Design for Lifetime Value like a Visa PMM
Let's talk about one of the most underrated metrics in product marketing: customer lifetime value. Most PMMs I know don't even track it, but we absolutely should. When you understand customer lifetime value, every trade-off a PMM needs to make becomes crystal clear. You could reposition the product around what truly retains customers, focus your go-to-market efforts on segments that deliver long-term value, and help shape the product roadmap around features high lifetime value customers actually use.
We're unpacking all of this today through a fascinating case study on how Visa built a lifecycle marketing practice completely from scratch, moving beyond one-time use to drive repeat engagement and increase customer value over time.
Joining me is Terry Setiz, one of the sharpest minds in the game. Terry has spent over 20 years building go-to-market engines for brands like Coca-Cola, HBO, Hasbro, and for the last 12 years at Visa. He's launched campaigns with NFL stars, built strategies for Game of Thrones, and founded Visa's in-house agency Ad Hoc.
Terry brings us a masterclass in turning CLV insights into actionable strategy. Consider this your guide to understanding how your customers' true long-term value can transform every strategic decision you make as a PMM.
The Scoop on Visa
Did you know Visa isn’t actually a credit card company? Crazy - but kind of obvious when you think about it! Terry clears up this common myth for us — Visa is actually a payment tech powerhouse! Knowing this was a game-changer for how they approached product launches. It’s all about building tech that makes payments seamless across the globe. Visa's mission aligns beautifully with lifecycle marketing and boosting customer value, proving they’re all about the journey, not just the transaction.
Crafting a Game-Changing Lifecycle Marketing Strategy
Visa embarked on a journey to transform its lifecycle marketing from zero to hero. And here’s the juicy bit: they embraced the e-commerce boom to make sure that Visa was the go-to for every online purchase. Visa Checkout emerged as a beacon of innovation, merging traditional payment methods with cutting-edge technology to capture repeat business and enhance customer engagement.
Breaking Down Silos for Go-To-Market Triumph
Gone were the days of the ‘one and done’ product launch approach. Terry’s team knew they needed something more collaborative for Visa Checkout to take off. They unified the marketing and IT teams, ensuring they worked hand-in-hand, addressing merchants’ needs while enticing consumers with ease-of-use. The result? Reduced cart abandonment rates, soaring awareness levels, and a fresh way of thinking.
Zeroing in on Market Strategy
Terry’s advice is gold: understand the market and lock in solid KPIs with top execs to keep everyone aligned. The strategy must meet today’s expectations while also laying the groundwork for future success—because it’s not just about immediate wins but long-term growth.
Injecting Creativity into Market Strategy
Creativity isn’t optional if you want to stand out. The ‘One Hand’ campaign showcased Visa Checkout’s convenience in fun, memorable ways—think NFL stars making touchdowns with one hand while checking out with the other. These stories stuck because they were relatable and spoke directly to the audience’s needs.
Messaging Critique: Modelo Beer
For this segment of the show, we take you through a thoughtful critique of Modelo Beer. Terry praises their authentic tagline 'Brewed for those with a fighting spirit' for genuinely resonating with working-class audiences who take pride in hard work. However, he warns against generic sponsorships and endless product extensions that could water down their strong brand identity. Terry suggests Modelo could tackle broader issues like young men's challenges or immigration—topics that align authentically with their audience whilst staying true to their established brand ethics.
Tips for Aspiring Product Marketers
So, to all you PMMs out there itching to refine your strategies, take Terry’s advice: see product launches as an ongoing journey. You’re not just checking a box; you’re setting in motion a long game. Think like a mad scientist: form hypotheses, experiment like there’s no tomorrow, and don’t be afraid to pivot when needed.
Terry’s dedication to authenticity and learning is incredibly inspiring. Whether seasoned or just stepping in, there are plenty of lessons to help you not just chase trends but create legacies. So, embrace this wisdom and make it your own. Experiment, strategize, and most importantly, stay curious. Let’s rewrite the playbook.
Terry’s Formula:
Customer Lifetime Value = (Average Purchase Value x Purchase Frequency x Customer Lifespan)
LINKS:
Modelo Beer: https://www.modelousa.com/
Connect with Terry:
LinkedIn:https://www.linkedin.com/in/terry-seitz-57aa654/
Connect with Elle:
LinkedIn:https://www.linkedin.com/in/elle3izabeth/
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[00:00:00] Elle: Terry, welcome to the show.
[00:00:01] Terry: Thank you so much. Well, retrospective of my career and life. It's a very colorful and, and arguably checkered path. So this is gonna be an amazing discussion and thank you for the journey thus far. 'cause it's been, it's been a lot of fun.
[00:00:14] Elle: Yes. I am so tempted to ditch the topic that we had today and just talk about your Masting days or maybe your experience in the Bolivian prison.
Maybe I need to do a spinoff series just to get to know all the interesting to your words, colorful.
[00:00:30] Terry: It's amazing how we come into the mar, how we come into the marketing discipline, like where we came from.
[00:00:35] Elle: Oh yeah. And how it's shaped what we have to offer. I love it. Okay, let's dive right in. I can't imagine anyone would not know this, but just to keep it crystal clear, let's bring our listeners up to speed.
Tell us about Visa and maybe which products or services your team was responsible for.
[00:00:53] Terry: Yeah, so, so first and foremost, and I didn't realize this until I interviewed with them 13 years ago, we're not a [00:01:00] credit card company. I know that sounds incredible and bizarre, but we're not. We are a payment technology company, which is a lot of words basically to say.
We're the, the rails, the digital rails by which transactions and payments happen despite us being on the front of every card. We are not a credit card. We don't set interest rates. We don't actually issue cards. We're the technology that facilitates those transactions. We do that in a four party model.
There's buyers and sellers, and subsequently, there's issuer banks and acquiring banks. And we sort of sit in the middle and we make sure that the payments and the transactions go through. That started in 1958 in Fresno, uh, where back then it was very pen check, right? You had to go down to the branch, et cetera.
