News@Direxions

In the right Direxion


Through its recent collaboration with Canada-based Loyalty One, loyalty programme provider, Direxions, is looking to capture a client base in new geographies
| Posted by Kanchana Banerjee
"The loyalty market in India is only going to get more exciting and interesting.With Canada's Loyalty One, There is going to be a lot of activity as the players in banking, credit card, mutual funds. telecom and the broadband space will require innovative loyalty programmes which in turn, will play a big role in their marketing strategy"

“The direct marketing and loyalty management space in India is in a very exciting and interesting phase. It has come a long way from what it was in the late 1980s and today, the space is buzzing with a lot of activity,” says Brian Almeida, managing director, Direxions. Almeida is well aware of the market since Mumbai-based Direxions was among the first companies to make headway in loyalty programme management in India. One of its early initiatives was British Airways’ (BA) first international frequent flyer programme in 1998. Others like Jet Airways’ ‘Jet Privilege’, Shoppers Stop’s ‘First Citizen Club’ and Bharat Petroleum’s ‘Petro Card’ – the longest running loyalty programme in India (12 years), are just a few examples of the work Direxions has done. Recently, the company made headlines for its collaboration with Canada-based Loyalty One, a global player in the loyalty management space. The latter acquired a 26 per cent stake in Direxions – an important milestone in the journey of Direxions since its inception in 1989.

In the beginning

“It was the foresight of the Late Vivek Basrur who thought about direct marketing (DM) and relationship marketing much before its time,” says Almeida. Alongside Basrur and two other partners, Almeida established Direm (now Direxions) at a time when DM was unheard of as a concept. Having started small with an investment of the founders’ personal capital, Almeida identifies the BA loyalty programme as the company’s big break. “After that, it was Jet Airways’ Jet Privilege programme in 2002,” he says.
Even as the company made its first strides, it was faced with the challenges of operating in this space. According to Almeida, at that time, the market did not understand the value of relationship management or investing in loyalty programmes. Also, data infrastructure was a big stumbling block. India, unlike the West, lacked data compilation on consumer psyche and spending habits that are considered the backbone of this industry. Through this wavering period, Direm was opening up the industry by envisioning ways to address these problem areas. The company began by gathering data from credit card companies and direct response advertising companies. Importantly, it also went about generating awareness amongst companies on how the process of understanding consumers could help cut down on new consumer acquisition costs.

Changing monikers

In 2007, the company’s first significant change came about: it was rebranded as Direxions. This change also marked new offerings in terms of technology, digital and mobile solutions. “Our pursuit to be more data driven and strong in analytics has led to the birth of two additional companies – Cartesian Consulting and Red Box.” While the former offers consultancy services to understand the client’s business and customer analytics, the latter manages the rewards and incentives part of the business. “Through these three companies – Direxions, Cartesian Consulting and Red Box – we are able to give our clients complete loyalty and relationship marketing solutions,” says Almeida. The three companies operate independently of each other and sometimes offer a complete package of solutions. For instance, Vodafone has often used Cartesian consultancy for its data consulting needs while others have realised the importance of data accumulation and availability.
Be it through credit card companies, improved Internet connectivity that boosts e-commerce or the advent of mobiles, India is accumulating data that helps direct marketers understand and analyse consumer behaviour. “This is crucial as you need to understand what the consumer needs and wants are before you start thinking about a loyalty programme. You need to be sure that the company will benefit through its programme,” says Almeida.

Canadian collaboration

Direxions’ collaboration with Loyalty One is an important step towards making a foray into international markets. It has found an able partner in Loyalty One to can make this happen. “We wanted a strategic partner, someone who shares our dreams and aspiration for growth. Post its success in Brazil, Loyalty One was eager to expand in India. And we wanted a partner whose strengths we could leverage to spread our business in south-east Asia,” says Almeida.
With its stake in Direxions, Loyalty One is a part-owner of the company and there is a sharing of knowledge, practices and the talent pool. “The loyalty market in India is only going to get more exciting and interesting. With Loyalty One, there is going to be a lot of activity as the players in banking, credit card, mutual funds, telecom and the broadband space will require innovative loyalty programmes which in turn, will play a big role in their marketing strategy,” he adds.
Direxions has already expanded its horizons by creating programmes for the healthcare industry. They have recently been hired for pharmaceutical major Novartis. “We have been the first movers in many categories. The healthcare segment is very challenging to work in as we have to manoeuvre our way through numerous governmental guidelines,” says a confident Almeida. With an attitude to work past any new challenges that might come its way, Direxions is set to make the most of its experiences on national and international turfs.