Our friends in the blockchain startup arena are always assuring us that loyalty programs will flourish with blockchain technology. Mostly, they are thinking that consumers will be able to trade their loyalty points outside the company's program, and we're not sure that will fly...
More likely, in our opinion, companies in the future will leverage proprietary blockchains. Rakuten (Japan's Amazon-type company) has millions of people on its existing loyalty platform, and they will be offered a pretty painless and safe opportunity to experiment with Rakuten Coin. We think that running the existing and a new platform, then encouraging people to transfer, is a good strategy. We wouldn't risk our savings in a cryptocurrency, but we would risk our reward points. (At least once!)
Sourcing Journal: Are Cryptocurrency and Blockchain the New Look For Loyalty? 2018-Mar-1 by Jessica Binns
Rakuten, the Japanese company best known for its e-commerce marketplace, announced at Mobile World Congress (MWC) that it plans to roll its existing Rakuten Super Points loyalty program into one powered by blockchain, leveraging its 2016 acquisition of bitcoin wallet startup Bitnet to create the Rakuten Blockchain Lab and develop a new cryptocurrency: Rakuten Coin.
In the 15 years since the rewards program launched, Rakuten has issued $9 billion in Super Points, Rakuten CEO Hiroshi Mikitani said during a keynote speech at MWC. Notably, Rakuten is also the No. 1 fintech company in Japan.
The company sees the potential for cryptocurrency rewards to fuel the growth of cross-border shopping as it attracts new customers from around the globe to its many interests, which include Ebates in the U.S. and Priceminister, the second-most-trafficked e-commerce site in France. A “borderless” currency would eliminate many of the pain points that international online shoppers often encounter, such as prohibitive customs duties and costly conversion rates. Cryptocurrency could also become the norm across all of Rakuten’s many touch points.