With consumers facing a myriad of options with everything from their daily cup of coffee to what pair of shoes to buy or summer break to book, it has become more challenging than ever for brands to retain and acquire new customers.
For decades, loyalty programs have proven a highly effective way of doing this. They improve customer satisfaction through perks and discounts which in turn promotes brand advocacy. This might be why there are a staggering 3.3 billion loyalty memberships in the US alone, according to a report by Accenture.
However, many loyalty programs are outdated with brands often focusing on a transactional relationship:
A customer purchases an item or uses a company's service
He/she is awarded points (often issued to a plastic card)
When reaching a certain threshold the customer can access discounts on future sales
But in truth the foundation of any well thought out loyalty program should be centred around deeper customer relationships. A brand must understand what makes the customer tick and develop a far closer (and knowledgeable) relationship with them.
Where Web3 can help
In September this year Starbucks unveiled Starbucks Odyssey, a new experience powered by Web3 technology that offers Starbucks Rewards members and employees non-fungible tokens (NFTs). These digital collectable assets will unlock access to new benefits and immersive coffee experiences, ranging from espresso martini-making classes to a Costa Rica coffee farm trip.
By integrating into the Starbucks Rewards ecosystem and grounding the experience in coffee, connection and community, we are entering the Web3 space differently than any other brand, while deepening our members’ connection to Starbucks.” said Brady Brewer, Starbucks EVP and chief marketing officer.
Our vision is to create a place where our digital community can come together over coffee, engage in immersive experiences, and celebrate the heritage and future of Starbucks.
Starbucks started using blockchain for coffee traceability back in 2019, gathering data that allows their customers to understand where the beans came from, where they were roasted and even get brewing tips from baristas. A step towards improving supply chain efficiency, increasing trust and confidence with customers, while also attracting younger sustainably-minded consumers who depend greater transparency from the brands they buy from.
While Starbucks claims its integration with its rewards program is a differentiator, many other companies are also exploring how a Web3 strategy can be the instigator in reinventing their loyalty program.
Rejuvenating your loyalty program with a Web3 lens, is an opportunity to provide a new way to connect with customers and better understand their needs. To help grow the customer base, increase revenue, and maximise brand loyalty through collaboration, new customer experiences, and shared ownership.
Do you have a Web3 strategy and has your brand explored how NFTs can be used to increase revenue and grow customer loyalty? Get in touch if you'd like to learn how.