Travelex with Dave Wascha (Big Bets 7)
This is a newsletter about big bets, explored through conversations with the product leaders who worked on them. For this one, I chatted to Dave Wascha about bets at Travelex, where he was the Global Product and Technology Director between 2014 and 2016.
‘They hired me with the wide open remit of “please make us relevant again”,’ Dave tells me. ‘Because inertia was carrying this successful global business to its grave.’ He’s giving me the story of his time at Travelex, a 45-year old company that realised it had to take some big bets on digital products to survive.
Travelex was founded in 1970, with its first branch in Leicester Square, to help travellers exchange their local currency for their destination currency. It grew into a hugely profitable business with offices in 35 countries, and more than 4000 kiosks, stores, shops and ATMs around the world.
But the business peaked in the 90s, and then began a gradual decline as consumer behaviour patterns changed, the world moved online, and people started to spend with cards abroad instead of cash. Travelex failed to capture the next generation of customers, leaving them stuck with an ageing customer base who were starting to travel less, and eventually dying.
By 2014, the management were desperate to move into the tech era to be able to compete. They brought in Dave Wascha to start a team doing digital incubation of new products and services. He hired a bunch of smart people from outside the FX industry - designers, engineers, product managers - who became the first employees of Travelex not to wear suits.
Rather than staying in the core office, he chose to insulate his new team against the rest of the business - which was suspicious of these digital upstarts - by basing them in Travelex’s old FX trading floor in the basement. Like a scrappy start-up, they made desks out of whatever they could find, and connected the old trading LED ticker running around the walls to a Raspberry Pi to show build status (and jokes). The team grew quickly - from just him and Rakhi Rajani, the design lead - to more than 100 people. I ask if he already knew what he was building, but he says they just started hiring as fast as they could in parallel to coming up with ideas.
Finding a different office space wasn’t just a precaution, Dave explains. The culture clash was substantial. The rest of the business were worried that his team were reckless and moving too fast for a highly regulated industry. And some of them were afraid for their jobs: for example, Travelex had a £40m data centre in Peterborough, but his team were building their services on AWS. These tensions were so serious that at one point Dave’s desk was vandalised and his laptop destroyed by anonymous disgruntled employees.
Undeterred, the team kicked off one big bet around a travel money card, and then decided to build Travelex an app. There was a strong expectation from leadership that the app would be a quick way to order money for collection at the airport - essentially just an online version of their existing services.
But Dave went out and spoke to customers instead. And not just a few. Together with Rakhi, he conducted 90 hours of jobs to be done interviews. They wanted to understand how people thought about money and how they thought about travelling, so that they could cast a wide net to identify new opportunities. They very quickly learned that there was a lot of emotion, anxiety and stress in the act of travelling, which was further amplified by the money aspect of it. People were worried about being ripped off in foreign countries, and they were worried about fraud. A typical story was that of a family who would always pay by credit card if going out to dinner in the UK, but as soon as they got to France would choose to pay in cash, because it felt safer. People were overwhelmed by the mental arithmetic involved in understanding prices in foreign currency and felt vulnerable when they couldn’t communicate with others about money due to language barriers.
Following these interviews, the team made a meta job map documenting the stages of a holiday: planning, preparing, travelling, returning home. Then they created further maps which broke each stage down into its subsequent parts. They explored every avenue: could they help you come up with what to do with the leftover foreign currency you had at the end of a trip? Could they use your location and transaction data from spending on the Supercard to make a memento map of your holiday? Armed with all the possible opportunities, they surveyed their users to find out what were the most important jobs, and which ones were being most and least well satisfied at the moment.
It turned out that what the stakeholders wanted them to do - i.e. make it easier to order money to pick up at the airport - was the job that was actually already the most satisfied and the least important. On the other hand, planning and budgeting for a trip in a foreign currency stood out clearly as the most important and least satisfied need.
