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ATLANTA, GA – January 23, 2022 – Cardlytics (NASDAQ: CDLX), an advertising platform in banks’ digital channels, today announced the appointment of Amit Gupta as its Chief Operating Officer, reporting directly to Karim Temsamani, Chief Executive Officer.

Effective today, Gupta will lead Cardlytics’ overall operations, strategy, and business analytics, where he will closely align with sales, product, and engineering leadership to deliver an optimized platform that exceeds both advertiser and partner expectations. In addition, Gupta will serve as the general manager of Bridg, where Cardlytics can leverage his experience running and scaling businesses. Amit Jain, current CEO of Bridg, will work closely with Gupta as he transitions out of the business over the next several months.

“Cardlytics is delighted to have attracted such a thoughtful, experienced and operationally strong executive,” said Temsamani. “Amit and I worked together for several years at Stripe, where he always impressed me with his strategic and technical abilities. I look forward to resuming our partnership as we optimize and grow the potential of the Cardlytics business."

Gupta joins Cardlytics from Stripe where he was Head of Strategy and Operations for Global Partnerships, responsible for work with banks, networks, and payment methods. Before Stripe, Gupta was Director of Strategy, New Products, and Operations for Google’s Geo division, leading product and engineering execution and strategy for popular consumer and business products like Google Maps, Local Search, Food, Maps Enterprise Platform, and SMBs. Prior, Gupta founded and was the CEO of a series of startups. He started his career at Booz Allen Hamilton, where he was promoted to Partner in the Technology practice working with clients across media, financial services, and consumer products.

“I am extremely excited to join the Cardlytics team. My background in both advertising and financial technology gives me a unique perspective on Cardlytics’ current capabilities and future product offerings. The product roadmap ahead makes now the perfect time to focus on operational excellence by optimizing the efficiency of the core platform and unlocking the potential of the promising Bridg business. I’m looking forward to helping the team execute on our goals and harness the full power of the platform in such a pivotal moment,” said Gupta.

Gupta holds a Bachelor of Science, Electrical Engineering from The Ohio State University and a Master of Business Administration from the NYU Stern School of Business. He will be based in Cardlytics’ Palo Alto office.

About Cardlytics

Cardlytics (NASDAQ: CDLX) is a digital advertising platform. We partner with financial institutions to run their banking rewards programs that promote customer loyalty and deepen banking relationships. In turn, we have a secure view into where and when consumers are spending their money. We use these insights to help marketers identify, reach, and influence likely buyers at scale, as well as measure the true sales impact of marketing campaigns. Headquartered in Atlanta, Cardlytics has offices in Palo Alto, New York, Los Angeles, and London. Learn more at www.cardlytics.com.

Cautionary Language Concerning Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to future growth and delivery of an optimized platform. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as "expect," "anticipate," "should," "believe," "hope," "target," "project," "goals," "estimate," "potential," "predict," "may," "will," "might," "could," "intend," or variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond our control.

Our actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to the risks detailed in the “Risk Factors” section of our Form 10-Q filed with the Securities and Exchange Commission on November 1, 2022 and in subsequent periodic reports that we file with the Securities and Exchange Commission. Past performance is not necessarily indicative of future results.

The forward-looking statements included in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments will cause our views to change. We undertake no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

Contacts:

Public Relations:

Robert Robinson

pr@cardlytics.com

Investor Relations:

Robert Robinson

ir@cardlytics.com

• Tighter budgets drive consumers to discounters, with spend at brands like TK Maxx, B&M and Home Bargains up 12% in the first half of this year, with transactions up 17%
• Average spend at second-hand marketplaces rises 482% between 2019 and 2022, as consumers search out second-hard bargains 
• Spend shifts from designer brands to the high street, as spend at high street brands rises 11% in 2022¹, while the number of transactions at luxury brands falls 10%

LONDON – 8th November 2022 – Cost-conscious consumers are switching to discount brands and second-hand marketplaces which saw double digit spending growth in the first half of the year, a new report from advertising platform Cardlytics finds. 

The State of Retail Spend report, based on the spending habits of over 24 million UK bank cards and the views of over 2,000 UK consumers, found that four in five (79%) consumers report spending more on day-to-day outgoings than they did a year ago, while with three quarters (72%) say they plan to cut-back on non-essential spending this year as the cost-of-living crunch sets in.  

Discount brands see boom in spend 

As costs increase and consumers look to make their money stretch further, the report found that over half (58%) of consumers plan to shop more at discount homeware and fashion brands this year.

Discount retailers such as B&M, TK Maxx, Home Bargains and Primark saw the largest increase in spend in the first half of this year, up 12% compared to 2021¹, whilst the number of transactions at these brands rose 17% in the same period.

