Experiential Loyalty and Driving Digital Collectable Integrations with Big Brands

When my Forum3 co-founder Andy Sack and I use the term experiential loyalty, it deserves some unpacking and some vision explaining.

A large part of Forum3’s thesis and vision is that the consumer is changing, loyalty programs are becoming less interesting, and branded digital collectibles are part of the opportunity set to change the trajectory of loyalty in general.

Let’s look at a basic loyalty program’s purpose and structure. It exists to give a brand’s customers something in return for their loyalty to the brand. How is loyalty measured? Spend. What does the brand give in return? Discounts and digital convenience, such as remembering your favorite items, address, and payment methods, suggesting items, and letting you order ahead.

Of course, consumers also get points towards discounts and convenience. And a point is just a point. Fungible, but with a single use case.

Does it work? 100%. Try taking this away from a successful spend-to-earn, point-based loyalty system and you will blow a hole in the bottom of a business. But does it address the needs of today’s consumer to be more engaged with their favorite brand, not as a “consumer,” but as a member of that brand’s community, as a part of that brand’s evolving story, and as a participant and co-creator? Not really.

Let’s double-click on the points themselves. Not exactly something most people spend their time thinking about much. Mostly they are just called points. They sort of feel like a digital asset, but you don’t really own them. Why would you want to? You accrue them, and then use them. That’s it. Starbucks at least calls them “stars” and gives the whole program a sense of excitement and action. But they are just points, or stars.

What if the points could come to life? What if, as part of a much more immersive loyalty layer to loyalty, you could receive points AND a digital collectible that you own and collect in either a fun or gamified manner, be programmed to because of which ones you owned, engaged in collaborations around them, and did storytelling around them? What if the rewards you received from them came in all sorts of different shapes and sizes (not just discounts and convenience), and you could decide which path to take in terms of what points to collect, what rewards you wanted to receive, and which parts of the broader customer community you wanted to engage with?

That’s what a branded digital collectible has the potential to do. And when connected to a rewards program that uses “points” in this new way, it becomes experiential loyalty. Still all about the brand-customer relationship, and rewarding the customer for their “loyalty”; but now the points, the rewards, and the loyalty program itself becomes an entirely different type of brand experience. It’s not all about the digital collectible, what it does, or what it’s worth. But it’s not all about just the “points” and the quid pro quo of transactions for discounts either. It’s both. It’s a new combination. And we think it’s the future direction of loyalty.

To bring this vision to life, it won’t happen in a month or even a year. It will take time to lay the foundations of the gamification layer, the experience layer, the rewards, and the digital collectibles becoming coveted, and for that to happen, the game itself has to be given time to be brought to life, with users having a reason to want to collect points to win and personalize their experience. And that’s true at the individual brand level, but also for the space in general.

It’s a new addition to the concept of the “digital flywheel,” and these always have to be built up brick by brick. When Starbucks created their digital flywheel — over the course of years! — they started with a gift card, then added loyalty points connected to spend on that gift card, then added a mobile app to make reloading, paying with that gift card, and seeing your points easier. Then they added airdropped content from Apple into the inbox of that mobile app, then added mobile ordering. All connected. All over a several-year period. But there was always a vision and north star for what it would look like when it was fully featured and clicking.

That’s true of how experiential loyalty will get built by many brands going forward. And that’s why blockchain technology can be a powerful foundation for the future of consumer loyalty programs.