Why Chipotle and Spotify Turn To SheerID For Validating If You A Teacher Or Nurse

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This is a podcast episode titled, Why Chipotle and Spotify Turn To SheerID For Validating If You A Teacher Or Nurse. The summary for this episode is: In April, Chipotle announced their 4Heroes buy one, give one program to support healthcare heroes across the U.S.  But did you ever wonder how Chipotle and other companies are able to verify if the person on the receiving end is actually a healthcare professional?  Thanks to Jake Weatherly and the team at SheerID, you do not have to worry.  SheerID is the leader in identity marketing, allowing companies to instantly verify eligibility for consumer tribes like nurses, teachers, and college students.  I sat down with Jake to learn more about the inspiration for starting the company and why they believe consent-based marketing will be the future of engaging with consumers.

Jake Weatherly: Everybody who was ordering from Chipotle had the opportunity to nominate a frontline healthcare worker to get a free meal. And in about two hours, we processed over a 100,000 free burritos that went to nurses and doctors who are helping during this pandemic.

Dave Knox: I'm your host, Dave Knox. And this is Predicting the Turn, a show that helps business leaders meet their industry's inevitable disruption head- on. Welcome to another episode of Predicting the Turn. Today we sit down with Jake Weatherly, the co- founder of SheerID, as we talk about how the company has really accelerated their efforts in this world of COVID- 19. Jake, welcome to the show.

Jake Weatherly: Thanks, Dave. Great to be here. Really appreciate the opportunity.

Dave Knox: So I want to start with kind of the story behind the business and how it came to be. When and why did you find SheerID, and what exactly does the company do?

Jake Weatherly: Well, it's interesting. This was a very personal, I guess, kind of light bulb moment that sparked the journey that has become SheerID. I have a father- in- law who's a military veteran, and my wife is an elementary school teacher, and I started to see very similar experiences as they were being marketed to and recognized by brands as either a thank you for what you do in the community. Thank you for your service, with very specifically designed programs for military service members, for teachers. And then we started to look, my co- founder, David and I at the landscape more broadly. They're finding tons of programs out there that were specifically designed for college students, for corporate employees. And the list goes on and on. And these programs were full of friction and fraud simultaneously. And what I mean by that really came down to these individual experiences that my father- in- law and my wife shared with me. For example, in a military program where an organization is saying, " Thank you for your service. Here's a special price, or free entry to an event, or a VIP experience." The military service members would get really excited about that, but then it was time to prove eligibility. And what we were finding out there, and this was back in 2011, is that these organizations were asking military service members to either show up in person with highly sensitive personally identifiable information, like the DD 214, which is the form that the DOD issues, as you separate from military service. That includes things like your social security number, where you were stationed, all of your certifications, in some cases even blood type. And so it was just a really, really strange kind of last mile. And in some cases kind of an insulting last mile experience. Thank you for your service, now present super, super sensitive information to prove that you're eligible for this special military program. What I saw with my wife, especially in retail stores. As it was time to get the classroom ready during back to school is, discounts, special pricing and support for teachers as a thank you for what you do in the community. These programs are really strong and really common, but I watched her as I was standing alongside her in a retail store. I watched the cashier ask her for her pay stub to prove that she was a teacher in order to onboard. So tons and tons of friction, relying really heavily on in- person experiences. And then very, very difficult to onboard or prove eligibility in a digital world, without sending something and waiting in line and having agents look at things, again that are highly sensitive. But we also found that it was really easy to gain these programs, to basically claim that you're a student and show an old student ID. Or use a. edu email address that you keep, and therefore get through to something that really was specifically designed for currently enrolled college students. So, David and I took a step back and we said, " What if there was a software platform that was connected in real time to the authoritative data." So for a student, think about a connection to the actual enrollment database at the university or college. So that individual can raise her hand and say, " I want you to check this about me, because I'm excited about what's on the other side." Let's say half off a Spotify premium music streaming subscription, or free ticket to a PGA tour event for a military service member. And so we started to pursue these data relationships in 2011, 2012, while going to market with an eligibility verification platform that was real time, took the friction out of the equation for those who are eligible, but stopped all this fraud from occurring. And basically it worked on both sides, and we've grown the company with that kind of two- sided approach. Do what's right for the consumer, bring them to a brand with invited personalization, and keep the fraud out of the equation.