So we, in some respects were, were the original FinTech and we'll get into, uh, the case study later. Uh, that gives rise to sort of the, the new version of that. But yeah, we were arguably the original FinTech, you know, 60, 65 years ago. Today [00:02:00] we have over 5 billion cards or credentials in the marketplace. We process about 316 billion transactions on an annual basis, which is worth an estimated $16 trillion.
We do so in over 160 different currencies, 200 countries, 150 million merchants. And about 15,000 banks. So just to talk about sort of the scale, but again, we're not a, we're not a credit card company. That's the scale of the, the payments ecosystem that we, we have power.
[00:02:33] Elle: Yeah. IN never even imagined that.
Yeah.
[00:02:36] Terry: Yeah. Like we were amazing. Incidentally, we started out being owned by Consortium of Banks. We, IP iPod in 2008. So we sort of broke off, which is why we are the visa today, not attached from an ownership, uh, structural standpoint to a particular bank. What my team did and does is a couple things. One is we, we own the digital products, the marketing of digital products.
At the time [00:03:00] of the case that we're gonna be talking about, it was largely around sort of security benefits and features, uh, attached to things like zero liability, which you don't pay for fraudulent transactions, should they occur, et cetera. The other remit of my team was brand, and so it was about driving brand equity.
We called it brand health among sec, different segments of the, the, the cardholder population.
[00:03:20] Elle: Right. Yeah, it's so, I feel silly because I never even imagined, I never even thought about, I should say, how Visa's not a credit card, but after you mention it on my credit card, it has like I bank is this showing me the credit card and they're the ones setting the credit rates.
And as you mentioned, I. So very interesting and helpful to understand Visa's role in that ecosystem. So for the first segment of our show, we are going to talk about Visa's case study around lifecycle marketing and increasing customer value over time. So tell us more about what was going on at Visa when you realized that [00:04:00] leaning into lifecycle marketing or the practice of lifecycle marketing needed to be maybe more strongly established.
[00:04:07] Terry: Yeah, great question. So going back to our foundations in Fresno in 58, we launched about a product every 20 years. So this is not something that we are cranking on or had been cranking on a continual basis. We launched a credit card and then we launched a debit card. And then internationally we launched, which now is somewhat ubiquitous in the us what we called contactless cards, right?
Where you just go to the terminal payment terminal and you just tap right? You just tap everything. We didn't at the time launch a great deal of products, but what was happening was there was a, a revolution taking place in the consumer markets about how and where people were buying stuff. This is gonna sound like, no kidding, captain obvious, but back in, you know, 20 15, 20 16, e-commerce was still somewhat nascent.
Estimates are, it was about a $28 billion business. Fast forward [00:05:00] to today, it's a $1.5 trillion business. But back then it was pretty new and PayPal had jumped on top of, uh, that rise in e-commerce and foreshadowing where the growth was coming. And they were the first ones to develop and deploy a digital wallet, which made, made all the sense in the world.
We had not, MasterCard had, not, American Express had not, so we woke up somewhat nine years late to the game. They had actually developed Digital Wallet back in 98. Or did you know the company was founded in 98 and so. We decided to go out and try and establish a beachhead on our own to capture e-commerce transactions.
Uh, again, we're not a credit card. We believe that anywhere and in any form that someone is trying to make a transaction, a payment, we should be there. We should power that transaction. That goes back to how we make money, the economics of how we make money. But it also goes back to, I think, why we exist as a company, which will come, we'll come [00:06:00] back to when we talk about lifecycle marketing.
Which is back in 58 in Fresno dha, the founder believed that if we could digitize transactions and payments that would open up opportunities for progress for individuals, for small businesses and for society writ large. And so Visa Checkout, which is our digital wallet, or at the time was our digital wallet, is a manifestation of why we exist.
It's the how to progress. It was within that context that we launched checkout visa checkout, which by the way was a precursor to the FinTech revolution that we all see, particularly here in the Bay Area, in terms of what's happening with Venmo and Apple Pay and chime and buy now, pay later. And the proliferation of the ways in which people pay digitally, um, really started in 98 with PayPal and then with US MasterCard, et cetera.
Amex in, you know, 2015 and 16.
[00:06:59] Elle: Got it. Okay. [00:07:00] So you are seeing this change in human behavior, and I love what you said about sticking to the mission of why do we exist as a company? And if there's transactions that are happening outside of where the physical card is present, you need to be there. So tell me more about maybe like, what was the task at hand then with a creation of, of Visa checkout?
[00:07:24] Terry: Yeah. Excellent. So, again, go back in time though it still exists a little bit in, in what we call guest checkout. Back then you had to punch out your 16 account number, your address, your CCV, uh, your expiration date. It was annoying. It was annoying checkout or digital wallet, right? Is this notion that like you've preloaded your credentials one time and then anywhere you transact across the internet.
So the Visa checkout platform exists, like it became two steps or one step. Um, as we think about the future, it's gonna be sort of fingerprints and eyeballs, right? And it's, it's gonna, you know, but back then it was, it was fairly cumbersome. [00:08:00] So our remit in launching visa checkout was threefold. First and foremost, it was signing deals with merchants.
Going back to our four party model, we only exist in sort of the middle, where there's a buyer and a seller, an issuer bank, and an acquiring bank. We facilitate those transactions, but first and foremost, we had to get merchants to accept and integrate the Visa checkout product.
[00:08:24] Elle: Yep. You can't go and transact if the merchant doesn't create the space to do it.
Yeah.
[00:08:29] Terry: Right. Yeah. If, if there's no, what we call acceptance, if it doesn't exist, then we can't drive, so then the second remit or a second charge for us. Was driving awareness and understanding of the product, and then ultimately enrollments among consumers, right? So if we think about the McKinsey funnel, that's sort of the top part of the funnel, assuming, right, we're talking about the funnel vertically versus horizontally and we, that's a whole other conversation.
