January 17, 2024
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The reward and loyalty point system is a marketing strategy designed to help customers make
recurring purchases. Simply put, this system works by motivating customers to purchase more
than once by offering them points for every purchase they make.
Continuing, digital currency is a form of currency that only exists and works electronically.
Bitcoin is a famous example of a digital currency, which is also known as cryptocurrency or
crypto coin.

The use of digital currency has increased globally over the last ten years. According to recent
statistics, there are over 425 million crypto users around the world. Given that, a large number of
businesses working internationally have started to accept digital currencies as a form of payment.
Moreover, the rise in digital currencies is due to more than one factor. It is said to be a means of
value and trust for the people. It has made buying and selling of products a lot easier, along with
making international transactions. Furthermore, the ability of a digital currency to have both
storage and use options has certainly added to its growth.

Interestingly, cryptocurrencies have a high potential to impact traditional banking. The most
important technique is to offer an alternative to the traditional banking system. It gradually stops
the need to use traditional banks by eliminating the third party, thus providing a cost-saving and
efficient way of funds transfer.

Furthermore, the use of digital currencies has led to possible changes in customer behaviour and
transaction processes. It allows transactions to be made in a secure and hassle-free method.
Therefore, customers have been shifting towards crypto coins for the transfer of payments,
especially for international transactions.

Making cross-border payments through cryptocurrencies has become a popular trend these days,
mainly in countries with the highest level of inflation, like Kenya, India, Nigeria, Vietnam, Nepal
etc. Meanwhile, the decentralized nature of digital currencies reduces the risk of fraud by
enhancing security.

The significant impact of digital currencies on traditional financial systems is also visible in the
introduction of CBDCs. The Central Bank Digital Currencies will not only provide banks with
direct control of the money supply but will also improve and change the overall monetary policy
concept.

Simultaneously, the creation of cryptocurrencies has led to the formation of DeFi platforms,
which enable a decentralized system for borrowing, lending, and trading. In this way, crypto
coins have put forth a base for the emergence of a whole new financial system.

The Current Landscape of Loyalty Programs

The reward and loyalty program is a great strategy to attract customers towards more purchases.
However, it also comes with major drawbacks and difficulties within the market.
Businesses all around the world are practising reward and loyalty programs, and sometimes, they
can happen to be similar to one another. There is a possibility of them having identical rewards
or purchase requirements. It could possibly lead to reduced sales amid a lack of interest by
customers.

In addition to that, finding loyal customers is not always an easy task. When customers make a
repeated purchase, it simply does not mean they are loyal to the product. It could easily mean
that they are enjoying the offers the company has provided them with.

Hence, it might be difficult to know whether or not a customer is loyal to the services.
However, an easy way to stand out is to reward customers for leaving a positive review or even
recommending the brand to a fellow friend. This can allow the company to make sure which
customers are loyal.

Some loyalty programs are brought down for their lack of flexibility in earning and redeeming
rewards. Customers may feel like the given reward does not align with their preferences. This
could result in a feeling of restriction by the customer.

Moving on, loyalty programs offer a limited range reach of redemption options. This includes
discounts on products or a buy one, get one free strategy. As much as these options are tempting,
they may not adjust to the needs and wants of a customer. Limited redemption offers may be the
cause of fewer sales in the near future.

To add more to it, centralized control over customers leads to a lack of input from the customer.
It could result in responsiveness to the feedback a customer provides and put a stop to their needs
and preferences.

Introduction of Crypto Coins in the Loyalty Program

Integrating cryptocurrency into a loyalty program can strengthen customer commitment and
flexibility. By offering crypto rewards, participants receive a digital asset which can be easily
traded for newfound purposes. This allows the participants to engage in Blockchain Ecosystems
and discover the potential of a new and emerging financial asset market.

Additionally, the ability to choose from a range of cryptocurrencies can allow customers to align
the rewards with their personal preferences. This level of flexibility can deepen the base of
customer trust and engagement within the market.