Dave Knox: I love that. It's kind of great story built on an entrepreneurial itch. So when you look at these brands that are doing these offers, what do you think leads them to limit offers to specific consumer groups? And how do you think that's different then maybe a typical segmentation campaign?

Jake Weatherly: That's a great question. So, the way that I looked at, and so many marketers have kind of explained their perspective to me and to us as a team. Is almost like a translation service from kind of the old school segmentation and psychographics and demographics, to really true personalization and groups that could be defined or talked about as a tribe, right? So think about the highly coveted 18 to 24- year- old market segment globally, right? These are the new customers. These are Gen Z, they're a little bit more difficult to engage and authenticity is really important. They don't look at one another and say, " Hey, we're all in the 18 to 24- year- old club." What we found is college students do associate with one another and recognize one another as a tribe. And so messaging, creating a program and inviting college students to participate in something that's truly exclusive to them, it really sparks the word of mouth. It sparks an opportunity to work with them on their terms. And then you have first party data, right? You have this individual who's raised her hand and said, " I'm a college student. I'm really excited about your offer that's exclusive to college students, and I'm inviting a relationship with the brand." And therefore the cultivation and the loyalty, and again, word of mouth and kind of exciting spread organically of these offers occurs among the tribe, rather than among more mathematical or slicing and dicing. So the same psychology holds true for other consumer tribes, military, teachers, right now super, super important for SheerID, and certainly the world and all of our customers, doctors and nurses on the front lines. When a brand in effect says, " We want to reward you for the particular work that you do, it resonates really powerfully with the members of the tribe."

Dave Knox: So you mentioned kind of the moment we're in right now. What's an example of a brand that has really been able to use SheerID to reach one of these specific audiences?

Jake Weatherly: Yeah, great question. So I mentioned Spotify earlier. In 2014 we launched with the Spotify team a 50% discount for Spotify streaming services exclusive to college students. And since then we've taken that global. I also mentioned nurses and doctors. Just a few weeks ago we were approached actually by the team at Chipotle. And they were preparing to give away burritos to nurses and doctors during Nurses Week. And so we worked with them really, really quickly and efficiently to basically build a pay it forward program for burrito day. And what that means is, everybody who was ordering from Chipotle had the opportunity to nominate a frontline healthcare worker to get a free meal. And in about two hours, we processed over a 100, 000 free burritos that went to nurses and doctors who are helping during this pandemic.

Dave Knox: Talent is a big part of Predicting the Turn. And as we talk about talent, I want to mention one of our sponsors, Hunt Club. Imagine the power of the best marketers in the world, helping you to find your next marketing leader. That's the power of Hunt Club. Hunt Club is a new category of talent company that powers the network of experts, connectors, and business leaders to help you find the best talent. Let's face it, recruiting hasn't changed with the times. Hunt Club is changing the recruiting game by leveraging technology and crowd source referrals to find you the best people possible for your company. Stop paying job boards that don't work, or recruiting firms that recycle the same active candidates. Partner with Hunt Club. So, you've talked a lot about the tribes and what you call identity marketing that allows these marketers to more easily target a specific type of customer. What do you think marketing that tribe? Why is that make it so much more effective and interesting than maybe the bland definitions of personalization?

