Payment Week Exclusive: Q&A With LevelUp’s Matt Kiernan

What is LevelUp?

Matt Kiernan: LevelUp is a solution for consumers to pay with their phones at local businesses, and for businesses to accept mobile payments and drive loyalty for consumers through the LevelUp platform. It’s more convenient than pulling out a credit card or cash - most of the research shows that consumers have their phone in hand when they are at the business. It saves consumers money, and businesses can save money on interchange fees. Transactions on LevelUp are a flat 2%. With LevelUp, businesses can create very targeted marketing campaigns. LevelUp also offers a white-label solution, branded with the specifications of the company using it.

What does LevelUp have planned?

Matt Kiernan: Most of the news coming out of LevelUp is related to the white-label side of things. We have several new partnerships launching in the coming months. For example, we just had our first franchise company, Dunn Bros Coffee, launch. It’s exciting to watch a corporate location pass this along to their individual franchise locations. White-label is also interesting because it ties into the API we built for LevelUp. By building this API, we’re essentially enabling third parties to incorporate LevelUp payments into whatever products or services they have. If they want to incorporate LevelUp loyalty and rewards into their app, they can use the LevelUp API. The idea being that you can even go beyond the standard mobile payment, if you want to incorporate verified reviews; you can require reviewers to log in to their LevelUp accounts to confirm that they’ve been there. The next step for us is to go out and promote our API to third party developers - it’s free to use, ask us for a key, and you can start connecting to LevelUp’s payment ecosystem.

What’s the feedback you’ve been getting from consumers and merchants and how have you aimed to solve the issue of adoption on both sides?

Matt Kiernan: Right now we have over 5,000 merchant partners and over a million consumer users. The double-sided network is super challenging. We need merchants in order for the consumers to come and we need consumers for the merchants to accept it. We say, “There’s a lot of value for both sides that LevelUp can bring to you.” The service provides immediate relief for the issues that they are having. I’ll be the first to admit that paying with a credit card isn’t that painful. For consumers, we want them to realize that there are additional benefits to paying with their phone. Our strategy has been to target the businesses first, build products that bring real value to their business, and through the white label strategy in particular, we’ve been able to generate consumer use that way. Businesses end up using it, and consumers follow. sweetgreen for example, has increased their mobile app’s transaction volume to 18% of sales.

Does LevelUp categorize itself as a loyalty program, or payments service?

Matt Kiernan: It can sometimes be a challenge to explain it to people up front. There was an “Aha!” moment for us when talking to merchant partners about one of the programs they were using; a lot of our partners had loyalty programs that required two steps. You had to identify if the customer was part of the loyalty program, and you had to record the transaction. With LevelUp you’re combining the two - falling into a somewhat unique space. So if people ask, “who are your competitors?” it’s a little trickier to describe.

There’s a lot of competition with mobile payments. Mobile wallets and the like have been criticized for creating a solution for a problem that doesn’t exist. Where does LevelUp fit in this space?

Matt Kiernan: The credit card works pretty well. It’s a real quick and easy way to pay. It’s not really a problem that needs solving. It’s more of, if there’s a business you’re already going to once, three times a week, you can be putting your money to better use. It’s almost an agreement between merchants and their customers that’s invisible to most consumers. Every time you pay with a credit card, you’re making these businesses incur a fee. If you pay with LevelUp, they pay fewer fees and pass the savings on to you. It’s not immediately obvious to people that this is something that is beneficial, especially over the long term. There are competitors of ours that are approaching it like they are trying to solve a consumer problem. I would say for us, we’re providing a better consumer experience while trying to solve a complex merchant problem. We’ve done a few tests and found that LevelUp payments are a few seconds faster than cash and credit cards, but at the end of the day, I would say that benefit is second to the rewards LevelUp provides on both the merchant and consumer side.

Matt Kiernan, Director of Marketing

Matt joined LevelUp in 2010 as Director of Marketing, leading efforts to drive awareness and adoption of LevelUp’s mobile payments and loyalty service. Prior to LevelUp, he worked at Mullen Advertising as an Account Supervisor, responsible for clients including Orbitz.com, LendingTree and the Department of Defense. Matt graduated from Bentley University and currently lives in Boston.