Everyone likes freedom of choice, and by offering this feature, crypto coins address all three
drawbacks of traditional loyalty programs, including the lack of flexibility, limited redemption
options, and centralized control over customers.

Blockchain Technology Addresses the Shortcomings of Traditional Systems

Blockchain Technology addresses several shortcomings of traditional reward and loyalty systems
through its built-in features. Below are some of the ways it reduces the risk of these issues.

● Blockchain tech enables automatic reward distribution in loyalty programs through smart
contracts. This simplifies the process, cuts administrative work, and gives customers
quick access to their rewards.
● Furthermore, customers can also exchange the crypto coin on any exchange with the coin
they choose, eliminating the limited redemption and centralized control issue of
traditional loyalty programs.

Advantages of Using Crypto Coins in Loyalty Programs

The use of Crypto Coins in Loyalty programs guarantees numerous advantages. Some of the
advantages and perks are added below.

1. Value Appreciation

Crypto loyalty programs provide lasting value as rewards, issued in digital assets, can appreciate
over time. Unlike fixed cashback, this dynamic allows customers to benefit from the growing
value of their rewards as cryptocurrencies gain wider acceptance. This feature adds an appealing
dimension to loyalty programs, motivating customers by letting them witness the increasing
value of their rewards.

2. Improved Security and Decentralization

Customers are allowed to trade tokens for rewards without compromising any of the data. Since
Blockchain is decentralized, the data resides in more than one location. This helps in maintaining
maximum security as the data cannot be visible to anyone else except the network itself.

3. Community Engagement

Crypto loyalty programs build a sense of community and engagement. They appeal to crypto
enthusiasts, offering opportunities for discussions extra rewards through referrals, and social
media activities. Users contribute to program growth, creating a vibrant community that boosts
customer loyalty and advocacy.

4. Flexibility

It comes as no surprise that there is an expiration date for the benefits, which is why customers
are most likely to exit the loyalty programs.
To reduce this issue, customers have now been granted a different persuasion method in the form
of cryptocurrencies. The reward programs are now allowed to operate identically to a cashback
program. Here, the cryptocurrency is stored in a digital wallet and can be restorable at any time.

5. Challenges and Considerations

So far, the only statements regarding integrating crypto coins into loyalty programs have been of
utmost importance. But it comes with certain risks and challenges as well.
Here are some of the problems that have been introduced due to the integration of crypto coins
within the rewards and loyalty program.

6. Volatility

Cryptocurrencies are primarily known for their Price Volatility. This generally means how much
or how little the price has moved. Hence, the more volatile an asset is, the riskier it proves to
make an investment. It can create uncertainty for the participants as well as the businesses in
regard to the loyalty programs.

7. Regulatory Issues

Regulatory issues aligned with crypto coins in loyalty programs are one of the main reasons that
many leading firms do not invest in crypto assets. There is unreliability regarding the
involvement and regulation of crypto coins in the loyalty programs.

8. User Adoption

There is a high possibility that the participants may lack the comprehension of cryptocurrencies
and how to be in charge of digital wallets. Getting users the necessary training that they need is
crucial for a better understanding, but it could result in more time needed.

Case Studies

Many businesses all around the world have implemented the idea of introducing crypto coins in
their loyalty programs. Some of the real-world examples are provided below:

● In July 2018, Singapore Airlines announced that their flyer program, known as Kris
Flyer, has now been transformed into Kris Pay. It was introduced as a miles-based digital
wallet that members could use to convert their miles into rewards in the form of coins!
● Moving on, Shake Shack, a renowned restaurant for burgers and fries, also discovered the
use of including crypto coins in their loyalty program. This method worked when
customers paid with the use of a cash app with the help of their debit cards. With every
purchase, customers would receive 15% cashback, but instead of dollars, it would be
given out in the form of Bitcoins.
● Furthermore, Venmo has also adopted a “Cash Back to Crypto” feature, which enables
monthly cashback rewards in digital currencies for its customers. The available
cryptocurrencies are BTC, ETH, BCH, and LTC. Customers have control over the
decision of storing or selling their rewarded crypto in the Venmo App.

