Cryptocurrency has intrigued consumers for some time, but interest spiked over the past 24 months. According to Bloomberg, more than half of traders who held crypto at the end of 2021 bought in over the previous 12 months. It makes sense that many of these new owners are learning about the currency at the same time they are building a position in the market.
A research study commissioned by Visa and LRW during 2021 reported almost universal awareness of cryptocurrency (94% globally) among adults with discretion over their household finances. The study is titled “The Crypto Phenomenon: Consumer Attitudes & Usage” and among many riveting findings, it also found that the biggest drivers of owning and using cryptocurrency are to take part in the “financial way of the future” and to “build wealth.”
These forward-looking motivational factors driving the adoption of crypto also support another emerging trend, the desire for consumers to link their loyalty program earnings to cryptocurrency. Augeo, a global leader in enterprise engagement and loyalty platform technologies, is on top of this trend and announced in February 2022 the development of Heaps, a comprehensive cryptocurrency platform enabling cardholders, consumers, employees and members to exchange loyalty rewards for leading cryptocurrencies.
In collaboration with Prime Trust, a leading digital asset infrastructure provider, the Heaps platform allows people to exchange loyalty points and cash back rewards for cryptocurrency as well as purchase crypto with cash and through recurring deposits. The platform also features an enormous discount marketplace where consumers can shop with thousands of merchants to earn crypto-back rewards.
Though we have talked with many parties interested in connecting loyalty currency with crypto, Augeo is the first we have encountered introducing a comprehensive investing and earning platform to the market. In doing so, Augeo is effectively reimagining rewards programs for the digital future and empowering crypto as a new incentive for loyalty rewards.
In the company press release, Peter Schultze, Augeo Vice President, Crypto Loyalty stated,
“Rewards create a compelling entry point for consumers getting into cryptocurrency. Heaps makes it easy for users to buy Crypto with points or cash, store digital assets in a secure wallet, track portfolio performance, learn about Crypto investing, and even earn Crypto-back on their purchases at thousands of popular brands through the Heaps marketplace.”
We had the opportunity to interview Peter and share highlights from that conversation here:
Wise Marketer (WM): Can you share some background on Augeo as well as details of the plan to launch this new crypto / loyalty product?
Peter Schultze (Peter): Augeo has a 20 plus -year history as a global leader in loyalty and engagement technologies, serving hundreds of clients, including 65 of the top Fortune 500 companies. Heaps is planned to launch in July 2022 with announcements of partners and implementations going live as the summer progresses. The offering will have a U.S. focus at launch, but with Augeo clients ranging across more than 100 countries, we are already being asked about international expansion, and it is certainly on our roadmap.
WM: What sparked this idea to link cryptocurrency and loyalty program currency?
Peter: Augeo today facilitates millions in loyalty point redemptions each month. About a year ago we were approached by some of our largest clients interested in cryptocurrency as a reward, where cardholders, customers, members or employees with points could redeem for a fractional share of Bitcoin or other leading cryptocurrencies. We took a deep look at what existed in the market and concluded that there was a better, more loyalty-centric and education-focused approach to crypto. The intersection of surging growth and interest in crypto with the billions of points redeemed annually in loyalty programs is where the opportunity elevates.
WM: You mentioned that education plays a significant role in this product. How?
Peter: Part of what differentiates our approach with Heaps is that we are more than an exchange. We are creating an educational platform where points can serve as an easy initial entry point to learn about the world of crypto and digital assets. We’re helping users build a foundation through in-house content and engaging tutorials centered around understanding the basics of crypto, blockchain, and digital assets, as well as communicating the risks and benefits that may come along with participating, rather than advocating for crypto. The educational focused approached combined with multiple crypto-back earning mechanisms further differentiates the platform.
WM: What Cryptocurrencies will be included for exchange in this program?
PS: Most of the existing solutions we had seen were focused on Bitcoin only. Heaps will give users choice by offering 5-8 leading cryptocurrencies, including Bitcoin and Ethereum, among a handful of others that have been established in the marketplace.
WM: What is the role of Prime Trust in this program?
Peter: We partnered with Prime Trust, a leading crypto infrastructure provider and a licensed trust company, to provide our users a secure solution for buying, selling, and holding digital assets.
WM: Do you see the product as a “savings vehicle” for consumers or something else?
Peter: There is now a shared sense of inevitability to the adoption of crypto by consumers, so yes, there is a savings or investment aspect to this product. But first and foremost, we see this as an educational opportunity because it’s such an easy way to ‘dip your toe in the water’ and learn more about crypto and digital assets. The audience is very wide.
WM: Where do you expect to gain traction first for Heaps? Will it work better in one vertical market than another?
Peter: Financial institutions will be the early adopters. 86% of those who own crypto are interested in crypto rewards on their credit and debit cards, and we’re already seeing incredible traction from the existing crypto rewards cards in the market today with meaningful impact on card spend. We also believe crypto will become increasingly popular in the world of employee benefits and recognition. Crypto creates a unique recruiting and retention tool for a next-generation crypto-savvy workforce, especially with employee retention being a topic of concern for employers during the “great resignation.”
WM: What other trends support your belief about the potential for Heaps in financial services?
Peter: The Visa study you referenced showed that more than 80% of all groups surveyed (active owners, passive owners and the curious) express interest in crypto rewards. More than a third (39%) of current crypto owners indicate they plan to switch to a bank that offers crypto products within the next 12 months. Crypto-linked cards and rewards can become a low-friction gateway to engagement. Financial institutions may have the potential to acquire new customers and build loyalty both with consumers who are familiarizing with cryptocurrency for the first time, and also those who currently own crypto and are seeking new ways to acquire more.
WM: Where do you believe the connection exists between loyalty and cryptocurrency?
Peter: The rapidly growing adoption and interest in cryptocurrency has created new opportunities for organizations to drive deeper engagement both transactionally and experientially with their customers, employees, and members. Our thesis is that rewards create an easy entry point into cryptocurrency and digital assets for both consumers and organizations. It can serve as the initial foray and opportunity to learn about the world of Crypto. And the data confirms this with more than half of consumers being interested in entering the crypto ecosystem through rewards. More broadly speaking, we believe crypto and digital assets will continue to transform the way we exchange value, with crypto impacting our world of work and play, with NFTs creating new ways to create access and foster community, and all of this tying back to elevating relationships and fueling engagement.