Unlike many other NFT-based stories, the press reception has been surprisingly positive. Is this because the program's use is easier to understand than other digital collectibles projects? Is it because loyalty and rewards seem more useful and accessible than rarity?
To demystify web3 and learn more about what makes NFT rewards programs appealing, MediaPost spoke with Greg Consiglio, co-founder of Moonwalk, an NFT rewards platform on which creators like Kevin Hart can move beyond social media to directly engage fans with web3 technology and reward them with an NFT that unlocks a discount or exclusive content.
MediaPost: Why do you think the loyalty and rewards model is successful?
Greg Consiglio: I've been around loyalty and rewards and understand the psychology of what it means to chase points. The average American household probably has 20 loyalty programs in their wallets. People love to sign up for stuff that feels free or experiential and delivers status.
MediaPost: How do rewards programs translate to web3?
Consiglio: With web3 you can put assets on the blockchain. I can own an asset that is tied to a brand I love and use or trade that asset to another member of the community. That's an evolution of traditional loyalty: I can earn my status and use my status but I don't own my status.
It may seem like a minor distinction, but I don't own my airline miles, I use my airline miles, but my status is something that I could sell to someone else if I don't want to use that airline anymore.
MediaPost: Why do we need blockchain to further the usefulness of rewards programs?
Consiglio: Web2 has held on for a long time -- we've been in this social media environment with newsfeeds for 17 years and the new thing hasn't come along. To me, web3 is the new thing, but the real end game is metaverse experiences. That's where marketing and entertainment is all headed.We're nowhere near there today, but today is about using technology and software to seamlessly engage your audience and get them used to crypto wallets and NFTs. If I can get the audience used to those things, I'm building toward the future.
MediaPost: Do you think the metaverse is the future of exclusive content?
Consiglio: One hundred percent. A good example is Kevin Hart's NFT collection, which he built using our no-code solution. He's got a community called Kevin Hart Nation and a branded wallet.
People are earning Harts tokens for social engagement across his socials. Last week, he opened up a metaverse screening room and you can only gain access if you have one of his NFTs. You go to the door, via a simple URL, and it checks for the NFT in your wallet and you're in. There you'll receive exclusive video content.
People like Kevin, who pumps out content, are going to have metaverse environments where people have avatars and talk to one another while watching videos in a space gated by NFTs. I think that's where this is all headed.
MediaPost: Has the hype around NFTs discouraged a majority of people?
Consiglio: I think there's a misperception there. I'll read an article that says the NFT market is down. Well, the trading market established in 2021 and the volume of trading is down, it doesn't mean the NFT market is down -- an NFT is a technology that is just getting underway.
For those who view NFTs as a rarity tied to how we think of playing Pokemon -- sure, that's down, but that's just a trading market and it can be off-putting.
But it's different if you're just sending someone to a URL and they're clicking on a link to get access because they have an NFT in a wallet that they subscribed to with an email address -- which is what we do.
MediaPost: Do you think Starbucks' NFT loyalty program will spawn mass adoption of NFTs and web3?
Consiglio: Yes, I think it makes it easy for people to understand. They understand rewards, they understand tiered access and special privilege, so they may want to dip their toe in the water. It then comes down to user experience -- is it confusing or hard to understand?
Starbucks is referring to NFTs as stamps, which may also help mass adoption.
And it makes sense for marketers to be engaging an audience who don't have to know they're using web3 technologies, it's just a cool new way to engage with their brand.
MediaPost: So when it comes to mass adoption of web3, rewards are more effective then rarity?
Consiglio: Yes, even though Starbucks did say their stamps would also have rarity. For me to own my status in a rewards program, it doesn't have to be rare. If every Delta diamond member has the exact same NFT, that's okay.
MediaPost: Do you think recent security breaches on blockchain will deter customers?
Consiglio: The vast majority of breaches that involve people getting NFTs or crypto stolen happen when people are using web3 wallets and they have private keys associated with them. We took a different approach on behalf of our customers. If you're a brand, you have a custodial wallet that sits on the Moonwalk infrastructure which uses traditional storage -- we hold everything in a central place. Think of us as Shopify.
Say a big food chain working with us has sold NFTs to customers. We're holding a branded wallet where the NFTs are stored. If the user wants to take ownership of that NFT, they can connect a MetaMask wallet to the branded wallet and export their NFT to the open market, but the customer will never be dealing with custodial keys where passwords can be phished. All they have is one password connected to their social account or email. And people know not to give out their logins -- that's nothing new.
MediaPost: What do you think about decentralization in web3?
Consiglio: Ask a marketer today, if they're willing to invest in marketing campaigns, spend dollars and be completely anonymous and not know who their users are. They probably won't do that, not today, but maybe down the road. You can't go from having such rich first-party data to having no idea who anyone is. It's going to be an evolution, not an overnight change.
We need to start as a bridge between web2 and web3, and over time we can experiment with decentralized models. It will depend on big brand budgets and how the audience wants to engage.
If more people seek anonymity, that will dictate how brands
approach consumers, but offering loyalty and rewards may affect how much data consumers provide brands as well.
MediaPost: How is Starbucks' Odyssey announcement affecting the web3 rewards space?
Consiglio: It's great to welcome Starbucks to the web3 community. We're really excited to have a brand like that showing what can happen because most marketers are dealing with the top of the funnel -- audience engagement -- and the back -- loyalty, rewards, and CRM.
All of that is perfect for where we are in web3 right now, plus, the ability to sell NFTs and create new revenue streams.