And then once we had driven awareness and understanding and ultimately enrollments, and this is where you rightly point out, [00:09:00] we really needed to drive lifecycle or bottom funnel. What we call repeat usage and loyalty, right? The sustainability of a product post-launch. So those three charges were an incredibly set of new muscles at Visa that we had to flex, because at that time we, we sort of existed like many other brands, particularly big brands in this like Henry Ford, like one team does X, then they hand it off to Y and then it gets handed off to Z, right?
And, and then the, the car gets shipped or the product gets shipped and you declare victory and, and you move on to something else. This new approach to getting deals signed with merchants, right? So that's the B2B part of our our existence. And then the B2C part of driving awareness, understanding enrollments, and then ultimately repeat usage required us to rewire and rethink our total marketing function.
[00:09:53] Elle: Yeah, that sounds incredibly complex because you're seeing this change in behavior in your own customers and [00:10:00] in the marketplace, but now you have to do that change in behavior in your own organization. And so it sounds like you had a two-sided market with merchants and consumers. How did you manage that from an execution standpoint?
Like how did you rewire the org to support that?
[00:10:16] Terry: We created a startup within the walls of Visa knowing that we had that three charge. Remit in front of us, and it was due to solving a bunch of problems, uh, which is often the case, right? You sort of don't know where you're going until you somewhat get to a, a series of forks in the road.
The first challenge we had was signing merchant deals. The way that Visa has historically worked is and been incredibly successful, is we underwrite a bunch of deals, right? There's, there's dollars in the thought to get an issuer or a merchant to sign up with us for the products and specifically provide, but when we were pitching Visa checkout.
We weren't signing deals, we weren't signing deals from a quantity standpoint, from a quality standpoint, from a size [00:11:00] standpoint, and from a speed standpoint.
[00:11:02] Elle: Hmm. That must have been disappointing to have built this exciting new startup, right. During a time when there's a big shift in the world and deals aren't flowing the way you want them to.
[00:11:14] Terry: Yeah, and and what we found, and this is a, a lesson that we'll talk about later, was. We found that the reasons why we weren't signing deals was a, as much as we like to think that our children are all beautiful and smart and wonderful, there was a little bit of point of parody in what we were launching with.
Two is what we were finding was the sell in process was not only through the sales team, through the IT folks on the merchant side, which is the traditional case. We actually, because there was the B2C side had to sell in to the marketing departments at all of these different merchants at Nike, at Williams Sonoma, at uh, pizza Hut, dunking Donuts and Starbucks, and a whole slew of others.
And so that created an interesting [00:12:00] challenge for us, which is like you had multiple stakeholders that are different objectives on their end. How do we go sell in checkout a visa checkout to ensure that these deals are getting, are getting done at, at the speed and the size in which we, we needed to, and this was critically important because one of the things that we had struggled with at the outset was something called, you know, mitigating the cart abandonment.
Great. Which is. You and I go online, we're gonna go buy a pair of Nike, bear Jordan's, but we don't finish the transaction.
[00:12:30] Elle: Oh yeah. I am a repeat offender of cart abandonment. To this day,
[00:12:36] Terry: like globally, like 65, 70% of purchases are actually abandoned. And so for the IT folks on the merchant side of the sales equation, they were like, how are you mitigating, how is checkout going to mitigate this when theoretically you're asking me to integrate this platform into our checkout process?
So we had to figure out a way to develop better sales enabled and cases to go do that. And then [00:13:00] subsequently, it's like we had to use marketing dollars and the marketing team on the other side to say, we're gonna drive the upper level funnel to get more people into the checkout process. Just that when we're able to consolidate the steps, which is the benefit of Visa checkout, you'll see increased conversion, lower carda abandon rate, you know, average ticket size, et cetera, go up.
The second challenge that we had was, again, once we had driven those deals, we had to then drive the consumer part of this, which was awareness of understanding enrollments and then repeat usage, and did so through the creation of models and segments using our first party data. We're Visa, we sit on a ton.
Of data through something called VisaNet and then obviously our customer, our merchant data and built out go-to-market plans accordingly. I should say, just to take it one step back, the solution to challenge one EG, how are we signing the deals? Was we erased the lines between the different marketing teams and went to our [00:14:00] potential merchants as one, and that one was, here's a better set of sales enablement materials and cases.
Number two is we're gonna come to you. With more or less fully baked co-marketing plans. So here's the creative, here's the content, here's the media plan attached to the deal dollars that we were pitching them with, so that we were talking to their IT teams and marketing teams all at once. It was a, basically, we just need you to sign on the dotted line and make some approvals.
We will take care of the full end-to-end process. And our marketing teams served sort of both gods and decision makers at the same time,
[00:14:40] Elle: bringing the two-sided market together, the B2C and the B2B marketers to help reduce and lower that cart abandonment rate with Visa checkout. That's so cool. Okay. And then what did you do about the second challenge that you mentioned?
Did you have a solution for that?
[00:14:58] Terry: Well, yeah. So the second challenge [00:15:00] was, so first you get the deals done right? We gotta get those over the line. We get the acceptance, we get what we call the button, the visa checkout button on merchant's websites, and then it was like, how are we driving? How are we driving awareness and understanding enrollments and ultimately repeat usage.
That challenge of the repeat usage was really fundamentally important because we at the time were like, well, we're gonna declare victory. We've done all of this stuff. But it was like, but wait, wait, wait. You now have to prove out the sustainability of a product. And so we developed a series of models and segments using first party data.
[00:15:33] Elle: Yes. Okay. This was the visa net, the plethora of data that you were sitting on, plus the merchant data. Ooh, you're so lucky. It's so just a product marketer's dream to have that kind of data.
[00:15:44] Terry: It's interesting. Yes. We were lucky, but we had to be incredibly careful. Right. We're a heavily regulated industry, so the use of PII is is carefully sort of monitored and executed against.
But what we did have and what was so crucial to [00:16:00] that lower funnel repeat usage lifecycle part was, you know, we're able to identify where people purchased, where they are likely to purchase. Again, be it on that merchant website or cross-selling to a different website, ticket size, price sensitivity to what was purchased.