Jake Weatherly: Sure, great question. I think Lowe's Home Improvement is a really good example of that. Lowe's has worked with us to stand up the military program. Their program is basically 10% off every purchase online, in store, via their app, over the telephone, truly omni- channel where they're inviting people to say, " I am serving or have served in the military." And they're saying, " Thank you for your service." And Lowe's has a long history of supporting the military. They were founded by a military veteran, and because of this combination of the do- it- yourselfer and a really great way to say thank you for your service, they went all in with a military program and they found that the military consumer as a unique segment within their customer base, is the most valuable customer. One of the things that I think is really interesting in how they did things. And I think authenticity is just so key in this world. Not only did they invite people to verify their service and then get special pricing. But they also at every store in their parking lot, they put in special signs at the front of the parking lot for veterans parking only. They've worked locally in all of their various markets to really authentically say, " We recognize the sacrifices that you've made. We thank you for keeping us safe." And Lowe's in a fully transparent and invited way recognizes that service, and that's appreciated.

Dave Knox: So in a way what you're doing is kind of consent- based marketing in a way, which is vitally important in this world of privacy and everything else we're going with. How do you talk to consumers about that consent- based and opting in versus maybe the old way that they had to prove themselves?

Jake Weatherly: Yeah, so there's no doubt in my mind that consent- based marketing is where digital marketing is headed. We recently commissioned a report from Forrester Consulting on the topic of personalization and privacy. Their top line finding, which also addresses your previous question is, well, personalization was the top strategic initiative for business to consumer marketers and commerce professionals. They're really struggling to collect and manage and act on data. So that's the bad news. The good news is that brands are now discovering that consumers are willing to provide information on who they are, and what they're interested in, if there's a clear reason to do so. If there's real compelling and measurable value in essence on the other side. So brands like Spotify are creating new relationships with millions of consumers who share their affiliation, in that case the student, or their occupation, their life stage in exchange for a personalized offer for their specific consumer group. And so I would say through this approach consumers have control over the personalized marketing experience and their data. In addition to building trust with the consumer, it also gives the marketer high quality data they can trust for future communications. As marketers we know that third- party data is notoriously inaccurate, compared to consumer generated data. And frankly, we're just one of a number of growing technology companies that are doing one form or another of consent- based marketing. Weigh in, Pureprofile, and Jebbit for example are all focusing on user supplied data. I read a story not too long ago in which Jebbit noted that just three data consumer survey could predict if someone would make a purchase. Jebbit's customers then have the ability to send coupons in this case to these potential customers, which obviously increases the odds that these prospects will make a purchase that they'll convert. So for all these reasons, I think we're headed toward a future where marketers rely more on consumer generated data because of accuracy, and because of that invited personalization, and less on what might be called surveillance marketing, right? Buying data, appending a record, crossing your fingers that there's some level of accuracy there. And then following somebody in the digital world until they convert.

Dave Knox: So in the examples you've used, you've had some people that have done ongoing offers, like a Spotify inaudible discount that goes on, and others they've done call it, one off or one time offers. What have you found works best in this consent- based marketing? Is it that more ongoing or is it the one off intro?

Jake Weatherly: So we definitely find that an evergreen program, right, a always on program is the best way to go. We also support our customers to do campaign- based marketing. A lot of times that's their pilot program, if you will. And then other times it comes down to the uniqueness of in essence the campaign or marketing calendar specific to a given tribe. So think about doubling down during Veterans Day weekend, 4th of July, and then some of the really detailed kind of nuanced calendar items that we've learned, like the anniversary of the formation of the Marines. These are times when these kinds of programs are top of mind. So great times to launch something that's evergreen. But also a really good time to come in with a campaign in order to see ROI and understand the value of some of these highly coveted market segments and tribes.

Dave Knox: Well, I think that's a really key point of those niche times. For that audience it's really meaningful. It's not just a generic date that anybody would think of. Do something around Veterans Day. We all think about that way, but that specific date is a really meaningful for that audience.

Jake Weatherly: Well, and these are times to celebrate that status and to recognize and honor folks, or understand that these are times. For example, like getting ready to go to college as a freshmen. Think about all of the things that you're doing from high school graduation, obviously pre- pandemic, under the assumption that campuses are going to open up and kids are going to move into dorms and apartments, all those purchases that you're making, all of that prep. That's not, let's celebrate your graduation and it's not, after you've moved in, right? It's all of that planning and preparation where if you can work with students and you can work with households during that time with really valuable and unique offers, you can create customers for life.

