How NFTs will drive the new wave of consumer loyalty

Part of the resistance to cryptocurrencies and digital assets in general stems from their versatility. Every time I feel like I’m near rock bottom, someone calls me a new use case for cryptocurrency.

But recently, it was Dan Juric, Vice President of Strategic Services for Lisk Group, who came up with a few new releases of well-established use cases for digital assets. The Lacek Group is a loyalty marketing agency focused on increasing consumer engagement for Fortune 1,000 companies.

Digital assets such as NFTs and cryptocurrencies not only offer new opportunities for brands to reward loyal consumers, but hold the promise of building deeper relationships between businesses and their customers.

“It looks like we’re at one of those very interesting stages in our industry because this booming region of cryptocurrencies and metaverses is so perfect for what we’re doing,” Jurek said. “With so much technology in place, we can deliver personalized experiences based on what we know about customers.”

In the simplest example, Jurek says that some brands use cryptocurrencies as payment methods for their customers, or leverage digital assets to directly reward desired consumer behavior. Other companies are taking advantage of the same blockchain technology to provide traceability, transparency, and transaction security. Still others use NFTs for advertising and promotion.

Jurek said that with the development of new layers of digital assets and innovation of new applications, companies have the opportunity to go much further.

“We see using the metaverse and web 3.0 to hide promo codes, companies incentivizing people to watch and earn stuff in the metaverse — where I think there will be a lot of growth,” Jurek said. “In NFTs, we’re seeing a largely engulfed market, but it’s becoming the path of least resistance for companies to get involved in. NFTs are the way brands dip their toes in the water.

Jurek identified four trends that define how companies use digital assets to retain consumers.

NFT Auctions for a Reason

“I liken it to an art auction — people can bid on NFTs, and if you bid higher, you win the NFT,” Jurek said. “This has been happening for a while. The real question is what brands are going to do with it to make customers feel valued and stay first in their minds, which is why NFTs exist for a reason. It’s a badge of honour.

When a brand auctions off a set of NFTs to support a cause with the product, consumers can “wear” or display the NFT as if it were a “badge of honor,” Jurek said, meaning that others on social media or in the metaverse could see that The person supports or participates in a social, political or religious cause.

Flexibility Bonus

Jurek said NFTs, in particular, allow brands to be flexible with what they offer consumers.

For example, consider two different consumers of cosmetics, Mary and Amy. Mary spends $5,000 a year on cosmetics, while Amy spends $1,000.

“Knowing that, we can differentiate the value we provide to each of these NFT holders and leverage that in cross-selling and over-selling,” York said. “So if Amy buys certain types of moisturizer, we can provide her with original performances and experiences — perhaps an exclusive experience with a favorite makeup artist. Because she’s an NFT, she could be one of 50 people who could do that.”

Driving desired consumer behavior

“Really what brands are doing now is saying, ‘We want you to fill out this survey so we can understand you better, and in return we will give you NFT or cryptocurrency,’” Jurek said. Within 30 days, the NFT can be exchanged for x amount of product and additional opportunity to buy stuff. »

In other words, digital assets can act as a carrot to get people to do the things that brands want them to do.

Speaking of digital islands…

NFT Recovery Options

Brands can enable NFTs to redeem them for concert or meeting experiences, access to content, or access to products. But in the future, consumers will have many choices about how to dispose of their NFTs.

Although NFTs are not replaceable, they can still change hands like any other digital asset, and the secondary market for NFTs is still in its infancy. So let’s say Amy, from our cosmetics example, doesn’t really want her own experience with a makeup artist – she can put her NFT on the secondary market and trade it for crypto, cash, or another NFT that offers a similarly valuable experience.

“It will open up a world of different options for people,” said Yorick. “Let’s say I’m rewarded with a trip to Hawaii through the points program, but I don’t want to go to Hawaii. I can exchange it for you for your trip to Belize in a secondary market like Bakkt. We’ll see more peer-to-peer trading than in the past.”

What does this mean for financial advice

The proliferation of reward programs based on blockchain and digital assets has few implications for financial advisors. On the other hand, advisors should be prepared to advise on how to redeem the bonus, and should be comfortable discussing potential trades in a secondary NFT market. Consultants should also be willing to examine NFT auctions for a cause and compare them to other traditional bidding experiences.

On the other hand, the financial industry may want to adopt some behavioral stimulation techniques for the wider brand world to inculcate better financial behaviors in its customers. This can include offering “digital islands” for good savings, spending and investing and offering NFT rewards to loyal customers by giving them access to social experiences.

By embracing consumer rewards focused on digital assets, human advisors can find ways to keep pace with already approved behavioral engineering through digital investing apps like Robinhood and Betterment, and create richer, happier, and happier clients.

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