And then really, really, really important for us was what we called recency, which was you had made a purchase. If you didn't make a purchase within 90 days, you became cost prohibitive to retarget because it was as if you were a new customer or a new consumer again. So we had about 90 days to make sure that we had achieved what we would call escape velocity, which was you transacting five or six times over a defined set of time, and then we didn't have to.
Target you again, it became more of a habitual use. You were transacting. Right? And now it's important because again, we go back to launching this product for [00:17:00] Visa, you're often sort of paying merchants to put the button into your checkout experience. Then you're goofing trial through offers, and then you're somewhat goofing repeat usage through some offers.
Right. But that, that investment hit needed to be decreased. Right. We, we had to take down our CPAs. And what we were calling our CPUs, right? Our cost per usage, right? And then ensure that ultimately those levels of investment, and this goes back to the beginning, were all part of establishing a lifetime value or a customer value, right?
If we think about the sort of CR definitions, right, like the lifetime value is the, the value of a sale times the number of transactions. Over the lifespan of your relationship with that, with that customer, consumer, right? And then you drill it down into, okay, well the customer lifetime value is, you take that lifetime value and then you times it by your profit margin, and that's how valuable a particular customer is to you at the time.
So for us, it was like weaving that [00:18:00] measurement story and that investment story, both for us who are making the investments and then the merchants to say, Hey, the, the customer lifetime value is X for you, or Y from a lifetime value perspective. And that became a critical story point for us through the launch.
[00:18:15] Elle: I love that. And just for listeners, FYI heads up, I'm gonna make sure that that formula, Terry, that you just mentioned shows up in the show notes so that our listeners can go and snag it and use it in their marketing strategies. Okay. So wrap us up with what was the result of all of this goodness that you were doing with Visa checkout?
What kind of impacts to Visa did you see?
[00:18:41] Terry: Yeah, great question. So this two chapter story of going into a merchant to get deals signed and showing them sort of the end-to-end process, the lifetime value, and then how product to consumer marketing integrated into one another. We were able to capture about 50% of the, what we call the [00:19:00] TAPV, the total addressable payment volume.
Which is, again, as visa, we want to process every transaction where we can, and that's about understanding where the payment volume exists and then going and try and capture that.
[00:19:12] Elle: And that, that sounds really high to me. Do you consider that really high? 'cause it sounds, it sounds like a really good metric.
[00:19:19] Terry: Yeah, it was the number of merchants, not the addressable payment volume. We didn't capture, you know, 6 trillion in volume. Like we didn't process that. It was like we had signed deals where their potential volume on their websites. Or across our platforms totaled 50% of our, of our target. So that was a, that was a big deal.
As we then moved into sort of, okay, well, charge number two was enrollments. Over the course of the, the product's life, we generated 35 million enrollments, big investment, big expectations, 35 million enrollments. Like that was huge. And then the last one was. Repeat usage and loyalty, right? The notion of a lifecycle metric, and we drove a 23% repeat usage rate, which depending on where you're looking [00:20:00] is 23% a lot or a little.
We gave ourselves an incredibly high hurdle to overcome, which was you had to be an active user. You had to make two transactions over a rolling 12 months, and that became the proof of sustainability. It wasn't like you signed up once and we never saw you again, but we got to count you as an account. You know, it's, it's like, no, you needed to be active.
So reaching almost a a quarter repeat usage rate. Was important. And, and that goes to this notion of, you know, trying to mitigate the leaky buckets, you know, that we and every other product launch are faced with.
[00:20:32] Elle: Yeah. I appreciate the boundaries that you put on even how you're going to track KPIs and metrics for this entire endeavor, right?
Like, it's who you are as a marketer and a leader is that chasing truths, right? So you're not even gonna let data sway you, you're gonna make sure to put parameters around that data. Right. Like your, to your point about like. Finding truly active users versus just someone who just signs up once. It really speaks to how genuine [00:21:00] the success of Visa checkout was.
So really helpful. I just, I love this story overall because it's such a great example of how product marketers can move beyond messaging and actually influence growth strategy. And it sounds like you connected. Lifecycle marketing to real business outcomes. And your team proved to merchants that visa checkout was worth investing in long term.
And then you use that repeat usage as a signal for product viability, and then you built programs for consumers to help drive behavior. I don't even know, maybe I'm saying it like as and then as if they happened one after the other, but some of this happened. Concurrently in parallel. Is that more accurate to say?
Probably.
[00:21:48] Terry: Yeah, that's, that's exactly right. We're all imperfect, fallible human beings and marketers. And what we were, what was happening was in, in sort of like neo real time uncovering where we needed to go [00:22:00] to as a product marketing team and, and evolve ourselves according to where the challenges were and where the, the, the business opportunity and KPIs sat.
[00:22:09] Elle: Yep. Yep. I love this. It's the kind of work that directly impacts customer lifetime value. There's so much we can learn here, so I'm really excited to dig into this next part. Um, let's just zoom out for, for a bit and say I'm an inspired product marketer listening to this story, and I'm trying to build a lifecycle program or get serious about driving customer lifetime value.
Where do I start? What would step one be?
[00:22:36] Terry: Yeah, step one is. Understanding the market driving dynamics like where, where growth revenue, your next dollar is coming from and and will likely come from. And then really being honest and go is the company, is the product that we are attaching to those dynamics really well positioned to go do that.
Right? So for us, very simply going back to the beginning [00:23:00] and in full deference to somebody like PayPal, we all saw the rise of purchases offline, brick and mortar stores. To starting and, and forever moving online. Right? And so checkout and PayPal, et cetera. Now, you know, the Venmos of the world, apple Pay are now doing, but, but for us, it was like the market dynamics were, were changing.
And for as a, as a product marketer that was salivating to go, oh my gosh, there's a new space that we, that we have to go play in. The other thing that was a, a sort of a, a step one A was, okay, you understand the market driving dynamics. How do you then size it? Right? We talked about TAM before and for us.
