Loyalty 2.0: How Brands can Tokenise Customer Attention and Data (Part 7)

Blockchain and Loyalty – 4

Loyalty Science Lab: “Web3 offers the organizational framework (DAO’s), the platform (Blockchain), the assets (NFTs), and rewards that are transparent and trusted by all (Cryptocurrencies and Tokens).”

Clickz: “Look at Starbucks rewards. I get stars (whatever those are) when I purchase coffee or snacks at Starbucks and then can use those stars to get bonus coffee and snacks. What else can I do with them? Nothing. Can they be taken away by Starbucks? Absolutely. What if instead of stars I received tokens? What if those tokens could be gifted to others, exchanged for other currency, or used to get exclusive Starbucks experiences? The token makes that possible. And if I collect enough tokens, I can financially profit from the rewards program as a customer (outside of just coffee), where I can resell or gift my rewards to others… Since forever, brands have delivered unique content experiences to customers in exchange for data. With Web3, now we can give our customers and prospects the ability to own and financially profit from owning this digital property. At present, I don’t think these types of programs are for all your customers. Instead, think of building superfans. Previously we needed to build large audiences on social platforms to get any kind of traction at all. Now, because of the token, small numbers can make a big brand impact.

Michal Bacia: “In the context of rewards and loyalty programs blockchain can be useful for the following reasons: Rewards, like loyalty points, can be issued to customers in a form of blockchain tokens. This increases customers’ trust because these tokens can’t be erased, canceled or expired by the issuer. Additionally, tokens can be exchanged and traded with other users. Rules of the loyalty program can be included in the blockchain code, so they are transparent and can be executed automatically. Rewards that are virtual in nature (digital — videos, access to websites; or financial — cashbacks, discounts) can be automatically redeemed by customers. They can, for example, exchange their loyalty points for a reward interacting directly with the blockchain automated ‘smart contract’… The most obvious implementation of the blockchain technology would be issuing loyalty points as blockchain tokens…Tokens can be traded between users (customers and other vendors) on third party exchanges. They don’t expire. The issuing company can’t ‘pull the plug’. When multiple vendors decide to use the same token, they don’t need a trusted party to keep the records. They are also able to use market price signals to calculate their share of costs and benefits of the program. Additionally, the redemption of the rewards can be automated and governed by the blockchain ‘smart contracts’ further increasing the trust in the program.””

CoinTelegraph: “A branded stablecoin is a price-stable digital asset issued and supported by specific — or groups of — brands, enterprises or institutions. Branded stablecoins, which can be embedded directly into consumer-facing applications, offer brands a novel way of connecting directly with customers and acquiring insights to regain market share from competitors. Because blockchain and cryptocurrency remain strange concepts to most consumers, it’s essential to have a seamless experience where users may not even realize blockchain technology is powering the system. Enabled by secure and transparent decentralized ledger technology, branded stablecoins provide marketing intelligence to brands on who their biggest fans are. At the same time, branded stablecoins incentivize and reward customers for their loyalty. Brands can store user purchasing histories on the blockchain and then apply associated savings to their purchases in the future. It’s akin to loyalty points but less complicated, more liquid and ultimately more useful. Other features could include removing the need for a credit card or even providing interest on branded stablecoin savings to incentivize customers to hold… One day, maybe not so far off, a customer will have a digital wallet filled with all their favourite brands, a global ecosystem opening up the floodgates for mass adoption.”

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.