Loyalty industry is at the best position to bring blockchain to the masses
One thing becomes apparent when looking at reasons why blockchain has not yet reached mass adoption — blockchain is treated as cryptocurrency.
And although we all understand that it’s not the case, lack of other coherent and more popular use cases cause this natural association. Soft drinks have Coca-Cola, painkillers have Aspirin, hot tubes have Jacuzzi, and internet has search. Every innovation needs it’s own horse that takes it to the masses. Price volatility and constant hacks clearly suggests that cryptocurrency is not necessarily the best horse for blockchain to raid on to the masses.
Why has mass adoption have not happened yet
In summary, 3 main reasons cause delay:
- Unclear benefits
- Barriers to entry
- Lack of regulation
Traditional businesses as well as regular users are biased by all the bad press and don’t see clear benefits as to why blockchain will help their businesses or daily lives. It is too difficult to understand, it requires too much time and effort to learn and quantifying time or money saved with blockchain as opposed to existing systems is currently impossible.
Very rightly so. How can a small company’s owner realise the potential of blockchain to his business when all he hears about blockchain is a bunch of terms like hash power, bitcoin price volatility, distributed ledgers, etc. that are alien to his day to day life.
Not to mention price of blockchain developers that are nowhere to be found. It is very likely that until there are standard business applications on blockchain, that do not require in-depth technical knowledge and are reasonably priced, this business owner and most of his peers will not even look into the potential of blockchain to their businesses.
Regulators operate in big bureaucratic mechanisms that are slow to follow innovation. Let’s’ look at history for analogs.
First steps towards international harmonisation of vehicle regulations were made in 1952, 66 years after the first car was invented. Radio broadcasting started in 1905 and was followed by radio act in 1927. And whether we date the internet back to 1980s when Tim Lee Berns invented World Wide Wide or 1990s when it became popular, we see that regulation is still evolving and changing.
And actually it’s a good thing. We don’t want regulators to shape the industry before the industry shapes itself. So while we need regulation to protect general public, we also need time to show the potential of blockchain so that regulations evolve to it’s best interest.
But why do we need mass adoption in the first place
- Increased scalability
- Faster progress
- More innovation
We’ve come a long way since a computer took up the whole room. Smartphones are now 220 000 times faster than Apollo 11 guidance computer and it takes just couple clicks to conduct most of desired calculations as opposed to days for changing any program.
A modern person’s life runs on processors that are barely visible yet capable of automatically controlling temperature at our homes or enabling the fridge to order groceries on it’s own. And although microprocessors were getting smaller and smaller even before mass adoption, real progress in processing power happened in late 1990s.
Mass adoption also guarantees quicker progress in size, features and usability. A simple example can be found in digital marketing, a significant audience size is required to A/B test a website design and the quicker this audience is reached, the quicker we start making profit.
Same with cars, TVs, phones, home appliances and many more convenient things that surround us today. Even 30 years back vacuum cleaners were massive, not so powerful and difficult to move around. Now, they almost don’t need us to clean our homes. With high demand, clever people start working on ways to meet and exceed expectations with more convenience.
This also leads to innovation.
If it wasn’t for steam engine or light bulb, who knows we where were today. Innovation is a gradual process where small steps are interdependent and in most cases could not exists without one another.
So while many think that social networking and sharing economy are the apogees of our lives, it is virtually impossible to predict in what ways blockchain will change our lives. The true revolution might come when we pass the stage of trying to apply it for current systems and rather start really embracing decentralisation with an open mind.
So how to facilitate mass adoption
- Standardisation
- Usability
- Education
Very simple answer — we need standards in easily comprehensible language, development tools, plug and play applications, APIs, logins, security processes and everything surrounding this technology. Regardless that Bitcoin is technically 10 years old, we’ve seen much more resource and attention to the space since late 2016 and 2017 really. So asking for these standards just two years in, is silly at minimum. Good news is, that despite few scams, many motivated companies has raised enough capital via ICOs to really work hard on those standards.
Once standards are taken care of we can expect to see them translate into usability for both businesses and users. Until blockchain is capable of delivering value in just few clicks without threats for lose of identity or money, we cannot expect masses to value blockchain as we do. The good news is that we already have internet and seamless interfaces that can be used to facilitate the process. General audience doesn’t even need to know that they are signing up to blockchain products.
And by providing masses with convenience, we’re able to slowly teach about the remaining benefits. Long gone are the days when the only way to learn was by listening to somebody throwing theories at you. We’re much better at learning through doing and experiencing. So regardless, how many success cases and educational material we produce, until we show the benefits of blockchain in an experiential way, we can’t expect masses to all of the sudden quit conventional systems over blockchain.
And why loyalty is at the best position to mainstream blockchain
- Coherence & minimum to zero risk
- Add-on to businesses
- Showing not telling
Loyalty points and crypto tokens are very coherent.
From consumers’ perspective transition from collecting virtual points to being rewarded in crypto tokens is very seamless, yet very beneficial. Moreover, consumers who were once reluctant to buy crypto tokens, can all of the sudden earn them without any risk to their wealth. This makes loyalty a very attractive entry point to the blockchain revolution.
Most traditional businesses consider loyalty as an add on or a feature instead of a main integral part of their business. Hence trying a blockchain loyalty solution that is free and doesn’t require much or any development is a very safe way to explore the benefits of blockchain. So loyalty industry is at a very good position to introduce traditional businesses to blockchain.
Most importantly, loyalty industry allows to create seamless interfaces and experiences that resemble traditional systems, yet with added value of liquidity, transparency and traceability. By firstly giving tokens as rewards and only then teaching about the benefits over regular loyalty points, we have capacity to bring blockchain to the mainstream.
Dealoyal is mainstreaming reward tokenisation
Our vision is to help mainstream reward tokenisation by building a decentralised and autonomous loyalty ecosystem based on interoperable open source protocols that are seamless to implement and use, guarantees relevancy and adds value to the whole community.
Application layer protocols for data Collection, performance Optimisation, Rewarding behaviours and Using rewards (CORU) ensure adaptability, scalability and decentralisation of the current Dealoyal solution as well as loyalty industry as the whole.
3rd party companies like other loyalty platforms, airmiles, retail loyalty programs or any business wanting to tokenise their loyalty points can use these protocols to easily build custom loyalty experiences, minimising set-up cost and maximising value for their business and their consumers. On top of that, using CORU protocols comes with 0% commission which allows for full value of transactions to be exchanged between businesses and their customers.
Find out more about Dealoyal solution on our whitepaper.
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