By Kevin Ott, CTO and SVP Product Development at Formation
Today we’ve announced that Formation’s first patent was awarded to our Dynamic Offer Optimization platform. The patent covers all the core methods we've developed to provide gamified personal offers at scale using machine learning and automation.
Why is this kind of technology critical for the modern loyalty stack? B2C brands are facing a number of global challenges and opportunities - the inevitable cookieless future balanced with pent-up consumer demand in our post-pandemic world - and need ways to deepen customer engagement to drive brand loyalty. Offers are one way to drive that engagement, but it's nearly impossible to scalably send 10s of millions of relevant, individualized offers, let alone measure them and then optimize future offer campaigns.
Yet most brands are not yet able to achieve individualized offers at scale. This is because segmentation stops working at scale, and the real-time tracking of millions of users is incredibly complex. The siloed data that exists in current loyalty tech stacks doesn't have the integrations, or the machine learning that can unify customer data across all channels and sources, and then optimize those insights over time.
Formation’s patented platform is uniquely created to solve these challenges. It applies machine learning to offer assignment, personalization, and optimization and the automation of processes to construct, monitor, and analyze offers based on user interactions and other data. And as we celebrate our first patent, it’s a great time to reflect on how far our productization effort has come.
In 2019, Formation created, sent, and fulfilled over 2 billion dynamically optimized offers on behalf of our large enterprise customers— a major milestone on our journey to making digital offers more relevant and effective. But that was only the beginning of Formation’s evolution from a tech-enabled solution to a self-service offer optimization product for all consumer-facing brands. That’s because in 2019 we began a two-year journey to protect and productize the intellectual property that was at the heart of our offer optimization solutions for Starbucks and United Airlines.
The platform we’ve built, which is now patented, has a number of components:
These components of our platform were built with a few principles in mind:
This is only the beginning for Formation’s patented platform. In subsequent blog entries, our engineers and data scientists will dive deeper into some of the capabilities we touch on above, so stay tuned!