Second-hand becomes mainstream 

The report also found that increasing numbers of consumers are turning to second-hand marketplaces in response to the cost-of-living squeeze.

Platforms like eBay, Depop and Vinted, saw a 7% uptick in spend in the first half of the year, compared to the same period in 2021, while the average number of transactions made on these platforms rose 6%.

It’s not just the number of purchases that are increasing, the amount spent per person has also risen drastically in recent years. In 2019, consumers spent £35.67 on average on second-hand marketplaces, compared with £207.63 in 2022 – a 482% rise.

That trend is set to continue as prices rise and consumers become increasingly aware of the environmental impact of buying new. The report found that one in three (34%) consumers plan to buy more second-hand items this year, while half (47%) of consumers say they plan to shop less at fast-fashion brands this year.

On the other hand, fast-fashion brands are starting to feel the impact of this mindset shift, with the number of transactions at these retailers down 16% in the first half of this year compared to 2021. 

Shoppers choose high street brands over designers 

Spend on luxury and designer brands fell 7% in the first 6 months of 2022, compared to 2021, while the number of transactions at luxury brands dropped 10% in the same period, indicating that consumers aren’t just spending less on designer and luxury goods, but are turning away from these brands altogether.

This downward trend looks set to continue into next year, with over half (59%) of consumers planning to spend less on luxury goods this year, while a further half (48%) plan on switching to cheaper brands for clothing and homeware as the cost-of-living bites.

Traditional high street retailers are already benefitting from the gap that luxury leaves, with both total spend and the number of transactions at high street fashion brands up 11% in the first six months of 2022, compared with 2021³ as consumers ‘trade down’ when shopping.

Home and garden spend dries up

The past two years saw bumper spend at home and gardens brands as lockdowns fuelled renovations, but withthree in five (61%) consumers planning to cut back on big-ticket purchases this year this upward trajectory may have reached its peak.  

The report found that consumers are still committed to improving their outdoor space, but they are increasingly looking to do so in ways that don’t break the bank. The number of transactions at garden centres rose 22% in the first 6 months of 2022, compared to the same period in 2021³, but the average transaction value fell 20%³, suggesting that consumers are continuing to shop at these brands but are spending less when they do. 

It's a similar picture for high street furniture brands who are increasingly feeling the impact of shifting consumer spending priorities. Spend at furniture brands fell 20% in the first six months of this year compared to the six months prior³.  

Dawn Reid VP Advertising Partnerships at Cardlytics said: “We know that even in times of economic downturn, consumers still want to find ways to treat themselves, refresh their wardrobes or invest in their homes. 

“But with tighter budgets than ever and the economic picture set to worsen, consumers are looking for cheaper swaps and ways to save, putting off big ticket purchases and trading down on many of their usual purchases.

“There's an opportunity for retailers to invest now, to support consumers longer term, whether through investing in price and discount ranges, value-focused marketing, or loyalty schemes, brands can put money back into their loyal customers wallets and help build longer term brand affinity. Those brands that can grow and retain their customer base now, when times are tough, will be most likely to succeed in future.”

Download the UK State of Spend report here.

About Cardlytics

Cardlytics (NASDAQ: CDLX) is a digital advertising platform. We partner with financial institutions to run their rewards programs that promote customer loyalty and deepen relationships. In turn, we have a secure view into where and when consumers are spending their money. We use these insights to help marketers identify, reach, and influence likely buyers at scale, as well as measure the true sales impact of marketing campaigns. Headquartered in Atlanta, Cardlytics has offices in London, New York, Los Angeles, San Francisco, Austin, Detroit, and Visakhapatnam. Learn more at www.cardlytics.com.

Energy bills are at an all-time high. Mortgage rates are at the highest level for 14 years. Last week the cost of a weekly shop rose at its fastest rate since 1980. 

While we all wait for the outcome of the Government’s budget in November, there’s only one question on retailers and shoppers' lips: when will prices stop rising? 

As inflation keeps creeping up, it’s fundamentally altering what consumers buy and how they shop. Our latest research found that three quarters (72%) of shoppers plan to cut-back on non-essential spending this year as the rising cost-of-living sets in. 

But, heading into a recession doesn’t always mean spending disappears. More often than not, spending just changes shape. 

Our new spending report, based on the spending insight of one in four UK bank accounts, found that increasing numbers of shoppers are turning to second hand marketplaces in response to the cost-of-living squeeze, swapping new for second hand in a bid to bag a bargain. 

Platforms like eBay, Depop and Vinted saw a 7% uptick in spend in the first half of the year, compared with the same period in 2021¹, while the average number of transactions made on these platforms rose 6%.