Dave Knox: So you work with a lot of different tribes and working with brands with a lot of different offers. What percentage are you seeing get denied when a person's trying to request an offer, but they don't necessarily qualify?

Jake Weatherly: Yeah, it's a really interesting question. I think, in some of these tribes, you can chalk it up to kind of little white lies, right? So many people have an old. edu email address, even though they're not enrolled. And when . edu is asked for, they'll put it in and, hey, give it a shot. So across all of our consumer tribes, roughly 35% of attempts are fraudulent. Based on the two brands we serve, we estimate the margin savings on preventing or eliminating this fraud is literally several billion of dollars each year. But that's only part of the solution. It's an important part, yes. But the bigger story is building relationships with new customers based on honoring their service or status in society. So we've brought tens of millions of consumers together with brands every year. And we expect that trend to continue to multiply.

Dave Knox: And is EDU the most common one that that kind of fraud is happening with?

Jake Weatherly: You know, it's interesting, it's sort of the wink and nod. Sometimes it's actually the person behind the cash register who doesn't want to confront the customer and question their eligibility. It's interesting how far people will go to get into a special program. So lots and lots of different ways that we see fraudsters, whether individual consumers, just kind of testing, is there a real verification process behind this program? Or more sophisticated fraud rents, where they're trying to get in and get stored value, or coupon codes that they can sell on some secondary market. Or free tickets to an event that they can then sell and charge for. I mean, it goes on and on and as these programs and these offers get more valuable, and as we work with higher profile brands, we definitely see the more sophisticated fraudsters come in and try and exploiter or find holes in the armor.

Dave Knox: So you mentioned throughout the interview that, you've had a lot of people do great programs for first responders and things of that nature. When you look at the year to come, how do you think marketers are thinking about their engagement in different groups and what do you expect to come in their minds and their efforts?

Jake Weatherly: It's a great question. So I think we will forever have the next generation of customers, right? People coming into in essence early adulthood. Opening their first bank account, leasing their first department, purchasing their first car, coming off of their parents' cell phone plan and moving to their own. And that's evergreen. But I also think that we have... The other end of the spectrum, if you look at it from an age point of view, where more and more people are retiring, disposable income, and a real spark to double down on their hobbies or their goals after career. And then everything in between. Transitioning from a college student to starting to develop your career. Transitioning from active duty military service to civilian life. All of these things are in essence life stages. And in some cases very specific moments that are triggers for new categories of purchase, increased disposable income, and then also pointing purchasing power into different categories and verticals based on specific needs.

Dave Knox: I love that. Well, it's been a pleasure learning a little bit more about SheerID and everything that you built and congrats on creating such a true utility and useful tool for marketers.

Jake Weatherly: Thanks so much, Dave. Real pleasure to speak with you. And again, really flattered to have the opportunity to evangelize what we're working on at SheerID, and how we can help not only the brands, but also individual people in a real way to raise their hand and get value.

Dave Knox: For sure. Well, thanks again. And we'll talk soon.

Jake Weatherly: Great, excellent. Thank you.

Dave Knox: Thanks so much for listening. If you liked the show, hit that rating and make sure to subscribe so you don't miss a single episode. And for more resources, head over to predictingtheturn. com.


In April, Chipotle announced their 4Heroes buy one, give one program to support healthcare heroes across the U.S.  But did you ever wonder how Chipotle and other companies are able to verify if the person on the receiving end is actually a healthcare professional?  Thanks to Jake Weatherly and the team at SheerID, you do not have to worry.  SheerID is the leader in identity marketing, allowing companies to instantly verify eligibility for consumer tribes like nurses, teachers, and college students.  I sat down with Jake to learn more about the inspiration for starting the company and why they believe consent-based marketing will be the future of engaging with consumers.