Kigo CEO, Peter Schultze, and Kigo president and co-founder Ben Straley teamed up to discuss consumer loyalty programs at the D2 Conference Retail Edition. Kigo is a blockchain technology company which helps its customers expand and enhance customer loyalty and employee engagement platforms.
Why Loyalty Programs?
Loyalty programs work, say Schultze and Straley. In fact, Starbucks announced that over half of all their orders come through loyalty programs and loyalty memberships. Additionally:
- Approximately $48 billion in rewards and miles are issued annually.
- There are 3.8 billion loyalty memberships—or about 11 loyalty memberships per person—in the United States.
- Each of us, on average, collects approximately $150 worth of reward points per year.
Unfortunately, there is a tremendous amount of untapped potential in loyalty programs, as $16 billion of points go unredeemed on an annual basis. Moreover, 85% of members of loyalty programs say they don’t hear back from brands once they’ve signed up for their loyalty programs.
Schultze and Straley say that blockchain technology can activate and open up loyalty programs in ways that are going to drive the kind of engagement and incremental lift that loyalty programs aim for. Blockchain and digital assets can make a loyalty program more open, because your customers can share those experiences with more people, while you can collaborate with more brands. Consumers can collect digital assets, they can share them, they can trade them, and they can join the community behind them. In effect, the digital asset becomes a new communication channel between your brand and the consumer. Moreover, in the blockchain world, you can actually extend or share that benefit with somebody you care about. And so what was at first a retention program becomes also a customer referral engine.
“The thing about digital assets is they’re almost the ideal delivery vehicle for these types of experiences because it allows brands to essentially distribute one of one unique digital assets that wrap high-value-offer content or experiences that customers can access and trade. It reduces the risk of fraud. In the case of issuing high value rewards, you don’t have the issue around somebody duplicating or replicating the reward because it’s verifiably one of one. And you can do all sorts of interesting things, whether it’s issuing access to a suite at a sporting event or allowing a thousand customers, and only a thousand customers, exclusive access to a product drop,” says Schultze.
To hear more about incorporating digital assets into your loyalty program, including real-life case studies, watch the session [here].