Updated: Feb 14, 2020
On January 9, 2020, Simon Yu, CEO and Co-Founder of StormX discusses with TF Blockchain Seattle his entrepreneurial journey, going from making Korean Tacos from his apartment to building a bitcoin, crypto, and loyalty rewards startup in 2014. Simon discusses how commerce and merchant adoption can be driven by giving rewards and incentivizing users, and then speaks on overall UX and design in blockchain, how what is happening globally effects locally, and opportunities for brands.
The adoption of blockchain is expanding globally and simultaneously bettering the loyalty of customers. Loyalty programs are now a huge industry, worth over $360 billion, with over 16 trillion loyalty points getting issued per year amongst approximately 7.6 billion consumers. What is being emphasized is the massiveness and substantiality of the industry.
Loyalty programs are structured marketing strategies or incentives merchants use to encourage customers to continue shopping or using their services, hence rewarding the loyalty of such customers. Blockchain plays an essential role in this regard.
According to a few studies, Colloquy's study inclusive, an average American is enrolled in at least 18 loyalty programs. However, about half of these loyalty programs are inactive, while 30% of customers do not redeem a point ever.
Nonetheless, we can confidently say that the personalization of this offer is the future of loyalty programs, especially now that the margins for growth are still appreciably large. This translates to the need to establish a personal relationship, one which is an interface of direct communication with the customer. One of such is through social media platforms such as Facebook.
At the moment, attracting a customer to patronize a business for the first time is more expensive than retaining that customer for future business.
Consequently, this has resulted in competition amongst counterparts, as they all struggle to steal customers by introducing advantageous offers. One perfect example of this is Amazon’s Prime membership. Amazon Prime is a subscription package for the most trusted customers of Amazon. And this is one thing that guarantees the advantages and rewards of their members.
Amazon has introduced and implemented a few improvements since its establishment, all in a bid to satisfy and retain customers. And of course, this has resulted in increased sales. Over time, more and more people are enrolling in Amazon’s loyalty programs so they can enjoy the privileges of Amazon Prime too.
Blockchain has the potential of simplifying the administration of loyalty programs. All thanks to its real-time transparency and cost-saving features, which, of course, can be achieved even in the medium term.
For consumers that are shuffling between a few loyalty programs, blockchain may also help in the provision of instant r