.  Banks are slower moving to make decisions and are incredibly risk averse because they need to be.  As a partner, we need to operate flawlessly every day because we are impacting the banks relationships with their customers.  Therefore, we spend a great deal of time on data security.  However, because our transactions occur behind the bank’s firewall, for Cardlytics to have a breach, the bank would have to be breached.  Still, it is vitally important.

What are the key factors of success for Cardlytics during this phase of the company?

In the early days of the company, our key factor of success was that we were the first mover in terms of building our product for banking.  By the time our competitors realized the opportunity was there, we had fortified strong relationships with our banks which created significant barriers to entry.

Now that we are established and growing rapidly, our focus is on execution AND innovation.  I spend a good deal of time focusing on how we continue to innovate as we grow.   When we were ten people, it was easy.  Now with 250 people on two continents, it is more difficult to collectively think about the next big thing.  But, this is imperative so that we can enjoy the next “first mover advantage” when it emerges.

Who inspires you?  Are there other CEOs or industry leaders you look up to for their leadership qualities?

Our CEO, Scott Grimes, inspires me.  We are very different people and each of us brings something unique to the table.  I think we inspire each other. When companies have two people building something together, you get a better result.

I am also inspired by women around the country who are operating at senior levels in their organizations.  Women like Sheryl Sandberg who talk about real issues have made a huge difference.  In turn, I try to spend my time helping other women, in addition to learning from them.

I am also very inspired by the Cardlytics employees.  This company is not just Scott and me.  We have strong leaders all over our company and it is wonderful to see how our startup has morphed into a company with ideas coming from everywhere.

What is your favorite part about your job?

First, there is nothing like winning that big sale.  I am on the road quite a bit and still play a part supporting our sales team.  Winning a new bank or large advertiser for the first time is a terrific feeling.  Also, watching the people grow in this company is really satisfying.  The people at Cardlytics realize that they are part of something that has the potential to be a big deal.

If you could give advice to a startup CEO, what would it be?

I realize that so much of this type of advice is clichéd.  But my biggest piece of advice is to make sure you really, truly believe in what you are doing.  You will have many naysayers and near death experiences along the way.  If you don’t believe in the company, you won’t survive.

Congratulations to Lynne for being named a finalist for the 2014 EY Entrepreneur of the Year Award.  We are proud to be your partner!

Categories: Polaris

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