Strikingly, this growth isn’t just coming from an increase in the number of people buying second hand – the average spend per person has also skyrocketed by 482% in the past three years, from £35.67 in 2019 to £207.63. No longer just a budget option, second hand fashion is increasingly the go-to for buying clothes. 

There’s no arguing that the cost-of-living crisis is accelerating a trend towards second hand shopping in search of better value. But the shift to second hand was already on the rise as the impact of the fashion industry on the planet was made all too evident.

Almost half (47%) of shoppers say they plan to shop less at fast-fashion brands this year, and we’re seeing this play out across our spend data; spend on online fast fashion brands was down 4% year on year in the first six months of 2022, while the number of transactions fell by 16%.

The cost-of-living crisis will undoubtedly make it more challenging for fashion retailers, as the competition for people’s dwindling disposable income gets tighter. Brands will need to work harder to keep and grow their customer spending and their market share.

Harnessing the shift towards sustainability provides an opportunity to do this. While focusing on sustainability as a retailer has a positive impact on the planet and brand reputation, it increasingly also comes with benefits to a business’s bottom line.

We’re already seeing some retailers take steps to introduce second hand or upcycled ranges, or even their own resale platforms, such as Zara’s newly launched pre-owned service or Urban Outfitters’ ‘Urban Renewal’ upcycled range. Even high street heavyweights like John Lewis are trialling their own fashion rental service.

Rewards programmes that encourage second hand purchases or recycling clothing are another way to capitalise – for example offering discounts on end of line goods, or vouchers or cashback for bringing in clothes to be recycled can help drive further spending. 

Done right, these moves can not only improve brand perceptions, but turn into lucrative revenue streams. 

The cost-of-living crisis and tighter budgets have converged with a desire to reduce overconsumption and shop more consciously and the trend is showing no signs of slowing. 

Fashion brands that act now to capitalise on consumer concerns for their purse strings and the planet will reap the rewards in the long run.

Download the UK State of Spend report here.

Loyal customers are your brand's biggest sales opportunity–spending an average of 67% more than comparable transient consumers.

A new era in consumerism is ushering in highly personalized service models and deep, lasting relationships with a loyal customer base. This shift towards relationship marketing emphasizes building a strong customer loyalty program to facilitate that relationship.

Key Takeaways:

• Personalized experiences create brand affinity and drive loyalty. 
• Strong relationships transcend temporary instabilities such as a recession.
• 52% of consumers choose brands based on loyalty programs

What is relationship marketing?

Relationship marketing is a long-term strategy that creates opportunities to nurture customer relationships. For many brands, repeat customers are willing to spend more and happy to keep coming back.

It's still just one piece of the marketing puzzle, but priorities are shifting. Instead a singular focus on new conversions, a relationship marketing strategy invests in retaining the customers that have already converted.

From a return on investment perspective, it's a logical approach.

A relationship marketing strategy might include:

• Obtaining and Listening to Customer Feedback
• Curating Personalized Experiences
• Enhancing Customer Service Delivery
• Establishing a Rewards Program
• Embracing an Omnichannel Approach

Why relationship marketing is important

Consumers increasingly demand deeper commitments from the brands they shop with. According to Salesforce, 73% of customers now value trust when choosing where to shop. Understanding relationship marketing and customer loyalty can help companies connect with their consumers.

Increased Sales Opportunities

Focusing on customer relationships can increase customer loyalty. This benefits the brand in several ways. First, customer acquisition costs go down while sales numbers likely go up. Loyal customers spend more–and more often.

Second, loyal customers stick around. In one survey, 75% of loyalty customers had been with a brand for over a decade. Imagine the purchasing power of an engaged customer over 10 years.

Generating Brand Awareness

Loyal customers are your strongest advocate. A deep-rooted part of our social human nature hinges on modeling behaviors. We're born with the instinct to mimic, look for examples, and adopt modeled behaviors from those around us. We’re also equally inclined to share or model for those around us. 

For brands, this means that happy, loyal customers are eager to share the good news. And interested prospects are willing to hear it turning loyal customers into a perfectly primed engine for boosting brand awareness.

Long-Term Stability

Strong relationships transcend temporary instabilities. A dip in the economy often leads to consumer pullback on spending. When buying resumes, purchase power is fair game. Brand loyalty is the tie that binds bringing familiar faces back to the brands they trust.

Relationship marketing drives loyalty and retention

If repeat business drives sales growth, the hidden potential in loyalty-driven retention is an opportunity many brands have not yet fully realized. As marketers lean into creating customer experiences and cultivating deeper engagement through emotional connection, both brands and consumers benefit from relationship marketing.