Given our scale, we couldn't go market and do co-marketing and deals with the tens of thousands, now hundreds of thousands of merchants online. What we had to do was prove that we could get the top, try and get most of the top 40, because then you have scale, right? If you can get most. Uh, big merchants to take [00:24:00] visa checkout, everyone else will follow.
So we've very much prioritized those big guys versus what we would call sort of the long tail merchants. And then thirdly, and this goes back to your earlier, very good point, step one B or one C, is this notion of like, we really should be aligning on KPIs cross-functionally and up with the, the C-suite before we launch.
And I know again, captain obvious statement. But at first it was like, we now, you know, we need to go sign deals. Okay, well that was the sales team's job. Well, that wasn't really happening then. It was like, okay, well now we have to go drive enrollments, but now we have to then prove LTV and and usage. And we, this was a huge learning for us, that it was like, if we're gonna think about a five year plan for a product and a product launch, we should be thinking about this from the totality of a lifecycle, not just in tranches of deal, sign rollman and then, and then lifecycle, you know, repeat usage.
So those three things I call sort of the step one is like understanding the numbers, the North star and where you're going.
[00:24:57] Elle: Yeah. Yeah. I really appreciate how [00:25:00] you put a timeline to it too, so you're not just looking at the here and now. So like the, to your point, understanding the context of, of your market, but also looking to the future and how that market will continue to evolve.
It's so common, uh, certainly in tech, right, for companies to wanna jump in and be a me too. Uh, and it's tempting to do that. And to your point earlier on, product marketers kind of like salivating at the opportunity to create and build something, you know, sexy and new and exciting. But if you really wanna drive value, I.
Looking internally, look at, looking at who I am internally. But being true to who you are as an organization sounds like a good reminder, even though it is a captain obvious. Uh, I appreciate that. Okay, so step one, you kind of have this understanding today's kind of here and now market context, market dynamics and aligning on the KPIs.
What about step two? What happens after that?
[00:25:56] Terry: Yeah, it's, it's interesting, as you and I have been talking about this, we are [00:26:00] essentially talking steps as if we're writing a brief. Right. So if the first part of what we just talked about is the, call it the business challenge and opportunity. The second one is your customer or consumer segment part, right?
It's the, the audience, for lack of a better word. So step two is understand the barriers to why deals aren't getting done right. For us, it was multiple stakeholders who we hadn't accounted for. It was somewhat of a point of parody, set of benefits, and how do you, how do you break through those things? How did we as an organization.
Break what was the traditional sell in deal making process, which again was just largely underwriting deals. And that became sort of first and foremost because again, we're a B two, B2C model. You understand the barriers to getting deals done and then transitioning to the consumer side, what are the barriers for adoption?
You rightly pointed out, if there's no acceptance, if you can't get deals done, then it doesn't matter about enrollments. Right. But you know, for us it [00:27:00] was, and I think a lesson for product marketers is. You gotta really focus and be maniacal about prioritizing benefits. They're all not the same. They are all not gonna drive perception or behavior usage in the same ways and at the same rate for us, it was the ease and convenience of what checkout provided people versus something like.
Security. And that was important because ease and convenience delivered against the merchant need of, Hey, I have, I wanted to make sure that folks can pay on their phone, on their laptop, you know, in the browser across all different sort of platforms. How does checkout mitigate the friction that is inherent with those things?
And then lastly, again, once you got 'em in the door, how do we ensure that there's repeat usage and loyalty? The sustainability of the product? And how do we do so in a way that weans us off of constantly just paying for people to transact for us. So again, that goes back to hyper segmentation. [00:28:00] It goes back to sort of the flywheel of communications that balanced education with specific product features and specific merchants, in our case, like co-marketing and doing so with a timestamp of.
And across a bunch of different channels to go, when is it gonna be cross prohibitive to continue to do these things, et cetera. So as we think about the brief, we go, okay, the business challenge was X. Here's sort of the, the sites, and then I.
[00:28:29] Elle: Understanding. Yeah, those barriers. And you mentioned a very important aspect of it that's specifically related to lifecycle marketing and unlocking customer lifetime value with looking at what are the barriers to repeat usage.
And some product marketers I know are really good about tracking that and identifying it, but it's so hard as product marketers because we have. We are one of the type of marketers who we have so [00:29:00] mu we have so much on our plate, we wear so many different hats. And not only could it be difficult to get that kind of data, but sometimes we don't even have time to track that kind of metric.
But it's a good reminder to add that into if, if there is a product marketing dashboard out there to add that KPI to that so that you can start looking at, you know, what could be those barriers to. Repeat usage or, or loyalty. Okay. So we talked about step one and step two. How about step three?
[00:29:34] Terry: Step three is the go to market strategy and then the, the crafting and deployment of that, of that strategy.
So again, I talked about the recharge remit of you gotta get deals signed, right? We had, we had to get visa checkout accepted at merchants. So we collapsed the process and the team's remit, and we went into 50 or 60 different merchants and said. Here's the sales enablement case for the IT folks, and then here's the [00:30:00] marketing case for the marketing team.
And went in with sort of one unified two chapter story. So that was the first thing we did. This all coalesced, and it goes back to the product features and benefits around what we were calling the one hand campaign. Right? And it, it was the notion that. Visa checkout is so easy, it's so convenient, it's so intuitive to use.
You don't have to do the 16 numbers and the CCC V in your office, right? It literally is like you can check out on any merchant website with one hand, and so we dimensionalize that through some really interesting. Vignettes and stories. So we had a surfer in Tahiti, uh, make a Pizza Hut order surfing.
[00:30:43] Elle: How cool.
Like super creative. Super creative.
[00:30:46] Terry: Yeah. Just to dramatize how this done, we had a bunch of NFL players throwing, you know, hail Marys, you know, 60 yards. Catching and checking out at the same time.
[00:30:56] Elle: I think maybe, was that like in a commercial or something? It sounds [00:31:00] so familiar. I think I might have seen it.
