Today’s loyalty programmes are not about loyalty at all

Today’s loyalty models only attract consumers who are mostly interested in claiming the rewards, rather than being invested in the brand itself, according to a new report by Reddit, Salesforce, Media.Monks and Polygon Labs.

Called the Future of Loyalty, the report touches upon the lack of “genuine loyalty” towards brands and how building communities through Web3 can change that.

Salesforce’s State of the Connected Customer 2022 study found that 71 per cent of consumers switched brands at least once in the past year, citing better deals, product quality and customer service among the top reasons why consumers switched.

It says that the loyalty models are  more of “economic transactions” than “true affinity” for a brand.

The key to build a true affinity in consumers for brands lies in communities and Web3.

To build loyalty through Web3, brands focus on four aspects: membership, influence, shared emotional experience and need fulfillment.

Web3 membership is about making people feel like they belong to a community. The difference in Web3 loyalty and traditional loyalty programmes is the two-way relationship factor.

A form of a Web3 token or membership, NFT’s allow the members to become a part of system and reap rewards on the basis of their contribution through active participation.

Influence allows NFT holders to make decisions as a community and the power to develop and shape their community.

When people feel like they belong to a community that shares their values and beliefs, they are more likely to develop a sense of emotional connection and attachment to that community, according to the report.

A sense of ownership is created when community members use their skills and expertise to help the community achieve its goals.

Lastly Web3 meets people needs, the need for security and privacy of their data and helps them be more in control of their online identity.