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Will Crypto Loyalty Programs Replace Traditional Loyalty Points?

Currencies / cryptocurrency Jul 07, 2022 - 08:22 PM GMT

By: Submissions

Currencies

Loyalty programs are an essential part of the successful marketing strategy of any business. They are a main source-hook for retention and penetrative engagement.  Lately, the crypto industry has widely been adopting these programs.

As with the growing popularity of digital assets, the common question here is:




Can Cryptocurrency replace loyalty points?

Today, many businesses have initiated crypto reward programs that offer rewards in digital currencies instead of specific rewards points.

What Are Loyalty Programs?

Loyalty programs are a part of an incentive program that encourages consumers to be engaged with the company to earn rewards. 

The more you spend exclusively on one brand, the more points you earn from these programs. These points are redeemable for items, upgrades, and valuable experiences.

Crypto loyalty programs  distribute rewards in the form of cryptocurrencies such as Bitcoin (BTC), Ether (ETH), altcoins, and other crypto tokens.

Quick fact

Sperry & Hutchinson introduced the first loyalty program - the S&H Green Stamp program, which began in 1896. The program allowed customers to receive green cards upon purchase from a participating retail store.

Advantages of Crypto Loyalty Programs:

Crypto loyalty programs provide  benefits not only for businesses but for customers too. Loyalty points programs and crypto loyalty programs may sound interchangeable, but they have a lot of differences.

For one, loyalty points  have a fixed value, but the price of reward tokens will vary according to the demand in the market. However, consumers and brands have started seeing Cryptocurrency as the future of loyalty programs.

Here are some top advantages of Crypto loyalty programs:

  • Crypto rewards can help users enter (and possibly invest) in the crypto market.
  • It helps limit a company’s financial liability in case of any data breach.
  • It works as a marketing opportunity for companies to engage more customers.

5 Best Crypto Loyalty Reward Programs In 2022

Today, several programs offer rewards in the form of cryptocurrencies. While some give you rewards for using credit or debit cards, others offer rewards on sign-ups or deposits.

In addition, many crypto exchanges have started introducing their own coin to make their rewarding system more accessible.

Here are 5 best crypto loyalty reward programs in 2022 

Crypto Cashback Rewards

Cashback rewards are loyalty programs where customers are offered percentage rewards whenever they make a purchase at a certain retailer. 

An example of this use case can be XBO, a crypto exchange that will be launching soon. As per information by the exchange, XBO may offer up to 2% cashback on crypto purchases. The amount of cash back is  based on the status of the user on the company’s  5-tier loyalty program.

Travel Rewards with Crypto

Travel rewards are common loyalty rewards offered by various companies. Some travel companies offer discounts based on the amount paid in cryptocurrencies, while others offer rewards points for travelling and purchasing other things.

For instance, Loyyal is an online rewards system for customers which uses cryptocurrencies and smart contracts to build and maintain loyalty ecosystems that are secure and private. The top businesses that use Loyyal include Emirates Airways, AccorHotels, and Dubai.

Crypto Staking

Rewards can also be obtained for staking digital assets and cryptocurrencies on crypto exchange platforms, such as Kraken or Nexo. However, several staking coins may require bond time.

NFTs Appreciation Reward

Non-fungible Tokens (NFTs) are digital assets and cannot be interchangeable with other items. NFT frequently represents digital file assets such as art collections  and collectibles. ORAI Robotics has begun using an NFT reward system.  Employees can monetize their NFT by bringing it back to an employer after a certain period.

Credit Card Rewards

While several industries have included Cryptocurrency as a reward, credit card companies are no exception.

In some cases, the credit card user can get digital assets as rewards or cashback that users can use to purchase goods and services.

Conclusion

The Crypto reward programs have captured a huge market in a short span of time. Blockchain technology has emerged as the best mechanism for receiving and redeeming rewards in digital assets.

The quick adoption of cryptocurrencies in reward programs has opened up more opportunities for people willing to invest in these digital assets. Thus, all forms of crypto loyalty programs (on the whole) are highly likely to take over conventional retention and engagement methods. 

By Andrew Sanchik

© 2022 Copyright Andrew Sanchik - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


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