LoyaltyX Encouraged by Favorable Results in Cryptocurrency Tests
By Richard Pachter
For marketers seeking new ways to incentivize purchases, the siren song of cryptocurrency beckons. But if all that glitters isn’t gold, the value of this make-believe money may be equally elusive — though that hasn’t stopped an Australian entrepreneur from getting state government support in this effort.
LoyaltyX founder Philip Shelper told SmartCompany:
“If you look at the history of loyalty programs and similar systems, it went from clay tokens in ancient Egypt, to copper tokens in 1700s America, to stamps in the 1800s, and then finally the modern day system of points and miles. We see that there’s an opportunity for crypto to be the next loyalty currency around the world.”
The company recently completed a round of trials at the University of New South Wales’ on-campus retailers. Customers received $10 worth of LoyaltyX’s crypto currency for every 10 purchase points.
The test was made possible with a $15,000 grant from the NSW government’s Boosting Business Innovation Project. Deputy Premier of New South Wales and Minister for Regional Development, Minister for Small Business and Minister for Skills John Barilaro said the program “brings business and research brains together in one place to develop new ideas and opportunities.”
The sample size was 170, which may not be statistically decisive, but the numbers were sufficiently encouraging to LoyaltyX founder Shelper.
“The results were overwhelmingly positive. We found that those staff and students would prefer to receive crypto over normal points as they liked the idea of it being a ‘live’ currency that would increase in value over time,” he said.
To that end, the company is now planning a wider deployment of its program, per Shelper.
“We’re currently in advanced negotiations with a number of retail chains in the UK, where we’ve landed seed funding from two significant investors, with plans to run an Initial Coin Offering (ICO) mid-year, then launch a full coalition program before Christmas. We’re starting with mid-level retailers (50-200 stores) and will work our way up from there.”
“Crypto is the opportunity to hit the reset button on loyalty… the reason crypto has so much potential is because they create better value to members. If more retailers provide an opportunity earn this currency in a loyalty program, and more members are using it, then the value increases and everyone benefits.”
Richard Pachter is Editor at Large for The Wise Marketer.