A growing number of companies – not just those deep in the weeds of the technology and selling related services – are seeing blockchain technology as providing important benefits for retailers, brands, customers and loyalty programs.
Recently, Samuel Baroukh, Nestle France chief digital officer said in a Null TX blog that companies should embrace blockchain because it offers security, as well as a source of trackable, decentralized information that can be shared by authorized blockchain participants, rather than a single brand. This capability enables loyalty program participants to use loyalty “tokens” at more than a single merchant. This flexibility makes the loyalty rewards more valuable to the participants.
Baroukh is an advisor to Universal Reward Protocol, a blockchain-based protocol where retailers reward shoppers for sharing their behavioral data. Shoppers can be rewarded for a variety of behaviors, like store visits, not just purchases, a capability that could address some of the early abandonment issues that some programs face.
At the recent LoyaltyLive seminar in Chicago, Bill Hanifin, Chief Executive Officer for the Wise Marketer Group, told the audience that companies can no longer wait until a consumer is a customer to build a relationship. Customers today are making their decisions about the companies they will do business with much earlier in the process, researching companies and products prior to purchasing. So loyalty providers have very little time to win a customer’s loyalty – rewards need to come quickly or a customer will leave. About 40% quit within the first 90 days.
[dropshadowbox align="center" effect="lifted-both" width="70%" height="" background_color="#ffffff" border_width="1" border_color="#dddddd" ]Companies can no longer wait until a consumer is a customer to build a relationship.[/dropshadowbox]
Hanifin also discussed other opportunities for blockchain and loyalty in the article in The Wise Marketer.
Singapore Airlines’ KrisFlyer claims to be the first company to fully embrace blockchain into its loyalty program, using Kris Pay, a blockchain-based digital wallet developed in partnership with KPMG and Microsoft to convert miles into units of payment that can then be used at partner merchants, including beauty parlors, gas stations, the county’s LEGO store outlets and other participating retailers, as discussed in this article in The Wise Marketer.
Other LoyaltyLive blockchain and loyalty experts said that blockchains advantages of security, traceability and simplicity could help eliminate many of the inefficiencies of some of today’s loyalty programs.
Al Burgio, founder of DigitalBits, called blockchain a win-win for loyalty program providers and customers. “It eliminates the friction that exists with programs today. It can move things faster, eliminate friction, enhance liquidity and increase the perceived value of the programs. The old programs cost too much in terms of time and money. Those with the most open minds will win.”
Burgio also likened blockchain today like the internet and ecommerce at start of the century. While there were many early failures with companies trying to capitalize on the technology, those who continued to fail to embrace it fell behind – including some that failed completely, those who did so successfully.
Phil Britt is a reporter for The Wise Marketer.