Their jobs map and survey were helpful in telling the stakeholders: I know you want this, but there really isn’t a big opportunity here. ‘It took them a long time to get on board with not just doing a vanilla currency app,’ Dave tells me. ‘But I wasn’t prepared to build something that was a very slightly better variation of something that people didn’t care about.’ He didn’t exactly succeed in getting them excited about his idea, but he did persuade them to get out of the way and let the team work on the biggest opportunity: planning a trip.
In 4 months Dave’s team built an app that asked you questions about where you were going and what you wanted to do, and returned how much money you were likely to need. Then, with a single button, you were able to purchase that amount of currency for collection at the airport. They had built an app that put their services online, but with a clever hook that solved an unmet need.
It also took advantage of a unique asset: they leveraged Travelex’s huge network of international branches and kiosks to get the input data on how much things cost in each country - from staying in a hostel, to having a fancy dinner for two - by asking employees around the world to record local prices.
‘We didn’t want it to look or feel like an app coming from a financial services company,’ Dave tells me. ‘We really invested in the design and invented new interaction mechanisms.’ For example, they observed in research that people would enter multiple different amounts into the currency calculator to work out how much they wanted in a different currency. So they created a slider which let people slide their thumb up and down to easily explore different levels. They even designed a feature that meant if you put the app in your left hand it would flip into a ‘left-hand mode’ with the buttons in an easier to reach position. Was that really necessary? ‘It was the reason we became app of the month in the app store,’ Dave smiles. There’s nothing like free marketing.
This leads me to ask if they did much to launch the app or advertise it to customers. Dave says they didn’t, but as soon as they released it, it got around virally. They got a lot of eyeballs on the app stores, thanks to being featured in various categories, and quickly becoming the top consumer app in the Apple App Store. And they did a bit of promotion on social media via travel influencers (something the rest of the company had never heard of, and didn’t realise was happening at the time).
It wasn’t just adoption that was a success - engagement went from twice a year on a normal FX app to every week, because people were using it to plan their dream trips, and decide how much to save up. In addition, the average basket size was materially higher than Travelex’s standard basket size - because, as it turned out, people usually didn’t budget enough for their trip. This actually went some way to explaining all the fear and stress around travel money that they’d heard up front in the interviews - most people failed to budget correctly and ran out of money before the end of the holiday!
Dave explains that the engagement point was key. ‘It’s very hard to stand out on a boring task that people do rarely. You need to build a relationship with the customer, so that when they finally have need of the service, you’re the obvious and easy choice. In the case of travel money, you have to start talking to them maybe a year before they make the trip to win that transaction.’ His advice for anyone in a commodity space is to look anywhere other than the status quo to make money: for example forward or backward in the chronology of the task.
I ask if the difficult stakeholders acknowledged what a smart move the team had made. ‘Of course - the numbers spoke for themselves,’ Dave said. Coming up with an innovative and commercially successful product was an awesome achievement within a conservative business that had started with a huge fear of doing anything digital.
The story doesn’t have a happy ending, though. Dave’s other bet, the travel money Supercard, was shut down by some of the more conservative factions in the business. After 26 months of cultural battles, he was exhausted and decided to leave Travelex. Despite the success of the app, the business remained stuck in the past - their north star metric was still revenue per square foot of stores - and they didn’t continue to invest in the app, leading to stagnating growth. The problems kept coming: the company then ran into a bunch of legal issues and trouble with regulators, in January 2020 their entire IT system was overtaken by ransomware, and they suffered like all other travel businesses when the pandemic hit.
Today the future of the business is uncertain. Dave’s bets weren’t enough to turn around the company’s failing fortunes, but he can still be proud of what he and his team achieved.
If you face cultural resistance within a traditional business, try to create a distance between them and your team taking a bet
Talk expansively to real users to work out where the important, unmet needs are. Focus on these to build a successful product, rather than just building what your stakeholders want you to
In a commodity space, engage your users on something other than the status quo to win their loyalty