The days of passive consumerism are long gone. Today, customers are active participants in the brands they love – they can shape their favorite products and services, shape brand narratives, and even co-create new offerings. This power shift has given customers a sense of ownership and belonging, which can lead to increased loyalty and advocacy. Web3 is at the center of this shift and is poised to accelerate two-way customer loyalty relationships into the future.
In Web3, brands can leverage blockchain-based digital identities to interact directly with customers without intermediaries. This not only opens up a channel for deeper, personalized dialogues but also paves the way for more curated experiences that resonate with customers.
Gamifying Loyalty Programs
In a traditional loyalty program, customers earn points for every dollar they spend. These points can then be redeemed for rewards, such as discounts, free products, or experiences. However, traditional loyalty programs can be cumbersome and difficult to use. Customers often have to keep track of multiple loyalty cards, and they may be unable to redeem their points for the rewards they want.
Decentralized loyalty programs are different. They use blockchain technology to create a secure, transparent, and tamper-proof record of customer activity and participation. This means that customers can be confident about their points being safe and tied to their digital identity.
Consider Starbucks and Nike brands that have gamified traditional customer loyalty concepts by integrating decentralized digital identities into their loyalty programs with great success.
Starbucks approached the metaverse with a strategy that was both true to its brand identity and accessible to those unfamiliar with crypto concepts. Its Web3-powered loyalty program Odyssey rewards customers with digital points and collectibles redeemable against exclusive member-only benefits and experiences.
Nike's .SWOOSH platform harnesses the potential of Web3 domains to deliver a unique and immersive brand experience. Here Nike emperors consumers to compete for rewards in community challenges and co-create Nike virtual creations. With this level of gamification, customers are no longer just collecting rewards; they're becoming brand ambassadors. This type of loyalty is priceless.
Both Starbucks and Nike exemplify how brands understand the key to success is making customers feel valued, engaged, and loyal. After all, isn't that what every brand is ultimately striving for?
Learn From The Best
In traditional systems, validating customer interactions and ensuring rewards go to the intended individuals can be complex and unclear. For instance, when a brand wants to reward customers for participating in a contest or event, it's not always possible to verify if the individuals eligible for rewards are the ones benefiting. There's a risk of these rewards, like discount coupons, being passed on to friends or family members, diluting the impact of the loyalty program.
This is where Web3, and decentralized digital identities, offer a game-changing approach. These digital identities make it easier for brands to authenticate their customers, ensuring that rewards reach the rightful recipients. This gives brands more control over their loyalty programs and creates a direct, trust-driven relationship with customers, ultimately boosting their loyalty. For example, Unstoppable Domains (my employer) and the Boss Beauties community rewards those who support their digital collectibles with Badges.
However, before you strap in for the customer loyalty ride, it’s essential to understand that this interactive revolution doesn't adopt a one-size-fits-all approach. Brands need to take time to curate platforms that resonate with the users and offer genuine utility.
Brands should reward user engagement with digital collectibles or virtual points. These do not necessarily need to carry any monetary value, but they could act as one by offering some perks and rewards along the way.
It’s also crucial to avoid complex jargon that might confuse or deter your users. Take a cue from Reddit, which introduced its NFT-based "Collectible Avatars" without using the terms 'crypto' or 'NFT,' demonstrating that simplicity fosters adoption. The outcome? Reddit brought over 3 million non-crypto natives to Web3 almost overnight.
A well-planned Web3 strategy can help brands stand out, and boost customer engagement and brand awareness. But above all else, don't let your brand fall behind; opportunities are endless in Web3, and while what works for some won’t work for others, experimentation and adaptation is the key to success.
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July 07, 2023 at 11:53PM
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How Companies Like Starbucks And Nike Are Innovating With Web3 Customer Loyalty Programs - Forbes
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