Consumers get a positive, personalized experience ripe with satisfaction. Brands see more sales, a better return on ad spend, and growing loyalty that continues to feed an efficient marketing cycle.

Relationship marketing strategies to increase customer loyalty

The key to increasing customer loyalty is in your approach to managing that relationship. Let's look at effective ways to make the most of your relationship marketing strategy.

Customer feedback

Obtaining customer feedback through surveys and using that data to inform business decisions like product development, marketing strategies, customer service models, and supplemental services provides a brand with the best chance of finding and fulfilling customer needs. 

On top of providing genuine solutions, customers feel satisfied when their needs are heard and addressed. Engaging a 360-degree customer feedback model grows brand affinity through deep satisfaction creating loyal customer relationships.

Personalized experiences

Nobody likes to feel like another face in a crowd. We're wired to belong but driven to stand out. As consumers, we want the accessibility of commercial products delivered with personalized service. 

Brands can use intel generated from quality first-party data streams to personalize customer experiences. Doing so creates a sense of familiarity that breeds trust while simultaneously addressing the ego and connecting with customers emotionally to build loyalty.

Great customer service

It sounds simple – deliver great service and win customer loyalty. The problem is that priorities shift, and balls get dropped. While most brands would like to believe they're providing great customer service, reality paints a different picture.

The majority of consumers base purchasing decisions on the level of service they receive. This means providing attentive service from knowledgeable, trained staff. This can increase customer loyalty better than offering a lower price.

Rewards programs

Consumers love incentives. Over half (52%) of consumers say that loyalty programs influence their decisions to shop with a particular brand¹.

A rewards program is a specific type of loyalty program. Rewards increase the perceived value from the customers' point of view, providing a strong anchor for maintaining loyal customers. It's a simple concept, reward your most loyal shoppers for every dollar spent with your brand, and they'll spend more. 

First-party data from Cardlytics can help brands identify loyal customers and customers at risk of leaving based on the share of spend in competitive categories. This data can then help brands personalize rewards based on unique customer relationships. 

Omnichannel approach

An omnichannel approach recognizes that customers engage in a variety of ways. The same consumers who shop in stores will also interact with the brand on social channels. Similarly, shoppers that gravitate toward in-app purchases might also be eager to leave reviews on aggregate sites.

Customers aren't siloed to independent channels, and your marketing strategy shouldn't be either. An omnichannel approach builds trust and loyalty by providing a cohesive brand experience across all touchpoints.

With an omnichannel approach fueled by Cardlytic's first-party data, brands can easily identify new or lapsed customers so that you can deliver personalized re-engagement offers through uniquely personalized messaging and offers.

How Cardlytics Helps Brands Grow Customer Loyalty With Strong Relationship Marketing

The untapped potential in your loyal customer base can be reached through effective relationship marketing. Cardlytics solutions can support a stronger loyalty program by providing unique insights on customer behavior, including the share of wallet spend across competitive brands. Your brand can use this information to provide personalized offers to engage and re-engage customers every step of the way.

Sources:

¹“Shopper Story 2020: The New Consumer Mindset,” Criteo, 2020

Atlanta, GA – November 1, 2022 – Cardlytics, Inc. (NASDAQ: CDLX), a digital advertising platform, today announced financial results for the third quarter ended September 30, 2022. Supplemental information is available on the Investor Relations section of Cardlytics' website at http://ir.cardlytics.com/.

“We delivered solid double-digit growth despite the serious challenges present in the economy,” said Karim Temsamani, CEO of Cardlytics. “While the economy may be uncertain, I believe there is inherent resiliency in platforms that prove return on ad spend, and I am positive that we can grow profitably. There is a large opportunity ahead of us, and we will be disciplined in Q4 and beyond as we prioritize our goals and position the company well for the next ten years.”

“Our results this quarter were in line with our expectations given our clients' concerns about the economy,” said Andy Christiansen, CFO of Cardlytics. “There is a wide range of outcomes for Q4, but our highest priority is meeting our profitability and cash flow goals for 2023. We are focused on taking the necessary steps to ensure we can control our destiny and achieve our long-term goals.”

