Rethinking loyalty programs with NFTs

Community building, digital vouchers, loyalty programs, Non-fungible tokens (NFT) have more than one trick up their sleeve to renew the customer experience. Based on the same principle as blockchain as a cryptocurrency, NFTs are increasingly being talked about in the art industry and now… in marketing. We especially think of Starbucksin the United States, which launched its Odyssey initiative and which consists of offering members the opportunity to purchase NFTs under the loyalty program Awards Starbucks.

It is estimated that customer retention is on average five times cheaper than acquisition. And in the digital age, this loyalty marketing technique is still very popular with brands and audiences. However, we must remain on the lookout for what inspires customers and especially the rewards that can satisfy them. However, this is where we ask ourselves: is there an opportunity for brands to seize? We can take inspiration from initiatives such as Starbucks to improve your loyalty program?

Start at the Beginning: How to Create a Loyalty Program from NFTs
Imagine an exclusive club created by a brand where the most loyal customers have access to exclusive benefits. Let’s imagine the same thing, but exchanging the club for the NFTs. Do you follow me? OK, let’s put it another way: let’s take the loyalty card and turn it into digital vouchers. We obtain a formula that integrates the NFTs. This means that NFTs can be associated with something other than digital artwork (which also sells for exorbitant prices), but also with collectibles, exclusive products or a membership.

For example, by associating NFTs with collectibles, a brand could create a digital wallet that provides its loyal customers with unique, brand-related rewards. Thus, we collect non-fungible tokens while consolidating our relationship with the brand. Do you always follow me? here we go Hugh Briandblockchain CTO at French digital transformation company Ekino, let’s take a concrete example: “It is possible to offer NFTs as a loyalty benefit. For example, one can imagine NFTs issued for each year of subscription, with exclusive benefits for holders of a complete collection for several years. It is therefore based on a scarcity effect for those interested and on a possibility of resale for the disinterested. In other words, everyone wins: Year-old customers who aren’t interested in the benefits can resell their NFTs to other customers, who, with a full collection and associated benefits, will become brand ambassadors. This is just one example among many: the NFT market is full of many projects.

Value creation: are NFTs allies?
We have to admit it: Marketing is taking up more and more space online. Despite this, nearly 6 in 10 consumers choose to shop online rather than in-store, according to market research firm GWI. In this context, it should be clear that “NFTs offer a whole new playing field for marketing digital”, if we trust the expert in data analysis, Mohamed Habib Tounsi. “Although [les NFT] are often seen as a mere speculation tool, these have significant value to a marketer. An NFT can be used to foster a sense of community among your users and support causes you care about.” This community issue is also central to the very concept of NFTs, which, thanks to the blockchain, are driven by increasingly dynamic consumer groups. It goes without saying that one of the most effective uses of NFTs for brands is learning how they work and focusing on loyalty, perception and engagement. A significant addition to the value of the brand image.

A new customer experience
More and more digital marketing and data analytics experts believe that companies should take an interest in NFT to, among other things, redesign their loyalty program. Technological innovation, such as NFTs, provides an opportunity for brands and companies to differentiate themselves while delivering a customer experience that is currently quite unique. With the rise of metaverse, there is every reason to believe that some customers will migrate to these web sectors. At the same time, there are more and more followers of alternative currencies, be they cryptocurrencies or NFTs. Are there opportunities to be seized in this brand new market (or playground) for brands? Only the future will tell.

NFTs in a nutshell

  • What are NFTs?The first NFTs were created in 2014, but became popular in 2017, thanks to the digital currency Ethereum. NFT means Non-fungible token or non-fungible token, in French. Unlike money, which can change depending on the currency, these tokens are not fungible. An NFT is therefore unique by definition. They are completely traceable to the owner, who can sell or transfer them.
  • Where are NFTs located? An NFT is a digital token stored on a blockchain. They work in a similar way to cryptocurrencies, except that they are mostly associated with works of art. Thus, NFTs are linked to files (digital visual arts, videos, etc.) or metadata.
  • What are NFTs for? For mere mortals, the purchase of NFTs makes it possible to support an artist. As a result, by owning NFTs, you acquire sole ownership of an original, digital work.

Source: Futura Sciences

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