TE-FOOD develops a blockchain based customer loyalty rewards solution
As the competition in the retail industry becomes fiercer with the growing options to shop, the emphasis will grow on customer loyalty and engagement.
Challenges of loyalty systems
Individual loyalty solutions for each retailer has strong disadvantages. Most customers don’t want several loyalty accounts, cards, and apps at each retailer, they prefer multi-provider solutions, where their rewards are collected in one central wallet, and they can use them anywhere amongst the participating retailers.
So, when customers go to a grocery store, they are credited with loyalty points based on their purchase value, and then they can go to a bookstore, and spend those points to lower the costs.
But this brings the biggest challenge of these multi-partner loyalty programs: it requires a complex multilateral clearing system to manage which retailers (where the points were credited) owe money to other retailers (where the points were debited).
Introducing blockchain as a customer loyalty solution
This is where blockchain based crypto tokens come in. Each participating retailer issues crypto tokens as loyalty points, and the solution manages the wallets for the retailers and consumers as well. When a customer wants to spend loyalty points in a cosmetic shop, which were collected at a supermarket, the system swaps the tokens in the background, and each retailer make the settlement with their own tokens.
This crypto token based setup brings another advantage to the loyalty program: Participants don’t need to contract each other in a multilateral structure, they just need one, bilateral contract with TE-FOOD, as the solution provider. This makes the legal part of such program much easier.
But the token based structure can even go further. It could give the possibility for customers to “cash out” a part of the points they collected with their regular purchases. By swapping their loyalty tokens to TONE, an established crypto token, it enables them to purchase ETH or BTC as well on exchanges.
The whole system can be managed by smart contracts to control the credit/debit transactions, as well as the swaps between tokens. All transactions get stored on the TrustChain, and expands the utility of the TONE token.
The crypto token based setup enables retailers, travel and leisure providers, fitness or healthcare services to join, additionally it can cover any direct to consumer service providers under one umbrella solution. Obviously, as such system grows, so grows the marketing potential for new joiners to have access to a large number of potential customers.
We have many years of experience
Such loyalty solutions are not new for TE-FOOD. Another company of the founders of TE-FOOD has been developing and maintaining the largest multi-partner customer loyalty rewards solution in Hungary, called SuperShop.
SuperShop, founded in 2000, has 3,5 million card holders, and performs 1,2 million card transactions per day, and the loyalty card is accepted on more than 800 points of sale.
Many years of experience in the IT side of such loyalty system helps TE-FOOD to develop an improved, blockchain based solution for international use.
This development has been added to TE-FOOD’s 2022–23 development roadmap. We plan to start the solution in Southeast Asia, where the retail spending growth is bigger, while there are yet fewer loyalty programs.
We believe this solution can be synergistic with TE-FOOD’s traceability solution as well, and can catalyze the blockchain transactions on the TrustChain, while expanding the utility of its underlying token, TONE.
TE-FOOD is the world’s largest publicly accessible, farm-to-table food traceability solution. Started in 2016, it serves 6000+ business customers, and handles 400,000 business transactions each day.
Website: www.te-food.com