Third Quarter 2022 Financial Results

• Revenue was $72.7 million, an increase of 12% year-over-year, compared to $65.0 million in the third quarter of 2021.
• Billings, a non-GAAP metric, was $110.4 million, an increase of 12% year-over-year, compared to $98.4 million in the third quarter of 2021.
• Gross profit was $26.0 million, an increase of 6% year-over-year, compared to $24.5 million in the third quarter of 2021.
• Adjusted contribution, a non-GAAP metric, was $35.1 million, an increase of 11% year-over-year, compared to $31.6 million in the third quarter of 2021.
• Net income attributable to common stockholders was $6.3 million, or $0.19 per diluted share, based on 33.3 million fully diluted weighted-average common shares, compared to a net loss attributable to common stockholders of $(44.5) million, or $(1.35) per diluted share, based on 33.1 million fully diluted weighted-average common shares in the third quarter of 2021.
• Non-GAAP net loss was $(16.5) million, or $(0.50) per diluted share, based on 33.3 million fully diluted weighted-average common shares, compared to non-GAAP net loss of $(11.0) million, or $(0.33) per diluted share, based on 33.1 million fully diluted weighted-average common shares in the third quarter of 2021.
• Adjusted EBITDA, a non-GAAP metric, was a loss of $(12.7) million compared to a loss of $(5.2) million in the third quarter of 2021.

Key Metrics

• Cardlytics MAUs were 184.7 million, an increase of 8%, compared to 170.6 million in the third quarter of 2021.
• Cardlytics ARPU was $0.36 in the third quarter of 2022 and 2021.
• Bridg ARR was $22.1 million in the third quarter of 2022.

Definitions of MAUs, ARPU and ARR are included below under the caption “Non-GAAP Measures and Other Performance Metrics."

Fourth Quarter 2022 Financial Expectations

Cardlytics anticipates billings, revenue, and adjusted contribution to be in the following ranges (in millions):

 Q4 2022 GuidanceBillings⁽¹⁾$120.0 - $132.0Revenue$80.0 - $90.0Adjusted contribution⁽²⁾$38.0 - $44.0

1. A reconciliation of billings to GAAP revenue on a forward-looking basis is presented below under the heading "Reconciliation of Forecasted GAAP Revenue to Billings."
2. A reconciliation of adjusted contribution to GAAP gross profit on a forward-looking basis is not available without unreasonable efforts due to the high variability, complexity and low visibility with respect to the items excluded from this non-GAAP measure.

Earnings Teleconference Information

Cardlytics will discuss its third quarter 2022 financial results during a teleconference today, November 1, 2022, at 5:00 PM ET / 2:00 PM PT. A live dial-in will be available after registering at http://ir.cardlytics.com/. Shortly after the conclusion of the call, a replay of this conference call will be available through 8:00 PM ET on November 8, 2022 on the Cardlytics Investor Relations website at http://ir.cardlytics.com/. Following the completion of the call, a recorded replay of the webcast will be available on Cardlytics’ website.

About Cardlytics

Cardlytics (NASDAQ: CDLX) is a digital advertising platform. We partner with financial institutions to run their rewards programs that promote customer loyalty and deepen relationships. In turn, we have a secure view into where and when consumers are spending their money. We use these insights to help marketers identify, reach, and influence likely buyers at scale, as well as measure the true sales impact of marketing campaigns. Headquartered in Atlanta, Cardlytics has offices in London, New York, Los Angeles, San Francisco, Austin, Detroit and Visakhapatnam. Learn more at www.cardlytics.com.

The grocery industry is undoubtedly a bellwether for the impact of the cost-of-living crisis on consumers. While costs are rising in many places, the price of everyday basket essentials remains a proxy for inflation. 

That puts grocers at the epicentre of the debate when it comes to how and whether they should be looking after their customers in such challenging times. 

Every grocer is battling rising operational costs, from the increasing energy cost of keeping freezers and fridges cold through to the price of fuel for home deliveries. How can brands still support their customer base through tough times, while still protecting their bottom line? 

Invest in essentials to support tighter budgets

Cardlytics spend data across 24 million UK bank accounts shows that since 2020 the average cost of the weekly shop has increased by 20%. The rising pressures of inflation, supply chain issues and labour shortages are all forcing the price of everyday essentials up. 

A recent Cardlytics poll of 2000 UK adults found that almost nine in ten (88%) consumers have seen a rise in their weekly shop. As wages stagnate, and bills look to skyrocket, they’ll be searching for any way possible to save a little extra cash.

Use loyalty schemes to engage customers

One option is to increase investment in the basics. Asda’s launch of a new essentials range is one example of how a brand is stepping up and keeping the price of essentials low.

But with cost now becoming a clear deciding factor in where to spend, consumers are increasingly shopping around to save the pennies. Our spend data shows that in the past year, total spend at the big four supermarkets fell 7% and spend at convenience stores fell 8%, whilst discount supermarkets managed to uphold their market share in an increasingly competitive industry.

A new basics range might help at one end of the spectrum, but if consumers are then shopping elsewhere to fill the rest of their basket, how much is it really helping?

With over 56% of consumers saying they’re looking to shop with cheaper brands to save money, grocers should consider how they can make customer loyalty the priority. Investing in loyalty programmes that help customers save money on their shop – be it offers on the items people buy most or rewards each time they shop – will go some way to help grocers hold on to their customers and attract new ones.

