Cryptocurrency in 2018 is working the edges of the global economy. In some ways, crypto seems like dot-com commerce did in 1993 when companies were dabbling with a new wave known as … online sales.
But what’s becoming clear — as companies like IBM, Goldman Sachs, Visa, and others invest in a cryptocurrency infrastructure — is that crypto is going to climb in acceptance. While Bitcoin may be the “Uber of crypto,” having been the first to establish brand awareness and disruption, others are following fast with better business models and management.
Author and crypto pioneer Andreas Antonopoulos calls crypto “The Internet of Money.” Perhaps, in time. But what the crypto space needs now is a company/crypto issuer to democratize crypto and make it legit for, say, average Amazon customers and people who are comfortable transacting the bulk of their purchases digitally. How? By tying the global currency to real stuff and real brands.
Enter Rewards.com, which has alliances with some 7,000 household and decades-old established brands, and thus is positioned, as it demystifies crypto, to perhaps become the darling of cryptocurrency.
Rewards.com has put its loyalty rewards on the Blockchain, creating a transformation of the loyalty rewards space that looks, on its face, as potentially disruptive to the loyalty-marketing industry as Uber has been to livery, or Amazon to the merchant economy. The stakes, and rewards, are high. There’s about $300 billion in points issued each year to consumers who sign up for loyalty rewards for everything from coffee to airlines.
How could this disruption work? Rewards.com’s recent shift to cryptocurrency for its rewards redemptions make it simple for members to shop at stores like Walmart, Lowes or Macys, and earn RWRD tokens to buy a flight or dinner. They can also use them outside the Rewards.com eco-system like Bitcoin or other cryptos. They can also hold RWRD tokens if they believe the value will increase. And by shopping through Rewards.com, users get loyalty points from the merchant, plus RWDS tokens.
By creating a new, simpler, marketplace for rewards redemption, Rewards.com’s model, in time, could crack the mass-market with crypto.
Does the comparison with Amazon’s rule of online sales hold
up? Amazon, in a way, dabbles in the same consumer reward space as Rewards.com, but with dollars. Amazon gives 5% back to Amazon Visa holders who shop, a program that now extends to the
company’s Whole Foods unit. That $50 we earn back on $1,000 of organic celery can now easily be used to buy shoes through Amazon. Consumers are getting used to this kind of connectivity in their
spending and rewards redemption.
According to Rewards.com Chief Development Officer Linda Butcher, the “aha” moment came
when they thought to decentralize the database that drives consumer engagement with loyalty buying and give consumers control of their own data and opens up the redemption
environment.” That, she believes, will appeal to members who get each Rewards point “tokenized.” Rewards is out to create a true community of crypto-using
“Rewards is giving control back to the members,” says Rewards.com’s Butcher. “With the new focus on privacy in light of Congressional hearings with Facebook, we’re giving control back to the members, so they can choose which storessee their information and how the information is being used.”
What’s really been holding back crypto? To start, there has been an air of mystery about “Blockchain,” as the term has been misused and misapplied in the media. That fogginess has hobbled the crypto environment and fed investor skepticism. That, in turn, has undermined understanding by wider audiences. “Many investors struggle to understand the value proposition of cryptocurrency because so many people use it for different things,” says Butcher. “Some people are buying and holding tokens like gold, while others are transacting with it.”
Rewards.com’s brand partners have an incentive to embrace crypto, too. The rewards industry grows at 30% a year, and 85% of consumers belong to at least one loyalty program. The average U.S. household, in fact, participates in 29 loyalty programs. That’s 3.3 billion loyalty accounts. This is an accounting and data management nightmare for companies, especially as many consumers forget about the programs or don’t engage, thinking the “reward” is too skimpy. But consumers do want to be rewarded for brand loyalty.
Just as Amazon built its success by aggregating merchants into one place for easy search-and-find, Rewards.com is in a position with its existing scale of partners to aggregate more rewards programs into Blockchain and crypto redemption.
Loyalty programs are ripe for disruption. Now, let’s see if consumers use this Rewards.com application as their portal into a new world of money.