Getting customer loyalty ‘right’ in the cookieless age of NFTs
Article by Billy Loizou, VP Go To Market APAC, Cheetah Digital
The proliferation of non-fungible tokens (NFTs, as they’re commonly called) is generating hot debate, and a heavy dose of confusion. We’re seeing people spending hundreds of thousands of dollars on a digital piece of art, and brands like Dolce & Gabbana, Reebok and Gucci making headlines with their NFT investments.
All of this begs the question, how do NFTs help drive brand engagement and customer retention?
NFTs: The new driver of loyalty?
The movement of NFTs is a digital contract of sorts. It could be art, or it could be something like a specialty Starbucks cup. Say the brand releases 100 NFT badges of specially designed coffee cups, and customers who are a part of its loyalty program can buy those NFTs, gaining certain benefits like a lifetime supply of free coffee.
Billy Loizou, Vice President, Go To Market APAC at Cheetah Digital
This is where NFTs become a smart contract between the consumer and brand. It’s something a brand can add to at any time, and even more, it has the extra appeal of exclusivity. It makes people feel like they’re part of a special community.
Recently at the Australian Open (AO), Tennis Australia released almost 7,000 3D NFT tennis balls that could be purchased with digital cryptocurrency at a rate of 0.067 ETH, or the equivalent of AU$310. Each tennis ball was unique and featured its own metadata that was linked to a small 19cm X 19cm plot of tennis court surface.
If the winning shot from any of the 400-plus AO matches landed on the plot, the NFT metadata updated in real-time to highlight the match information while providing the ball’s owner with rewards, ranging from limited-edition wearables to metaverse event access or future benefits.
At any given time, anyone who bought one of those tennis balls can gain access to things they don’t even know about yet. Tennis Australia could turn around tomorrow and give them a signed tennis racket from their favourite tennis player. There are no rules. NFTs are simply a contract between the consumer and the brand.
It’s diverse, and it’s complicated – but it’s also up to the most creative minds to figure out how to use this technology to drive brand loyalty. We’re going to see quite a few brands start taking advantage of NFTs, and to escape the hype around NFTs, it will take assigning them a lifetime value to give them a form of utility.
Brands need to consider what they will unlock for the consumer. They need to think about what kind of rewards they can tie to NFTs to get people to not only buy them but buy into the idea of them and adopt this new style of loyalty. There’s a lot of opportunity to capitalize on here.
Loyalty no longer an ‘afterthought’
It used to be that loyalty was an afterthought. Marketers would be talking about trialing virtual reality, launching NFTs, doing great TV campaigns with a big actor starring in them, etc. Now, loyalty is going to have to be at the forefront because it’s one of the biggest things that will help position your company for the future.
Loyalty is key to driving that connection. If you can package up a great value proposition, whether it be a membership, subscription or punch card program, customers will give you their information.
Cheetah Digital’s 2022 Digital Consumer Trends Index revealed that 50% of consumers are comfortable sharing data about themselves if it means better service. In fact, 52% are willing to trade personal and preference data to feel part of a brand’s wider community.
Getting back to basics in the cookieless era
Brands have been using cookies for years to track website visitors, improve the user experience and collect data to efficiently target the right ads to the right audiences. Cookies also help to figure out where customers are looking online when they’re not on our websites.
As we know, the death of the third-party cookie is near, with Google announcing its eradication in 2023. Google is changing its privacy laws; so is Apple.
If third-party advertising is driving the most attribution to your brand’s marketing efforts, then it’s time to find a new way to connect with your customers. That’s where loyalty comes in – perhaps the most important tool for marketers in this new era of privacy.
With all these new privacy changes, it’s time to get back to the basics of marketing. Build a value proposition, find a reason for people to engage, and then acquire them. Create your own customer database that you can gain insights from.
Loyalty done right
True loyalty is not a points program or a rewards card. These are, of course, tactics that bring brands and customers closer together, but genuine loyalty is an outcome. It’s a goal that can only be achieved by carefully nurturing every relationship you have.
The Vans family offers a perfect example of this concept in how it moved away from transactions to interactions. Vans wanted to reward its customers for engagement. It was about connecting their social accounts, referring friends, and sharing photos with the community to name a few. For each interaction, Vans rewards its customers with points that can be used to redeem loyalty rewards, ranging anywhere from skateboard stickers to a 24-karat gold skateboard ramp.
The beauty of this engagement is that it gives Vans the ability to profile its audience, learning things about them to then leverage for brand partnerships. For example, if Vans’ customers have a great affinity for music, this could be a great opportunity for the company to partner with a brand like Beats. Or if Vans finds out its customers like pets, it could release limited edition dog stickers or collars. This kind of information transcends the loyalty program. We’re starting to see a big movement where brands are spending more and trying harder to connect with their consumers in new and better ways.
The views in this article are that of the author’s and do not represent the views of this publication.
About the Author
Billy Loizou, Vice President, Go To Market APAC at Cheetah Digital
https://www.linkedin.com/in/billyloizou/
Billy Loizou has over 10 years’ experience in design, technology and marketing. He has worked with some of the world’s most renowned and respected brands, helping them improve their customer experience and drive profitability.
About Cheetah Digital
Cheetah Digital is a cross-channel customer engagement solution provider for the modern marketer. The Cheetah Digital Customer Engagement Suite enables marketers to create personalized experiences, cross-channel messaging, and loyalty strategies, underpinned by an engagement data platform that can scale to meet the changing demands of today’s consumer. Many of the world’s best brands, including Starbucks, Hilton, Neiman Marcus, Levi’s, and Williams-Sonoma trust Cheetah Digital to help them drive revenue, build lasting customer relationships, and deliver a unique value exchange throughout the customer lifecycle. To learn more, visit www.cheetahdigital.com.
Recent Comments