Cardlytics is able to provide brands with a ‘whole wallet’ view, to understand what share of a customer’s category spend they’re receiving and how much headroom a customer has to make sure they’re targeting the most relevant and valuable customers.

Invest in price, play the long game

Every grocery retailer faces an ongoing battle to support their customers, however, as the cost-of-living ramps up, it’s crucial that additional costs aren’t passed on to the consumers. Otherwise, brands risk losing their loyal customer base and may struggle to defend their market share – especially in the run up to the all-important ‘Golden Quarter’. 

By investing in price now to support customers when budgets are tight, grocers can win longer-term brand loyalty for helping customers when they needed it the most.  

Those brands that step up to support customers now, will reap the rewards in the long term. 

With the growing concern around inflation, recession, and the rising costs of digital ad prices, many marketers are challenged to stretch their budgets and shift marketing dollars to where they elicit the most value. 

Cardlytics joined forces with Nielson and Digiday to discuss how marketers can use campaign metrics experimentation to refine their strategies and achieve measurement confidence.

Watch the recording of the webinar and see Trevor Wooden, VP of Analytics at Cardlytics and Tsvetan Tsvetkov, SVP of Nielsen Outcomes at Nielsen discuss how marketers can best prove marketing impact while navigating numerous economic uncertainties.

https://youtu.be/tqVC79Vwg_Y

The travel industry has faced an uphill battle over the past few years. Covid-19, cancellations, labour shortages and rising operating costs have all beset the industry with issues. 

Many punters have in turn forgone their normal holidays abroad or ditched the business travel, swapping flights to Portugal for trains to Cornwall and face-to-face meetings for Zoom calls.  

It was therefore unsurprising that as restrictions lifted, travel spend skyrocketed as consumers made up for lost time, splashing the cash to make their next trip better than ever. 

Cardlytics spend data across 24 million UK bank accounts shows that travel brands across the sector have seen spend increase in the past year. Total spend on airlines grew 542% between 2021 and 2022 whilst package holiday’s (496%), holiday rentals (222%) and even UK retreats (111%) saw significant rises in the same period. 

However, headwinds loom. The industry is facing unprecedented staff shortages, while a cost-of-living crisis is likely to put a squeeze on the amount consumers are willing to spend on their holidays. 

Looking to the next 6 months, how can travel brands win back customer loyalty as we head towards the winter travel and January holiday booking season?

Invest in certainty

Overall spend on package holidays has increased by 171% in the past six months compared to prior same period, pointing to the fact that consumers are increasingly opting for package deals that offer more protection and support when things go wrong.  

Investing in certainty will go a long way in helping to rebuild trust and get consumers booking their trips again, whether it is offering extra protection on holidays or the choice for free cancellation, giving consumers choice and backup options will help to incentivise bookings. 

Focus on affordable getaways

Despite the post-Covid boom in bookings, the cost-of-living crisis will tighten purse strings and as consumers cut-back on non-essential spending, luxuries like holidays could be one of the first things to go. Recent Cardlytics consumer polling of 2000 UK adults shows that two in five (42%) consumers are already planning to reduce the number of holidays they take this year.

As travel brands struggle themselves with increased operational costs and inflation, prices are only set to rise. The average spend per purchase across the travel sector has already seen an increase of 26% in the past 6 months compared to the previous 6 months.

With prices increasing, consumers are likely to opt for shorter mini-breaks and more affordable destinations. For brands, this is an opportunity to offer more flexible and value driven options that suit peoples’ needs now but help to retain customers in the long term.

Reward customers and build loyalty

Disposable income is continuing to decline, leading to more consumers turning to loyalty programmes and discounts to save. Our consumer research showed that 59% of consumers are reacting by utilising discounts, rewards, and offers by searching for more discount codes online before they make a purchase.

Travel brands need to seize this opportunity to offer tailored incentives to help their customers save money but also build loyalty and ensure they keep coming back. The travel industry is renowned for its loyalty programmes, now is the time to take them up a notch. 

List with price comparison sites to increase exposure

Consumers aren’t just looking to discount codes to save their spending. Cardlytics consumer polling showed that 73% of consumers plan to shop around more this year for the best deals whilst 58% intend to use price comparison sites more. 

Brands need to tap into this savvy customer base by featuring on price comparison sites. This not only increases visibility and exposure but also makes it easier for customers to find a brand’s deals.

There are infinite ways to measure the success of a marketing campaign. Still, one of the marketers' top challenges comes when it's time to quantify campaign success in terms of actual revenue dollars. Making the leap between marketing metrics and business outcomes often requires collecting data from multiple platforms, connecting the dots, and filling in the blanks. 

