Startup interview: Pete Howroyd, CEO and Founder, Swapi

Pete Howroyd talks to RTIH about how he is tackling the issue of unspent loyalty rewards with the launch of mobile app venture Swapi.

RTIH: Tell us about yourself

PH: I’ve worked for over 20 years in loyalty, marketing and CRM roles, both in the UK and Australia. 

The focus for me has always been to work with companies on strategies that improve ROI and customer engagement in loyalty, and developing advanced customer led and data driven cultures. 

I directed some well-known loyalty programmes during my time client side with businesses in retail, fashion, pharmacy, technology and luxury industries, including brands such as Harvey Nichols, Harrods, Myer (Australia) and Sigma Healthcare. 

In 2018, I founded The Loyalty People which isan exciting new global collective of loyalty and CRM experts, created to give clients access to a network of trusted associates for any loyalty project.

In 2020, I took another leap into the business world and founded the global loyalty app, Swapi.  

RTIH: What was the inspiration behind setting the company up?

PH: I moved out of London to the countryside just at the start of the Covid pandemic. It was devastating to see the impact of lockdown on many brands and businesses in the retail sector. 

Everyone was discussing ideas to support them and help them build back better and stronger, and I started thinking about the bigger picture for loyalty. 

I’ve always been puzzled by the £6 billion worth of hidden, unspent loyalty rewards that sit unused on UK cards. It’s an even bigger number globally, sitting at $360 billion. Was there an innovative way to unlock some of that tender for the retail economy? 

One of loyalty’s biggest problems is the fact that consumers don’t always want to spend their loyalty points. 

This is due mainly to the fact they belong to a number of schemes, redemption is not as frictionless as it could be, the level of value is ambiguous - or they simply don’t want the provided rewards. 

I started thinking about how to build something more relevant for consumers that gave them the impetus to spend their rewards.

I was actually out in the countryside walking my dog when the idea came to me: an app that allowed people to swap their points between brands. I went home and started writing the business plan that day. 

“I’ve always been puzzled by the £6 billion worth of hidden, unspent loyalty rewards that sit unused on UK cards. It’s an even bigger number globally, sitting at $360 billion. Was there an innovative way to unlock some of that tender for the retail economy?”

RTIH: What has been the industry reaction thus far?

PH: We’ve had an incredible response from people on all sides.

My first step was to road test the idea with some senior retail contacts and they could all see straight away that Swapi provided a simple, innovative solution to loyalty’s challenges, bringing benefit on all sides. 

Firstly, it’s good for consumers. The app allows people to consolidate all their cards and points in one ‘digital wallet’, handing them power to swap and spend their unwanted rewards with other preferred brands – as points, gift cards, offers or products. 

And it’s the only app to provide this swap without the need to buy and sell loyalty currencies, which reduces reward value. 

Secondly, Swapi works for brands. For the brands that customers are swapping from, it provides a positive message around points’ expiry, plus it drives quicker breakage. 

It also retains customers in the core loyalty programme, adding a cost-effective additional benefit to a brand’s loyalty scheme. 

For brands gaining new customers from the ‘swap’, Swapi helps boost customer acquisition and provides a new source of revenue coming into the business.  

It also supports brands without their own loyalty scheme, offering Swapi points through card-linked offers, which customers can redeem across the ecosystem. 

Finally, as well as unlocking new tender to be spent, Swapi is a route to meeting the challenge many businesses face of loyalty programme liability. 

In phase two of its development, it will also integrate with charities to allow people to swap their points for donations to their favourite causes.

RTIH: What has been your biggest challenge/setback?

PH: On a personal level, it has been understanding the investment world. I’ve come from a corporate background working in house or as a consultant, and I had no experience or exposure to the world of finance. 

I would say, however, that like most entrepreneurs, I’m attracted to the challenge and I’ve actually found this aspect of building the business really rewarding. 

I’ve learnt a huge amount in the past year, and we are also lucky to have attracted a brilliant team to bring the Swapi idea to market, which includes some very experienced leaders across loyalty, business and finance.  

“People have broken with many of their old habits due to lockdown, and the old loyalty rules don’t apply any more. There’s a new urgency to find ways to engage customer and build loyalty. I think Swapi can be a big part of that solution”

RTIH: What are the biggest challenges facing the omnichannel retail sector right now? 

PH: The pandemic has challenged retailers in an almost unimaginable way, and they are all having to plan and adapt very quickly to respond. 

From my point of view, the statistics around loyalty show that people have broken with many of their old habits due to lockdown, and the old loyalty rules don’t apply any more.

There’s a new urgency to find ways to engage customer and build loyalty. I think Swapi can be a big part of that solution. 

RTIH: What's the best question about your company or the market asked of you recently by an investor?

PH:  Why would businesses let customers swap their points? I understand why this might seem counterintuitive. 

However, giving customers the option to spend their rewards more freely is actually a positive benefit for brands and something that will increase loyalty amongst their customers in the long term.

RTIH: And a customer?

PH: What else can be swapped?

Again, this is a good question, and whilst we’re focused on building Swapi within the retail sector at the start, we will quickly follow this up with a second phase of development.

This includes adding functions to the app that allow for swaps to a very broad range of businesses and also charity donations. 

RTIH: What can we expect to see from you over the next 12 months?

PH: We already have a significant raise secured privately, and at the moment we’re pre-registering interest for a crowdfunding campaign on Crowdcube. 

We’re very excited to see this go live at the end of February and then the countdown will then be on to our full launch in the summer.