[00:31:02] Terry: Yeah. See, it worked. Everyone who worked, um, we did, uh, we did a Super Bowl stunt where we set the Guinness Book of World Records for most one-handed catches in 60 seconds. It was 33 and it was, it was done by Odell Beckham and Drew Brees at the time, which then. It, it got, it went a little viral. Antonio Brown, who was a star wide receiver for the, the Steelers.
Did it like the, the, the next year because he wanted to break it. Right. 'cause why, you know, NFL players have egos and they wanted to best each other right. Better again. So we dimensionalized this notion of one hand and the, the ease, the convenience, the, the intuitive use through that campaign. And then we also developed 50 or 60 different co-marketing campaigns with the individual merchants that we had signed deals with.
And so it was like, how do you talk about the concept of one hand within the context of what they were selling and, and their websites? And it was often done with [00:32:00] offers, right? You're paying for folks to sort of first, uh, make a transaction and then subsequently if there to some of the usage stuff. But what we also were very cognizant of was filling the pipeline with people who were not going to a specific merchant to redeem an offer.
And that tracks back to this marketing notion of the 95 5 rule, which is that at any given point in time, 95% of your potential market is not in the market for your product or service. They just simply are 5%. Are we as a, as a function, do an amazing job converting them, tracking them, attributing them to different platforms, right?
But the reality is, outta your total addressable market, 95% aren't. Actively seeking you out. How do you cultivate prime the pump, get them ready for when they are, and that we believe and know has a correlation to ultimately lower cost per acquisition and cost [00:33:00] per use when they are more actively primed versus the proxy of like cold calling, right?
You don't want to cold call, you want, you want the warm leads. We just did it at scale and so we would go to market with brand, what we were calling brand education campaigns and then co-marketing campaigns with very specific merchants. We then took that after you got it, after you became an enrollee and developed these segments and these models in terms of the where, when, why, how to get somebody to repeat, transact, and did so with more education and brand messaging.
Fly wheeled with more specific co merchant and we were able to disseminate where you would likely transact next and then served you advertising and marketing and built us a whole CRM program to go do that.
[00:33:46] Elle: What I think was so special and unique about how you built your go-to market strategy is that you intentionally included elements that influence lifetime value.
[00:34:00] And I haven't seen, and maybe it's just be, maybe this is a B2B thing. I haven't spent a ton of time in B2C, but I haven't seen a ton of go-to-market strategies that include. So much of the creative campaign rollout. Of course, I've seen and been part of creative campaign rollouts before as a B2B product marketer, but just typically it's, it's an initiative and activity that happens after the go-to-market strategy.
But in the case for Visa checkout, it's so important to include some of that as the elements of all those vignettes that you mentioned were so critical. To the success of the product. Great. Okay. I wanna do a quick recap now. So you had, uh, step one of understanding the market dynamics and, um, aligning on the KPIs, and then you add step two of understanding those, the barriers and the challenges.
And then step three, the go-to-market strategy. Is there anything else to this story?
[00:34:58] Terry: Yeah, I wanna tie it back to the [00:35:00] beginning, Fresno 58, DH, why Visa exists as an organization. And you and I talked about this sort of offline, but this comes from the, uh, Simon Sinek School of why you exist as a company, why you exist as a, as an individual.
And Visa Checkout served as a great example of why we come to work and why the company exists, right? So we go back to the beginning, which is. Visa exists to digitize payments or the digitization of payments enables individuals, small businesses, governments, right? All our different stakeholders. Society writ large to progress, right?
We are about a rising tide lifts all boats. We don't pick winners or losers wherever you transact across whatever form factor. Like we wanna power that, yes, because we make money, but because there's. Progress inherent in that society benefits. And I know that's like a, a very sort of high order thing to try and chase, but [00:36:00] truth be told, that's why Visa was created all of those years ago.
Visa checkout was one element of that, which was we were moving from brick and mortar checks, knocking out information to e-commerce right? Way back when. And so we were the, you know, visa checkout was, was one of the first, uh, manifestations of that. So don't lose that. Because it gives you purpose as you come in every day as a product marketer to go, why am I doing this?
Why am I slogging 50, 60, 70 hour weeks? It's because you're your why quote unquote, to go back to Simon is tracked to the company's why. So it, it underpinned all of this. So it's a really lovely story of sort of why we exist.
[00:36:41] Elle: Yeah. Right. Being true to the mission of the organization. I like that reminder.
That's very helpful. Um, last question for you on the first segment, this case study segment of our show, what advice do you have for A PMM who is embarking [00:37:00] on the journey of building customer lifetime value?
[00:37:04] Terry: So the first is product launches don't end after the product is launched. Kept an obvious statement, but you need to prove out the sustainability and the viability to use.
Use your good words. Or that product will not survive. So first and foremost, realize that as we're thinking about a launch, the launch really isn't just about the launch, it's about a five year program, the defined time period by which we are proving out the viability of a product. So end-to-end through lifecycle is critically important as we think about planning, investment asks, and then go to market plans accordingly.
The second, which is tangential to that. Is this notion of the 95 5 rule, which is we all spend most of our time thinking about the disposed or the predisposed, that 5% of people who are in our market, but realize 95% are not actively looking for us. So how do you cultivate them, get them primed at the [00:38:00] pump and ready such that when they are, their conversion becomes faster and cheaper.
Certainly from a CPA and A and a CPU perspective. And then third, what you teed up at the beginning is part and parcel with all of this, noting time constraints, resource constraints, is trying to think of, of ourselves as scientists or mad scientists, right? And if we think about that search for truth, or we think about the scientific process, it's developing hypotheses, right?
In our case, it was like, why aren't deals being signed? Why aren't, why isn't there consumer adoption? Oh my God, now we need to prove out this, you know, the viability of this product over the long term. What are the hypotheses that give rise to those barriers? And then potential opportunities. Test them.
[00:38:41] Elle: Yes, test them. I wanna repeat that again.
[00:38:45] Terry: Test them. Test them. Test them. You know, try and validate them. Then communicate them out to the organization, to the sales team, to the IT department, to C-suite, and go, this is what we found. Here's how we think we can optimize. And then test again and refine [00:39:00] again.