Traditional marketing performance metrics simply aren't the most accurate for measuring business success, but newer platforms and tools enable a better alternative — incrementality marketing. Incrementality takes a different approach to metrics like attribution, lift, and ROI, which means learning new strategies and measurement plans.

What is incrementality marketing, and why is it important?

Incrementality is a way to measure the impact a certain marketing activity has on a desired business outcome. Incrementality helps marketers discern what portion of success can be attributed to campaign efforts versus which results would have occurred organically without a specific marketing interaction or touchpoint.

Collecting and using third-party data for marketing campaign targeting and optimization is increasingly difficult and costly. Privacy and tracking regulations will only become stricter in the coming months and years. With the shift toward first-party data and tracking comes the need for new tools and methodologies.

In a Cardlytics study, we discovered a major disconnect between the outcomes businesses deem important and the effectiveness of current marketing initiatives at achieving those outcomes. For example:

• 72% of retail executives said "gaining competitive market share" is one of their top three priorities from performance marketing investments.
• But 61% said current performance marketing initiatives are ineffective in terms of helping them gain a competitive market share.

Clearly, retailers are hungry for initiatives that actually drive results. The ineffectiveness of current approaches necessitates a shift to methodically shape marketing strategies and measure campaign success.

Strategies for incrementality

Incrementality marketing may seem complex, but that's mainly because it has historically been difficult to measure. There is good news, though. The shift from third-party data makes incrementality more important and easier to implement. With privacy regulations shielding customer data from marketers, incrementality measurement and first-party data will soon reign supreme.

In the past, many online marketing tools and platforms simply didn't collect the data needed to measure incrementality with confidence. This meant marketers relied on metrics like ad views and click-through rates to make assumptions about campaign performance. Now, the latest customer data platforms (CDPs) move beyond these traditional KPIs and dial into exactly which digital efforts have an impact on sales — all while providing a more seamless experience for marketers and consumers alike.

In addition to having the right tools in place to prioritize incrementality marketing and measurement, marketers need a mindset shift to understand which of their efforts truly moves the needle.

Moving from engagement to growth as KPI

Increasing user engagement is a common goal for performance marketing campaigns. Common customer engagement KPIs include:

• Email open rates and click-through rates
• Ad clicks
• Social media engagement
• Session duration

Brands want to drive customer engagement because of the assumption that engaged customers will spend more money, shop more frequently, and make recommendations to friends. These assumptions may be true, but they're difficult to prove with hard data — especially because most engagement campaigns rely on third-party data for audience targeting and tracking.

To make the shift to an incrementality mindset, move away from engagement-focused KPIs and focus on growth-focused KPIs. Growth KPIs include things like:

• Customer lifetime value (CLV)
• Incremental revenue
• Competitive market share
• Category wallet share

These KPIs provide a better picture of campaign success — as long as you can accurately attribute outcomes to specific marketing efforts. This ties back to the importance of first-party data. Clicks, views, and other engagement metrics will never be as precise as growth metrics measured with data from first-party sources such as customer transactions.

Focus on gaining competitive market share

One of the key growth-based KPIs marketers should focus on as they shift to an incrementality mindset is competitive market share. As with other incrementality measurement methods, quantifying competitive market share can seem like a tall order — especially if your current platforms and tools are limited in terms of targeting and other performance measurement capabilities.

If this challenge sounds familiar, you're in good company. For example, 76% of advertisers do not currently have the capabilities to define an audience or develop a campaign targeting high-spending shoppers in their category who have not spent with them for a defined timeframe.

This may seem like an extremely specific segment to target. Still, this level of specificity is within the realm of possibility when you prioritize marketing tools that combine strategic first-party customer data and robust in-platform intelligence.

Adopt an omnichannel approach

If you're an omnichannel advertiser, do your performance marketing and measurement efforts reflect that? Chances are, there is some disconnect between your online and in-store campaign measurement. Our study found that 84% of marketing executives cannot tie in-store purchase data directly to performance marketing campaigns.

Historically, it has been difficult — even impossible — for marketers to connect online marketing efforts to in-store sales accurately. Strategies such as buy online, pick up in-store (BOPIS) help bridge the gap between eCommerce and in-store shopping experiences. However, there's still a disconnect between online and brick-and-mortar attribution. An omnichannel approach to sales and measurement is needed to capture your marketing efforts' impact fully.

How do you measure incrementality?

Measuring incrementality requires comparison and experimentation, typically with split-testing and control groups. As you begin, you'll first need a baseline understanding of expected revenue without any marketing efforts. You may need to pause your marketing efforts for a time to collect accurate data.

