Companies will have to work hard to earn customers by providing them with the tools, the insight, and the power to make their own educated decisions
Loyalty is the single most valuable quality a brand looks for in a consumer.
Unfortunately, many brands look for loyalty in all the wrong places. Marketing and advertising initiatives often revolve around words like “capturing” or “targeting” consumers—opposed to thinking hard about how to earn consumer loyalty and keep them coming back over the long term. But every massively successful company knows that attracting a customer isn’t the hard part. What’s difficult is ensuring the customers or users you do attract, stay, so that you’re not constantly replacing the ones that leave.
Customer loyalty is especially difficult to create in Southeast Asia. Across the region, 45% of customers have compared prices on their smartphones, which is much higher than the 35% figure for the same question globally. This indicates customers in the region are frequently searching for the best deals possible, and efforts must be made to maintain loyalty. Customers in Southeast Asia and China also seek warm online interactions with retailers, as 60% of these shoppers are used to informal messaging with sales representatives. In order to generate repeat customers, companies in Southeast Asia must develop a strong connection with and between customers.
As blockchain technology has begun to send ripples of change throughout every industry in the region—from finance to supply chain and big pharma, to real estate, collectibles, and beyond—one aspect of these innovations that has remained overshadowed is how blockchain will impact consumer loyalty. More specifically, Southeast Asian companies are looking to implement blockchain to create more transparent and beneficial systems that naturally give consumers and users more genuine reasons to remain loyal over time.
Here are 3 ways blockchain is changing how brands encourage customer loyalty:
1. Providing open-source tools that encourage community-driven innovation
One of the most effective ways to spark loyalty is to give users the ability to impact the very tools and platforms they are most loyal to.
A great example of this is seen specifically in the gaming space, where blockchain companies are looking to create ecosystems that allow developers to collaborate more effectively.
For example, MagnaChain, a built-from-scratch public blockchain, recently announced it is spearheading its initiatives by providing game developers with the software development kits (SDKs) they need in order to seamlessly bring their previously designed games, or build new games, directly onto the blockchain. MagnaChain has also secured a number of business partnerships to ensure developers are provided with a diverse and effective ecosystem, including Epic Games, Korea Mobile Game Association, Smartchain Media, and more.
By giving developers both the tools and the distribution partners they need in order to be successful on their own, MagnaChain is encouraging loyalty in a way that is organic and earned. And as more and more blockchain platforms look for ways to disrupt outdated and inefficient industry systems, this approach of putting the power into the hands of users will become more and more popular.
2. Allowing users to choose how much data they want to share
One of the hot-button issues right now in the digital world is user data—specifically, who should “own” it, and what responsibilities companies hold in managing or selling user data.
One platform that is currently working on this initiative is ReChain, leveraging Ethereum’s Smart Contracts to ensure users can decide how much of their data they share with brands and advertisers—and if they do “opt in,” sharing in the upside. The context of this initiative, however, is the impact this sort of model shift will have on the brand and consumer loyalty space as a whole.
As it stands today, loyalty programs are focused mainly on gathering data to retain customers and grow their business, yet only 16% describe the data they receive as ‘very good’, and 57% say the biggest challenge they face is improving the quality of their data. When you combine this with the fact that $100 billion worth of points go unredeemed every year, it’s clear that there is a disconnect between the brands and the users.
In the case of Rechain, users are incentivised for providing valuable targeting data to the brands they want to hear from, and conversely, brands are given better targeting solutions and the opportunity to provide improved rewards in exchange for loyalty. It’s this sort of win/win approach that will not only provide both brands and customers with a shared benefit, but will allow the entire branded loyalty space to make strides forward in terms of transparency.
After all, brands and companies don’t benefit from irrelevant data being shared—and neither does the customer. By improving the way both parties exchange value, loyalty becomes a relationship that’s earned, instead of a data point that’s leveraged.
3. Letting users know what’s occurring on the platform, every step of the way
There is no clearer example for transparency leading to loyalty than across a supply chain.
One of the biggest issues companies reliant upon supply chains face is ensuring parties remain informed at every step. But by leveraging blockchain technology, companies are beginning to realize that by upholding a higher level of transparency, they can forge a deeper and more meaningful connection with both consumers and necessary partners.
For example, in the food space, one of the most important qualities a company can prioritize is ensuring customers are always being delivered safe products. A single food scare, or E. Coli outbreak, and suddenly the company not only has a public relations disaster, but it has to climb back uphill to earn back its customers’ loyalty.
In late 2017, Walmart announced it would be teaming up with IBM and Tsinghua University in Beijing to “digitally track the movement of pork in China on a blockchain,” according to Fortune. This would allow Walmart to more accurately and effectively target affected shipments, or food products that fell below cooling temperatures, ensuring its safety.
These kinds of examples prove that blockchain technology is well on its way to solidifying a new kind of customer loyalty—and it’s not one that can be bought. Instead, companies will have to work hard to earn customers by providing them with the tools, the insight, and the power to make their own educated decision.
e27 publishes relevant guest contributions from the community. Share your honest opinions and expert knowledge by submitting your content here.
The post Beyond consumer targeting, here are 3 ways blockchain fosters customer engagement and loyalty appeared first on e27.