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By Chinwendu Obienyi
Lai Labode is the founder and Managing Director of CashToken Rewards Africa, Africa’s first Cash Reward service company. He is also a principal partner at SaltinGStein limited, a technology and business consulting firm.
In an interview with selected journalists, Labode speaks on the business environment climate, CashToken Rewards Africa as a business, impact on society and the incentives the incoming administration needs to put in place for RewardTechs to thrive and contribute its quota to the development of the economy.
He also spoke on the company’s expansion and the company’s effort on having dual listing on the Nigerian Exchange Limited (NGX) and the New York Stock Exchange (NYSE).
Excerpts:
How it all started
Several years ago, we conducted a research called “patronage optimization research” and essentially we wanted to be able to understand what the most potent emotional dispensation is of any consumer that will trigger increased patronage of any good or service.
We were also looking for solutions that will potentially help Africa to redistribute wealth and get people out of poverty, help businesses thrive and impact the society. So, we established a model called “Socially Smart Business Model” which will help businesses become socially smart. What does it mean for a business to be socially smart? This is the successful marriage of Enterprise and Social development and of course what we found in our research is that as long as people are making purchases, they expect to get good service and products and they also expect to be rewarded. So we were looking for a type of reward that will make them increase patronage, help businesses grow and pay tax and our research led us to something quite interesting. We found that consumers are interested in cash Rewards. We also found out that they are not just interested in cash rewards, but they are interested in potentially life changing cash rewards. Hence, this meant that we had to create a product that would meet the expectations of consumers and also help businesses understand what consumers really want in exchange for loyalty.
We became the first to create Africa’s first Universal Cash Reward as a Service Company. We created the Universal Reward wallet meaning that consumers in Nigeria and across Africa will have a cash reward wallet that will work for every business. We had to establish a product that would help us execute the Cash reward as a service and the “CashToken” was born. The CashToken is an electronic reward commodity that offers the consumers of our partners, life changing cash opportunities. The CashToken is pretty unique and before you can receive it, an individual needs to patronise or meet a business objective. Every time you get a CashToken, it comes as an SMS telling you that MTN, Airtel or any other business has gifted you CashToken(s) depending on the set threshold.
Simultaneously you get an SMS informing you of your receipt of N6 Guaranteed Cash and a ticket into a weekly National Consumer Draw which happens every Friday. This draw is what offers consumers a chance to win between N5,000 and N100 million. There isn’t a company that impacts people in Africa the way we have consistently been doing it. There is a new era of hyper-consumer centricity that we are also leading while enabling businesses to optimize their customer loyalty investment. By implication, there is no time where a CashToken is given out to a consumer and it has not encouraged patronage, that has not happened.
Future of Consumer Rewards
The future of consumer rewards is the universal gamification of sales and patronage. We are entering the “consumer takes it all “era which means that every time a consumer buys, there is a reward not just in cash but a chance to potentially change their lives and that is the kind of product we have built. We are also very excited that we are seeing governments that have come forward to partner with us. For instance, Lagos state became the first government in the whole of Africa to establish a universal rewards for its residents. It is called “Eko Token”. We partnered with the government on that, and we are happy they are making much progress. Hyper-Consumer Centricity has already begun in Lagos state, and we are excited at the number of persons it has impacted. We are beginning to churn out some indexes right now and we will rank businesses based on profitability and social development.
Exploring the industry despite its size
The size is huge and we are starting to explore it. We are currently in partnership with Mastercard and helped them establish a Sub-Saharan Africa platform for all master cards holders in Africa. We have aggregated other merchants in Africa that offer CashToken Rewards. Our pilot phase includes Nigeria, Ghana, Ivory Coast, Kenya, Tanzania, Uganda and Zambia which is ongoing as we speak and of course, that expansion will continue to grow across Africa. When we talk about wealth redistribution in Africa, we are pulling people out of poverty because the impact is not based on charity but impact on the objective of businesses. We know that the growing population of young people is quite young and this is why we are using these businesses to impact them and grow their businesses.
