How Crypto Can Turn The World Into Investors
Through Loyalty & Rewards Applications
Earning points or rewards through loyalty programs aren’t enough for consumers anymore. Soon social micro-investing into digital assets will be the new shopping.
For some time now, companies have been nudging consumers to earn points by shopping online, taking surveys, watching videos, reading email and much more. Consumers can then redeem points for gift cards, travel miles or cash. When consumers shop on one of the partner sites, the company gets a percentage of each sale. Some companies have become quite successful following this business model like Shopkick and Pilotly.
Some loyalty programs are worthwhile, such as credit card points, but as more consumers participate in brand loyalty programs, more of those points are going unclaimed — $100 billion — according to Bond Brand Loyalty’s 2017 Loyalty Report.
Companies do loyalty programs to make consumers feel love and become an extension of their brand. However, consumers aren’t taking advantage of the points they’re accumulating. “Some people don’t redeem because they are disengaged with the program, even to the extent that they don’t know their current points balance or what redemption options are available to them,” said Sean Claessen, EVP, Strategy and Innovation at Bond Brant Loyalty.
When consumers aren’t motivated to redeem points it can also cause a huge financial burden on the companies. Consumers are completely detached from the negative results if they have nothing to lose. They’d much rather be rewarded in a universal store of value. Balaji S. Srinivasan, previously CTO of Coinbase tweeted:
“If the internet turned the world into publishers, crypto will turn the world into investors. It’ll take a while, but small, casual, daily, social micro-investing into digital assets will be the new microblogging.” — Balaji S. Srinivasan
Giving consumers a streamlined means to earn from their purchases and contributions instead of merely giving away rewards that don’t appreciate over time will lead to even more value creation. I believe one example for companies to grow more collective skin in the game is through bitcoin. One company doing just that is Lolli. Lolli, which has received $2.3 million in funding, is a rewards application that gives consumers bitcoin for shopping at their favorite stores.
Owning bitcoin is advantageous for many reasons including its decentralization, lower fees than other traditional online payment methods, the worlds largest market cap and stock-to-flow ratio. Reduced friction will only lead to higher rates of conversion. As Lolli states on its website:
We started Lolli with the goal of making it easy to earn, own, and share bitcoin with as many people as possible.
We strongly believe in bitcoin’s power as a global alternative currency and universal store of value and want to share it with the world.
Lolli is the first bitcoin rewards application that lets people earn & own bitcoin when they shop online. We’ve partnered with 500+ top brands to help drive sales and conversions on their sites.
By simply shopping online at their favorite stores Lolli has turned the casual shopper into a passive investor. The model doesn’t just work for purchasing products. The same can be done with submitting original articles, commenting, streaming and reviewing visual content. Startups are building solutions for similar problems in varying industries like Brave, a free, open-source web browser where users can earn Basic Attention Tokens (BAT) for viewing ads and creating content. BAT is an Ethereum-based token that is designed to improve digital advertising on the web.
Across the board, consumer adoption of crypto is increasing. Square’s bitcoin revenue jumped to $65.5 million in Q1, its highest ever. Retail rewards and loyalty could represent a port of entry for consumers new to cryptocurrencies. Lolli’s bet is that it can become the crypto wallet for millions of consumers. Lolli, Brave, Square, and other platforms solve a distribution problem by introducing more people to crypto through familiar methods.
This micro-investing mechanism can enable other loyalty programs and reward applications to enhance the consumer experience, increase the adoption of people experiencing the utility of cryptocurrency and bring new financial infrastructure to the masses while supplying the constant presence of skin in the game. Micro-investing into digital assets could very well be the new shopping experience.