Blockchain technology and non-fungible tokens (NFTs) are quickly gaining popularity among businesses for use in loyalty programs.
Blockchain technology offers a secure and decentralised way to store and manage data, ensuring that loyalty program rewards and points cannot be tampered with or fraudulent. NFTs, on the other hand, provide a unique and verifiable way to represent loyalty program rewards and incentives, making them more difficult to duplicate and enabling businesses to offer one-of-a-kind rewards to their customers.
Additionally, the use of NFTs can help increase customer engagement, as they can be collected and traded by loyal customers. Overall, the use of blockchain technology and NFTs could improve the security, uniqueness, and engagement of these programs.
They could also help retailers better manage customer relationships by providing a comprehensive and accurate view of their customers’ activities and interactions while not relying on another entity or company owning customer data.
Brand tokens are digital assets that are issued by companies and can be used as a medium of exchange within a company’s ecosystem. For example, a company could issue brand tokens that can be earned by customers through various actions, such as making purchases or participating in promotions. These tokens can then be redeemed for rewards or used to access exclusive content or experiences.
Here are five ways retailers can use NFTs within their loyalty programs:
Limited edition products
These are one-of-a-kind NFTs for exclusive products that can only be acquired by loyal customers who have earned a certain number of tokens. This can create a sense of prestige for the retailer’s most dedicated customers, and incentivise them to continue engaging with the retailer and earning more tokens.
Collectible trading cards
Retailers can create NFTs that represent collectible trading cards, each featuring a rare design or character from the retailer’s brand. L’Oreal has partnered with the blockchain platform KnownOrigin to create a series of limited edition NFTs that represent collectible makeup products, such as lipsticks and eyeshadows.
Customers can collect and trade these NFTs, adding value and scarcity to the retailer’s loyalty program, and creating a fun and engaging experience for customers.
Virtual experiences
NFTs that unlock virtual experiences, such as virtual concerts, art installations, or live events. Customers can redeem their tokens for access to these virtual experiences, which can provide a unique and engaging way for customers to engage with the retailer’s brand.
AirAsia is using NFTs to create a loyalty program which rewards customers with collectible assets. The company has created a series of NFTs that represent virtual experiences, such as virtual concerts and art installations, which customers can redeem their tokens for. This enables the company to offer memorable rewards for its most dedicated customers.
Exclusive discounts and offers
These NFTs are for exclusive discounts and offers, such as a discount code or a free product with a minimum purchase. Customers can redeem their tokens for these offers, which can provide a valuable incentive for customers to continue engaging with the retailer.
Starbucks recently launched a digital rewards program based on the Ethereum blockchain, which allows customers to earn and redeem rewards using a digital token called the Starbucks Reward Token. Customers can earn tokens by making purchases, engaging with Starbucks’ social media channels, or providing feedback on products and services. They can then redeem their tokens for discounts, free products, or other perks.
Personalised gifts and rewards
Retailers could also create NFTs that represent personalised gifts and rewards, such as a customised product or a personalised message. Customers can redeem their tokens for these gifts and rewards, which can provide a personalised and memorable experience for customers, and show the retailer’s appreciation for their loyalty.