The Future of Loyalty Programs with Crypto Coins

With the increasing appearance of crypto coins, it is most likely to drive major advancement and
growth in loyalty programs. Some of the observations regarding the potential changes have been
given below.

a. Global Accessibility

As mentioned earlier, crypto coins have now made the concept of cross-border transactions
easier for customers. Basically, this method applies to people who do not have access to the
traditional banking system. So, with the increased use of cryptocurrencies due to global
accessibility, it seems like more and more businesses will adopt them as a means of attracting
new customers and retaining existing ones by offering crypto-based reward systems.

b. Enhanced Security System

The security features added in the crypto coins and Blockchain could lead to a safer and
fraud-resistant environment for the loyalty programs. Participants from all around the world can
benefit from the perks of better data protection and reduced risks.

c. A Wide Spread of Reward Options

With the use of simple currency, there are not many options available for the customers to benefit
from the loyalty program. A lesser range of rewards is given to gain an advantage, and there is
not much diversity within the program.
However, the use of crypto coins in loyalty programs offers customers countless benefits. With
the help of crypto, users have many options to redeem their rewards for digital assets.

d. Gamification

Gamification is one of the emerging concepts in the next-generation loyalty programs.
Integrating gamification into crypto loyalty programs transforms user engagement. By
incorporating game-like features, such as rewards and challenges, it enhances participant loyalty.
This dynamic approach not only makes loyalty programs more entertaining but also sets a trend
for the future. The combination of crypto and gamification emerges as a powerful strategy,
shaping the way businesses build lasting connections with their customers.

e. Coalition Loyalty Programs

Growing in popularity, partnerships and coalition loyalty programs are also part of the emerging
facet of the rewards system. Here, payment integration enables users to accumulate and redeem
rewards across multiple establishments. For instance, a regular supermarket shopper earns points
for savings at affiliated eateries, lodging, or entertainment. Collaboration expands program reach,
accelerates customer reward accumulation, and creates cross-promotion opportunities for
businesses.

Rewards (REW) ICO Launch and Investor Opportunity

In a nutshell, the Loyalty and Reward program is used to attract customers towards frequent
purchases with the benefit of rewarding them with every purchase they make.
Due to repeated or boring rewards, customers would gradually lower their purchases, which
would impact both the business and the customer.

Taking that into account, the Loyalty program collaborated with crypto coins, which elevated
things for businesses and their customers. With the help of crypto coins, businesses were now
open to new opportunities and rewards for customers. This helped in gaining and building a
better foundation of trust for the customers.

However, introducing crypto coins to loyalty programs has its drawbacks, too. It is quite
uncertain to predict when the price can increase or decrease, which can directly impact
businesses and their customers. However, it is safe to say that the integration of crypto coins into
rewards and loyalty programs is the future.

It is important to note that unforeseeable challenges within the program will influence the path of
these changes. Businesses carefully need to negotiate these acts to create a better future for their
customers.

An Initial Coin Offering (ICO) is the industry’s equivalent of an Initial Public Offering (IPO). A
crypto project looking for a way to raise funds can launch an ICO. Given the above discussion,
there is a new crypto coin set to launch its ICO soon in the market, named Rewards (REW) Coin.
Here are some reasons investors should invest in Rewards (REW) coins during the ICO phase.

Potential for grabbing REW Coins at discounted Prices

ICOs are said to offer their coins at a lower price compared to their original market value. So, for
that reason, investors have the advantage of acquiring REW coins not only before the market
launch but also at a discounted price. A successful ICO investment can provide significant
profits to early investors.

However, it is important to note that lower prices only exist during the ICO phase. This is one of
the reasons why investors should only invest in an ICO phase of Rewards (REW) Coin.

Access to Full Features of Rewards (REW) Network

ICO participants and investors are more likely to gain access to REW Coin’s features and
advantages way before other investors. This can also give future investors a better outlook on the
proposition, and will be able to make an investment.

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