In this edition of Leaders in Customer Loyalty: Industry Voices, Loyalty360’s Ethan Perry spoke with Jim Sturm, President of North America at Capillary Technologies, about the company’s aggressive growth strategy, its differentiators in the crowded loyalty technology marketplace, and how artificial intelligence is reshaping loyalty programs for 2025 and beyond.
Expanding Capillary’s North American Footprint
Sturm has been a fixture in the loyalty industry for years, previously with Brierley Partners before joining Capillary. When he connected with Capillary’s co-founders, the company had set its sights on establishing a U.S. presence. “I was employee number one here in North America,” Sturm recalled. “Since then, we’ve been on a very aggressive growth plan. Today, about 65% of the company’s revenue comes from North America.”
Capillary’s expansion hasn’t been accidental. The company now employs roughly 200 people across the region, fueled by organic growth and strategic acquisitions. “Much of our progress has come through acquisitions, but it’s also a testament to the demand for loyalty innovation in this market,” Sturm said.
Recently elevated to President of North America, Sturm emphasized that the role is less about titles and more about focus. “What matters is ensuring we have a greater presence in North America—through analyst relationships, through partnerships, and most importantly through working with clients,” he explained. “The appointment really acknowledges how critical this market is, both to Capillary and to the loyalty industry globally.”
Trusted Advisors First, Technology Enablers Second
While many companies position themselves primarily as software providers, Capillary aims to be known as a partner that provides both strategic guidance and enabling technology.
“What we want clients to see in us is trusted advisors,” Sturm said. “Most brands already have some kind of loyalty or CRM initiative. Our role is to help them make those initiatives stronger—or launch something new—through strategic thought leadership. Then we bring in technology to enable those strategies at scale.”
This dual focus allows Capillary to support a wide range of industries. Whether brands come with established programs or early-stage concepts, Capillary’s goal is consistent: deliver incremental revenue, stronger engagement, and long-term customer loyalty.
Standing Out in a Crowded Marketplace
The MarTech and loyalty technology landscape has never been more crowded, and Sturm is clear on what sets Capillary apart:
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Flexible Data Architecture: “Our platform is built on a highly flexible foundation that supports multiple industries and geographies,” Sturm said. “That flexibility is a key differentiator.”
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Proven AI Capabilities: “We’ve had artificial intelligence embedded in the platform for over seven years. It’s not new for us—it’s something we’ve been refining for a long time. That AI layer makes programs work harder by bringing intelligence and best practices directly into the platform.”
These strengths allow Capillary to deliver a global solution across industries, something many competitors struggle to match.
Growth Through Acquisitions
Capillary’s acquisition strategy has played a significant role in its expansion. Over the past several years, the company has acquired Persuade, Brierley Partners, the digital assets of Tenerity, and most recently, Kognitiv.
“These firms all brought strategic thinking, customer relationships, and technology capabilities,” Sturm said. “They’ve added more of what we already do well, while establishing a stronger presence in North America. For a brand that doesn’t yet know Capillary, acquisitions provide immediate credibility and a trusted foothold.”
Industry-Wide Innovation
While loyalty has its roots in travel and hospitality, Sturm noted that virtually every sector now has a program in place. “There isn’t one industry doing it better than others,” he explained. “It’s more of a game of catch-up. What we do see is that newer programs are often built on more advanced technology, allowing them to leverage data and AI more effectively.”
Gamification, in particular, is evolving. “It’s not just scratch-offs or spin-to-win anymore,” Sturm said. “Gamification is about keeping customers engaged between purchases. That could be challenges, leaderboards, surveys, or preference updates. It’s about building ongoing engagement and keeping the relationship active.”
Personalization and Rewards in 2025
In Loyalty360’s recent State of Customer Loyalty Report, 58% of brands cited new reward options as a focus for 2025. Sturm believes the real number is even higher.
“Consumers today expect personalization in everything,” he said. “Rewards must be flexible and tailored. The purpose of a reward is to motivate specific behaviors, whether that’s making another purchase, visiting more often, or completing a survey. When rewards are personalized, they become a powerful differentiator between brands.”
AI: The New Standard in Loyalty
Artificial intelligence is no longer a futuristic concept; it is fundamentally changing loyalty program design and execution. Sturm described Capillary’s AI-driven features, such as Nudge, which analyzes customer data, identifies behaviors like churn, and instantly recommends campaigns.
“Traditionally, it took months for humans to analyze data and make recommendations,” he said. “Now AI can handle descriptive, diagnostic, predictive, and prescriptive analytics in real time. It can identify what’s working, what’s not, and prescribe solutions that can go live the same day.”
This speed and intelligence is transforming loyalty operations. “It’s not just eliminating manual processes,” Sturm added. “It’s enabling deeper insights and faster action that humans alone couldn’t achieve.”
Measuring ROI with Precision
For brands under pressure to demonstrate value, Capillary offers a Value Delivery Framework that combines transactional and emotional measures.
Key components include:
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Incrementality in visits and revenue
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Reward earning and redemption rates
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BALOR (proprietary measure of active vs. lapsing customers)
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Emotional loyalty gauges measuring sentiment and passion for the brand
“Transactional data tells you if people are buying more or at higher value,” Sturm said. “But without understanding emotional engagement, you can’t guarantee they’ll keep coming back. The best programs measure both.”
Looking Ahead: Customer Expectations in 2025
Consumers’ expectations continue to rise, and Sturm pointed to personalization and speed as the two critical factors.
“People are time-starved, and attention spans are near zero,” he said. “If I give you my hard-earned money, I expect value in return. That means quickly earning rewards and receiving something that feels personal to me.”
Capillary plans to continue investing heavily in its platform, with AI-led innovations at the forefront. Yet Sturm believes technology is only one side of the equation. “At the end of the day, consumers want to buy from human beings,” he said. “Frontline associates—whether in-store, on the phone, or online—remain critical. Always focus on the customer experience first, not just the structure of a loyalty initiative.”
Final Thoughts
Capillary Technologies has positioned itself as both a strategic advisor and a technology enabler, helping brands elevate their loyalty initiatives with data-driven insights, flexible platforms, and advanced AI. As personalization and speed become non-negotiable for consumers, Capillary continues to push forward with innovation while reminding brands that loyalty success always comes back to the human experience.