“It took us two years to build the technology alone. We had to raise money just to make it through the partnership process.” So explains Zach Goldstein, founder of Thanx, when discussing the amount of work it took to get Thanx integrated directly with credit card networks Amex, Mastercard, and Visa.
If you’re wondering what Thanx is, it’s a CRM and marketing automation tool for brick-and-mortar merchants. But perhaps most importantly it’s a tool that’s able to measure promotional lift — something we are still shocked to find nearly no merchants do. “Merchants spend money on marketing but rarely know if it’s working. Thanx is able to solve that piece of the puzzle.”
And it’s a big piece.
Ideally Thanx wants to manage all the touch points a merchant has with their customers — from email and loyalty to SMS and social. “Restaurants and retailers should be consolidating all their customer data into a single view so that fewer customers are unknown to them,” says Zach. “Thanx can combine data across systems to move more of your customers into the light and build rich profiles complete with spending data and lifetime value.”
How does this happen?
At every possible brand interaction — be that in-store, on a brand’s website, or from their email list — Thanx is prompting consumers for opt-in to their loyalty program. This loyalty program is custom tailored by each brand but is different in that it asks customers to supply their credit or debit card number. “The best way to ensure consumers are getting all their rewards and that brands learning about their best customers is to design a program that doesn’t interfere with the normal commerce experience. Once a consumer has opted-in, this happens seamlessly with every purchase.”
If you haven’t realized it yet, the magic tool in this value chain is the credit card. “Merchants view credit cards as cost centers. In reality cards should be viewed as the most accurate and clean data feed on consumer patterns, and this should be used to drive upside. So instead of a 3% transaction tax, what if your card could generate 5%, 7%, or even higher revenue growth?”
Thanx even takes this one step further with POS integration. “With access to POS data, we can really pinpoint spending and spending patterns so that promotions can be personally tailored to the individual consumer.” Certain POS systems enable this functionality more easily than others, though Zach was diplomatic in calling out the bad actors.
Zach chose the path he did because the card networks were willing to tokenize card numbers so Thanx could track purchases. In approaching a loyalty solution this way, all the payment data is outside PCI scope. The card networks get an insignificant revenue share for their troubles, though more importantly Thanx provides incentives for customers to use their cards more frequently. So long as Thanx generates a positive ROI for merchants, it makes sense. And the ROI seems pretty strong — “our merchants see anywhere between 0.5% and 3% same store sales growth within the first year.”
This month Thanx is proud to announce that it’s launching a personalized campaign engine. Zach calls it “the first true marketing automation platform for offline merchants.” Thanx achieves this by automatically monitoring customer spending to learn which promotions work and which are best forgotten. One of their best tools, according to Zach, is focused on winning back lapsed guests through Thanx data science algorithms.
Thanx is primarily sold directly to multi-location operators but it has recently launched a highly selective channel program. This program has a standard revenue share arrangement though Zach wouldn’t share specifics. You can reach out to sales@thanx.com if you’re interested.
When we asked Zach who his competitors were, he provided the standard answer of “other loyalty and email marketing providers” but also added that legacy POS players often had their own solutions behind walled gardens and were more combative than helpful to customers that wanted Thanx. Accordingly Thanx has had to “hack” integrations to these POS providers to gain access to useful transaction data… which is precisely the opposite behavior a POS should take as a “business partner”.
At the end of the day Zach says they’re not reinventing wheel, just bringing proven technologies to brick and mortar merchants. “The online ad world changed from cost-per-click to cost-per-conversion as advertisers needed to prove ROI. Is it so crazy for brick and mortar merchants to demand the same?”
No, Zach. What’s crazy is that some POS companies want to force their merchants to use their homegrown solutions, even if it means their customer goes out of business. While companies like Thanx take the leap in driving innovation, it’s the POS companies that are the real bottleneck to progress.
Choose your POS provider wisely.
Add comment