Navigating COVID-19 and lessons learnt from it
COVID-19 simultaneously exposed challenges and opportunities. One of the key things about cash reward as a service is that there has never been a time when purchases stopped. People continued to buy and as people were buying, they got the guaranteed cash and they were getting opportunities to Win big. But beyond the opportunities, we are very conscious of the fact that we impact peoples’ lives.
It is also important to note that the money is not from CashToken Rewards Africa but from businesses who are our clients who want to reward loyal customers. The impact of COVID-19 is still there today. When we partnered with the Lagos state government, they wanted to see what they could do to help its citizens, better the state economy, build a tripod relationship with people, businesses and government and develop unprecedented public emotional equity. The ripple effect of what we are doing or what we have been doing is massive and we are in such a position that whilst others see us as a competition, we see them as co-opetition which is why part of what we do is help businesses optimize what they already have.
$100m capital commitment from Global Emerging Markets (GEM)
We are first of all excited by that commitment and $100 million is good money for an African business that is willing to expand and showcase what they have not just to Nigeria and Africa but to the world as well.
Our expansion path includes optimising what we have in Nigeria. While we have achieved some growth, we have not even begun to scratch the surface of our potential in addition to the huge market size available in Nigeria and across Africa. We will be spending a lot on marketing, improving our operations and preparing our business for the next level as regards technology. We will also be investing in people as we want to attract and retain the best talents across Africa.
We have also been able to profile countries who are profitable for expansion because I mean, this is a business. Part of what we found in this African innovation is that my team has been looking at how the developed countries (Australia and U.S.A) work to see how we can explore over there.In our robust plan which is already in motion, we have a path to about 9 countries with the $100 million and this includes the bridge between Africa and the rest of the world; the U.K. One of the key things for our access to the $100 million is the listing on the stock exchange and I will state that we are currently on the path to listing of CashToken Rewards Africa on the Nigerian Exchange Limited (NGX) and we are looking at listing on the New York Stock Exchange (NYSE) – dual listing, showcasing what Africa has for the world and ensuring we help businesses thrive.
Opportunities amid CBN’s cashless policy
A lot of things have changed from analogue to digital. We have an ongoing integration with the Central Bank of Nigeria (CBN) and what we have done or about doing is that we want to establish the largest financial and digital program for Africa so that every time a Nigerian makes a purchase digitally, he will receive a CashToken
What this means is that many more Nigerians will want to do digital transactions, and this will improve financial inclusion. It is important to state that we are not a lottery company but a cash reward service company.
Role of CBN, other regulators in support businesses like CashToken Rewards Africa
One of the beautiful things about eNaira is that one can get creative around it, and it gives an opportunity to do cheaper transactions and businesses can build their models around it as it is a level playing field for those who want to work with it. We feel that the partnership with them (CBN) is made in heaven. We have just kicked off a project with NIBSS.The private sector, NIBSS and CBN are on to something big.
Impact and future of CashToken Rewards Africa
We are a major part of the massive success of MTN and shortly, we will publish our indexes and in our publications, we will list the criteria that we used to measure businesses in Nigeria. We have impacted over 200 businesses through The CashToken Reward Program and that is just a start. Part of what we are seeing is a gravitation towards policy. We are looking at establishing National rewards as we think this is critical in Africa. This means that as long as purchase is made in any country in Africa and as the velocity of transactions increases, impact on the economies will increase. Our model is like the smartest capitalist way of redistributing wealth and in the next few years, we expect CashToken Rewards Africa as a RewardTech to surely be at the top and continue to make the most impact directly in homes. We want to make sure no Nigerian will go to bed without hope. As long as you make a purchase, you will receive a CashToken. The good news is that the CashToken Reward does not expire.
Fiscal incentives from the incoming administration to support businesses like CashToken Rewards Africa
We really hope that the best man wins, and I am happy with the way the Lagos state government has provided the ease of doing business in the state. We are expecting to see private public partnership that will have a massive impact on people at the Federal level. We want an enabling environment devoid of bureaucracy. We expect the incoming administration to establish policies that will help socially smart models like ours because ultimately people want to see dividends of democracy and its impact in their lives.
The focus should be on how we can redistribute wealth and pull people out of poverty.
