Google Pay rewards program: choose a loyalty model that drives repeat wallet use

Google Pay is Google's digital wallet: people use it to pay in stores and online and, depending on the market, to send money to each other or pay bills. You are the product manager asked to define the strategy for a Google Pay loyalty program. Explain what the program should achieve and for whom, which kind of rewards it should offer and who pays for them, how you would roll it out, and how you would know it is working. ```hint Name the behavior before the reward Decide which user behavior the program has to change and who will fund the rewards before you choose between points, cashback or perks. Keep in mind that a user who pays with the wallet often earns their card's own rewards already. ``` ### Clarifying Questions - What should the program move first: adoption by people who have never paid with Google Pay, how often existing users pay, or the range of things they use it for (in-store, online, bills, transfers)? - Which market is this for: a card-based tap-to-pay market such as the US, or India, where Google Pay runs on UPI and competes with other UPI apps? - Is there a reward budget, and does Google Pay earn anything per transaction today? Can merchants or banks fund rewards? - Should the program have a Google Pay reward currency of its own, or can it build on the merchant loyalty cards users already carry? ### What a Strong Answer Covers - A clear objective for the program, tied to why users do not pay with Google Pay today and to how Google benefits when they do. - A chosen user segment, plus the merchant side if rewards are merchant-funded, with a reason for the choice. - Several distinct loyalty models compared on habit impact, cost, defensibility against Apple Pay and card rewards, and effort, ending in a recommendation and a phased rollout. - Reward economics: who funds the rewards and how the program avoids paying for transactions that would have happened anyway. - Success metrics with incrementality measurement and guardrails for cost, abuse and privacy. ### Follow-up Questions - Users already earn rewards from their cards. Why would someone switch to paying with Google Pay for a program that adds less than their card gives? - Halfway through the year, the cost per incremental transaction is far above plan. What do you cut first, and how do you keep the users the program brought in? - Rewards that can be spent only on Google products cost Google less. Would you limit redemption that way, and what could go wrong?