Like we are forever as scientists searching for the truth and the truth isn't often. A destination. It's about optimization. So think like a mad scientist the next time you're doing a product launch.
[00:39:13] Elle: I love that. I'm gonna say it again. Think like a mad scientist. I think that is such a powerful mindset shift for pmms.
And I've heard other marketing leaders say that product marketing is part art and part science, but we really to your point, like we're not just launching. Products we are, we should be constantly experimenting, and I think that makes for some of the strongest pmms that I've ever met, they're the ones who aren't afraid to experiment.
They're constantly running feedback loops with customers and with the product team. They're searching for patterns in the data and they're pushing beyond that initial hypothesis to see what. Actually moves the needle. So that's really helpful. It's not, it's not really just about crafting a story. It's about uncovering the [00:40:00] truth that earns the right to be told in a story.
And that means forming smart hypotheses, stress testing them, um, and being humble enough to refine when the data surprises you. It's the craft.
[00:40:16] Terry: What an awesome summary. You, you, we should flip seats. You should, you wanna interview?
[00:40:21] Elle: I'm just paraphrasing what you've already told us. Much better.
[00:40:24] Terry: Much better.
[00:40:25] Elle: I love this.
So fun. Okay, so that's gonna wrap up with the first segment of our show. Um, and now it's time for the second segment, which is. Also very fun. Um, this is the messaging critique. This is the part where we as marketing experts get to analyze real world messaging. And the fun part is, Terry, you get to pick the company.
Um, but before you announce the company you chose, just wanna remind our listeners, in case this is the first episode that they're tuning into, we're gonna talk through one thing that Terry's loving about the messaging or the product, something that's working really [00:41:00] well. One thing that we wish that the PMM would've done differently with the messaging.
And then finally something that, uh, the marketing team or the PMM team can iterate on to take the messaging to the next level. Maybe it's a creative campaign or content that they can think about. Um, really this is all about learning and brainstorming and refining our craft, not looking for negativity.
Just a thoughtful, constructive critique. All right, so let's get into it. Terry, what company did you pick?
[00:41:29] Terry: So we're gonna move totally away from payments and we're gonna move to beer. So my, my case to discuss today is Modelo. So for listeners. Hopefully you've seen the news recently, if you follow it.
Modelo is the, is now the number one bestselling beer brand, uh, in the United States. It, it just outpaced.
[00:41:50] Elle: I actually did not know that. I mean, I'm not a huge beer drinker. I do like beer, but I didn't know that. Go Modelo.
[00:41:56] Terry: Go Modelo. Yeah. Um, who would've thought so? [00:42:00] I love the case and I love the case because they understand first and foremost.
Who their target audience is. And we all like to say that we do. These guys know it better than anybody else. They are maniacally focused and they're positioning as maniacally focused on what I would call the working guy. They are not the IPA target audience. They are not the, um, we're ubiquitous American Bud, bud Light, like we're for everyone.
They are not the, uh, the vest crowd. They are for the every working common person. They're not chasing attention. They're not trying to, and we'll get into this in a second. They're not trying to capture everybody. I.
[00:42:53] Elle: I love that. So when I go to their website and I enter their website, their homepage tagline [00:43:00] reads, brooded for those with a fighting spirit.
I love it too. It to me, it immediately invokes the emotion of pride, right? Like to your point, they're speaking to those who are the working class and they're proud of it. I don't wanna get into too much of, of the topic, so I'll stop there and I'll ask you like, what else? Like tell me more about what you're loving about that messaging for their product.
[00:43:22] Terry: Well, I think you nailed it with this notion of pride. Going back to the Simon Sinek thing for just a second, in terms of why a company exists, Modelo as a brand exists to celebrate those, making it on their own terms. And so for, for this target, it's working with your hands. I. It's like laboring. These guys are not sitting in ivory towers and offices.
They are outside infrastructure making, making the world go round. Right? They are. They are those folks. The other thing they do to talk about your point about pride, which I think is so wonderful, is [00:44:00] that they're not shy about leaning into the Mexican and immigrant heritage. Of the brand. Right? That's the fighting spirit, right?
So much of boxing, right. And the boxing lore and legends and champions come up through, uh, through Mexico and, and South America. So they lean into the positioning on that. They understand sort of the why they exist. And then in their go to market, they profile all of these like-minded people. Right. So if you think about day laborers or small business owners, folks that are bootstrapping their way through life that weren't born with a silver spoon, right?
Tattoo artists, they lead into car culture, right? It's this, this notion of defiance, and I'm gonna do this on my own
[00:44:47] Elle: and on my own terms. Yes, yes.
[00:44:49] Terry: It's reflected in the music, the protagonists, and the characters. The tone is that they're doing some sponsorship with UFC and and MMA, which is like super in line with with who their [00:45:00] target audience, you know, celebrates ultimately, and again, I think this is a huge, a huge lesson for all of us, particularly product marketing.
It's, they put out content that the audience customers see themselves in. They are not aspirational to the point of like, I don't understand who that person is. Right. It's the like I'm targeting a 70-year-old, even though I'm profiling like a 45-year-old. No, no, no. This is like relatable. Like you see yourself in the work and I think that that's just like magic.
[00:45:30] Elle: Yeah. It's so human and so genuine and authentic. I love that. Okay, so what's something that you wish the PMM would've considered us? They were putting together some of that storytelling.
[00:45:41] Terry: Well, I think they've done a fantastic job. Affirming the positioning, why they exist, and then understanding their, their target audience, flowing it through all the go to market.
There's some cautionary tales here, and the first thing is they are in danger of eroding some of that [00:46:00] authenticity with what I would call sort of proximity based sponsorship alignment. They're in the NFL, but they don't sponsor teams. They just talk about fans generically. I was just watching the US.