Next, pick an audience to segment into a test group and control group, and serve your marketing campaign to the test group only. Comparing the two groups' conversion rates will help you determine the incremental impact of the campaign.

Driving incremental revenue is a major priority for business executives and marketing leaders, but the two groups disagree on exactly how to measure it. There's a further issue — many businesses measuring incremental market share are not satisfied with their methodology.

• 81% of executives say that incremental market share is important
• 69% do not measure it
• Of those that do measure it, 83% are dissatisfied with how they're measuring it

Some of this disconnect arises because most traditional performance marketing metrics are simply inadequate for measuring incrementality. Any brands seeking to learn how to measure incrementality should start with revising their performance evaluation methodologies.

Attribution vs. incrementality

Attribution is the practice by which marketers discern which marketing touchpoints lead customers to a particular action or event. According to our study assessing over 250 business and marketing executives, 86% are currently relying on classic attribution methods, such as:

• Single-touch attribution models assign 100% of the credit for a conversion to one marketing touch point, such as the first or last touch.
• Position-based attribution splits the credit for a sale between the first and last touchpoints — also known as a U-shaped attribution.
• Multi-touch attribution models distribute attribution between various touch points.

The problem with these attribution models is that they can only approximate a digital campaign's impact and can't account for a buyer's full journey. They also don't account for offline touchpoints such as print ads, in-store signage, or promotions.

There is a more robust alternative to these attribution models: closed-loop attribution. Closed-loop attribution is a data-backed way for marketers to know exactly how a specific marketing channel or campaign contributed to sales and revenue. With closed-loop attribution, marketers can connect actual online purchases to specific digital campaigns to gain a clearer picture of the impact of their initiatives.

ROAS vs. iROAS

Another shift marketers need to make on their way to better incrementality measurement and analysis is the move from traditional return on ad spend (ROAS) measurement to incremental return on ad spend (iROAS) calculations. 

Calculating ROAS is straightforward. You simply divide the revenue attributed to your marketing campaign by the cost of that campaign:

Revenue / campaign cost = ROAS

ROAS is a classic way to measure the success of an ad campaign, but it doesn't take incrementality into account. To find your iROAS, the formula is very similar:

Incremental revenue / campaign cost = ROAS

The main difference in the incrementality model is the understanding that only a portion of your campaign revenue can be confidently attributed to your paid marketing efforts and would not occur without your campaign. Realistically, a portion of your campaign revenue would have come through regardless of your paid marketing efforts, and iROAS accounts for that.

Cardlytics is the incremental marketing tool you need

Your incrementality efforts will only be as good as the tools you use to craft and measure your campaigns. Cardlytics helps marketers measure the true impact of their digital campaigns — not just overall sales increases but incremental returns. With access to 179 million bank customers' real transaction data, Cardlytics gives brands a goldmine of first-party data, omnichannel attribution opportunities, and streamlined performance measurement and reporting.

More precise targeting based on first-party data

Third-party data is more expensive to attain and less accurate than first-party data. Also, third-party data is dying. With Cardlytics, campaign targeting is informed not by third-party data but by one out of every two card swipes in the US. 

Cardlytics worked closely with Dunkin' Donuts to identify which customers were most likely to be repeat customers based on first-party data — specifically, past purchase behavior with Dunkin' and its competitors. Cardlytics targeted this "likely to return" customer segment with cash-back offers via their online banking platforms, giving them an incentive to buy themselves a treat at Dunkin'. This campaign would not have been possible if Dunkin' had only relied on third-party data.

More accurate omnichannel attribution

What typically happens when someone sees an ad for a retailer online but then purchases in the brick-and-mortar store? There has historically been no way for that purchase to be accurately tracked and attributed to the online touchpoint. Cardlytics changes that. 

Because Cardlytics campaigns are based on bank transaction data, it doesn't matter where those transactions occur. Every time a customer swipes their card, there's a new data point Cardlytics can use for campaign targeting and reporting.

Straightforward performance measurement

Cardlytics eliminates the need for data interpretation, estimation, and assumptions. Our data comes from real purchases made by real people. Our campaign reports are based on real transaction data from people who saw ads on our digital ad platform. It's all first-party data, and it's easy to see results. When you launch a campaign with Cardlytics, we'll be able to report on growth-based KPIs such as:

• Long-term customer value
• Incremental return on ad spend
• Impact on overall market share 

With Cardlytics, retailers become market leaders well-positioned for omnichannel success.

Taking the next step with Cardlytics

It's hard to imagine marketing without third-party data and traditional KPIs, but the marketing landscape is changing whether we like it or not. Retailers must embrace incrementality and first-party data to remain competitive in the coming years. Learn more about marketing solutions and campaign measurement from Cardlytics, and contact us for more information.