The Future of Loyalty Programs: Crypto Cashback

The Future of Loyalty Programs: Crypto Cashback

It's a well-known fact that keeping an existing customer is far less expensive than acquiring a new one. In today's highly competitive environment, loyalty programs can be an effective strategy: Customers who participate in paid loyalty programs are 62% more likely to spend more money on a brand. But what if you added cryptocurrency cashback to the mix?

A strong inducement

Cashback programs are not new; they have been around since 1986. Discover Financial Services introduced a credit card with novel features, such as a cashback bonus on certain purchases, at the time.

To fast-forward to today, you'll notice that with the implementation of blockchain technology in today's business world, crypto cashback and crypto rewards have become the new trend. Brands can use it to connect with both new and existing customers by tapping into it.

Crypto rewards, also known as cashback, are incentives given to customers in the form of cryptocurrencies. It's no surprise that various companies have begun to create their own coin in order to provide a more appealing and accessible loyalty program. With one out of every ten people now investing in cryptocurrency, the hype is real.

Chanticleer Holdings, a fast-food corporation, is one company that is already implementing such a strategy. A customer who eats at one of the franchised locations receives Mobivity Merit, a type of cryptocurrency. These can be redeemed at various restaurant chains without fear of fraud.

TripCandy, an accommodation booking platform, on the other hand, has built its entire business problem around crypto cashback. Customers can earn Candy tokens every time they book a trip. This coin enables them to obtain additional discounts or even additional trips, transforming travel into a profitable investment.

Points or cryptocurrency rewards

Although various industries have begun to use cryptocurrency rewards, credit cards have taken the lead, with slightly different types of rewards. When they use a credit card, for example, they can receive digital currency as a reward or earn points or cashback, which they can later exchange for other benefits.

Some credit cards offer cryptocurrencies like bitcoin or Ethereum that can be used to buy fast food, art, electronics, or even cars. Additionally, many online stores and services, such as Shopify, Xbox, and Starbucks, have enabled this payment channel.

Customers can, however, take advantage of these benefits through a variety of platforms and programs. Customers who have received crypto rewards may have access to something resembling a virtual wallet in some cases. With companies and allies using the same cryptocurrency, these wallets provide benefits such as discounts on new purchases, prizes, or rewards. This is exactly the way of ATG.

Despite their differences, both crypto rewards and loyalty program points provide benefits. According to a recent study conducted by Dartmouth's Tuck School of Business, the University of Colorado's Leeds School of Business, Graduate School of Business, and the University of Pittsburgh's profile Katz School, crypto rewards and points incentivize customers to complete more purchases once a reward is in place, demonstrate a reward behaviour effect, and would help managers, evaluate loyalty initiatives and forecast future results better than if only one or the other component is present As a result, with the assistance of these programs, business owners may see an increase in sales.

Laying the groundwork for future business growth

A well-organized loyalty program can assist businesses in unimaginable ways. To begin, let us discuss how businesses will, to put it mildly, improve their brand reputation. A customer is more likely to return to the same airline with which they accumulated enough miles for a free trip. Customers who purchase a product or service and are rewarded for it feel appreciated and connected to the brand, which encourages them to continue purchasing.

The structure of the loyalty program enables businesses to track what their customers consume, when, in what quantity, and how frequently. This data is critical for understanding customer behaviour and developing personalized strategies for targeting and connecting with them.

In a market with limitless possibilities, how a company communicates and interacts with its customers can go a long way. 84% of customers say that being treated as a person rather than a number is very important in winning their business, emphasizing the importance of developing and maintaining customer relationships.

In short, loyalty programs with cryptocurrency rewards demonstrate how businesses can capitalize on market trends to offer more appealing incentives to their customers. Currently, 44% of Americans are interested in receiving digital currencies as a substitute for traditional cash-back reward programs.

Taking all of this into account, establishing a solid loyalty program, for example, through crypto rewards, is a successful customer engagement strategy. Everyone knows that businesses with higher levels of engagement have higher levels of customer satisfaction, which translates to higher sales.

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