Men's national team play last night, like they're in soccer, but they're not formally part of it. And so you see these generic like fan messaging scarves and jerseys that aren't actual teams, right? And so you're like, no, no, you're gonna erode these authentic moments of community and identity, so stop there.
The second is, and I don't understand admittedly, the unit, the unit economics behind this, and it goes back to, in some respects, the LTV conversation we had. Right, but they've started the well tread, well, we're gonna do a bunch of line extensions outside of the traditional beer. Now they're into like spiked AUA Frescas into fruit flavored beers.
And you worry that yes, in the short term that you, the economics are gonna be favorable because they're expanding the number of people buying Modelo. But you wonder [00:47:00] if those ardent loyalists who are buying it at high levels of frequency at scale, sort of the 2080 rule. Are gonna start to ebb away because it's no longer gonna be a beer brand about them because they're trying to be about and for everyone.
So two cautionary tales that I wish product marketers would think differently about, again, as we think about lifetime value.
[00:47:23] Elle: Mm-hmm. Mm-hmm. That's a really great point. Okay. And last point, what would you do to take it to the next level if you were at the PMM? So
[00:47:31] Terry: two provocations. The first is. There is somewhat coming out of the election though this isn't coming outta election.
It's just sort of an insight coming outta the election is what's happening to young men across the country. There seems to be sort of a quote unquote crisis, right? Employment numbers, mental health issues, identity, et cetera. And so is there a way for Modelo to authentically support young men as they are going through this really?[00:48:00]
Turbulent set of life stages that
[00:48:02] Elle: seizes the cultural moment with their target audience. That their target audience is experiencing.
[00:48:07] Terry: Yeah. Far easier said than done for you and I to talk about and for a beer brand to talk about, but I think that there's a provocation in, in potentially threading that needle.
And then the subsequent provocation is we all see what's happening and reading about what's happening in DC in state capitals, what's happening all over the place. Is there a way to sort of. Lean into, uh, the immigration issue and supporting, definitely, sort of supporting that without getting burned.
Again, they're just provocations, but you could conceivably, and going back to the roots of the brand, go, it's not out of bounds to talk about these things, but know, know that you may be singed on the backend.
[00:48:51] Elle: It would be a fine line, but is it doing, doing justice to your target audience? I like it. And just being bold with it.
Ooh. I don't [00:49:00] know if we have any Modelo pmms who are listening or if Modelo even has pmms for that matter, right? It's just, maybe it's just a super creative agency that they use. Um, but shout out to any of those marketers who may be, who may be listening and committing to the authenticity and, hey, there's a good idea for you to explore here.
With this creative cultural moment here. So, Terry, before we go, I just have to have a gratitude moment and say thank you so much for your willingness to come on and dive so deep into such a great case study with Visa and share your knowledge and expertise with the product marketing community today.
[00:49:35] Terry: Oh gosh, thank you.
The, the thanks is mine. Thanks for the, the platform to tell my story.
[00:49:40] Elle: Yeah, of course. For me personally, um, it's amazing to see some marketing product marketing, uh, leaders like yourself who have personally inspired me. So I wanna make a space in my episode for you to talk through maybe some of those marketing leaders who have inspired you and [00:50:00] shaped who, who you are.
Um, this is an opportunity to give some shout outs, so let's hear 'em.
[00:50:06] Terry: I'm gonna talk about four. And what's interesting, so the four are Yin Rani, Lisa Rubinic, Wendy Gruenberg, Maureen Malari, these four brilliant minds. I had the good fortune to work with at Gray Worldwide, which is a, you know, huge advertising agency in New York many, many years ago.
They ran the Hasbro business and a couple of other businesses. But it struck me that these four folks. Happened to work on the same account, at the same agency at the same time, and I was sitting at their, uh, feet learning from them for a number of years. Why them? Brilliant business minds, brilliant advertising minds and equally brilliant relationship minds all at work at the same time, their sort of number one leadership principle in proper corporate speak is this notion of sort of independence [00:51:00] with accountability informally.
Lisa Rubinic said this to me a number of times, is I will always give you enough rope to hang yourself, which sounds overly dramatic, but if you, if you think about it, it's this notion of I'm gonna give you independence. There's rope there for support if you need it, but there's accountability at the end of the day, and that's how she lean on this business.
And that's how the four. Brilliant. Uh, female leaders ran that business. That business stayed at Gray for 30 years, which is an anomaly these days, 30 years. A lot of it under these four individuals who, who ran the business, I. So they were so wonderful. So, so 15 years on, I still take that leadership principle into how I manage my teams in terms of, you know, independence with accountability.
You know, I'll give you enough rope to hang yourself. They gave me the, the opportunity and space to develop as a marketer. I. And, and as a leader, and so I'm eternally grateful for them.
[00:51:58] Elle: That's amazing. [00:52:00] It's, and you got them all at the same time.
[00:52:02] Terry: All at the same time.
[00:52:04] Elle: Oh, wow. I'm sure they give you a huge advantage as just as you developed your leadership skills and, and you got so many great mentors.
I love it. Okay, so I promise this is the last question that I have for you. Where else can we access your expertise? Is it best to connect the on, on LinkedIn and please tell us what's next for you.
[00:52:22] Terry: Yeah, LinkedIn, definitely. I've been doing. A ton of writing, covering some of the topics we talked about today in terms of, you know, becoming a mad scientist.
Going back to basics, you know, the notion of why the attention economy. So LinkedIn is where you can find my musings. You know, what's next is I'm doing a lot of advisory work and looking for opportunities that deliver against my why.
[00:52:48] Elle: I love it. And you could honestly write a book on some of this lifecycle marketing, delivering long-term customer value.
So just gonna throw it out there. I think the Mad Scientist could be a [00:53:00] really good book title.
[00:53:01] Terry: Thank you. You'll get credit for that in the, yeah.
[00:53:04] Elle: And the acknowledgements. Yeah. Awesome. Well, again, thank you so much, Terry. This was a lot of fun. And thank you PMM listeners for coming on this adventure with us today.
I hope this episode leaves you with inspiration to take the next step in your own journey. I.
