A recent examination of over 140 loyalty programs by Cap Gemini has shown that over 89% of customers reacted negatively to the loyalty programs they are members of. Likewise Telecom, Consumer Electronics and Retail sectors customers have shown a negative sentiment, with 96%, 94% and 93% respectively. What we see is a failure to build deep customer relationships and trust. Retailers fail to build a customer-centric model that improves loyalty and generates more revenues from a more demanding digital consumer, who receive little value for giving up personal data worth billions of dollars. Marketing has become a constant race which brands, merchants, and consumers are losing while trying to benefit more from each other . Physical retailers are facing declining sales since they don’t connect well with shoppers, especially millennials. With 29 loyalty program cards on the average per family, loyalty programs can have diminishing returns, while each one requires attention and demands personal privacy. Tens of billions of dollars in unused loyalty points become a major liability on balance sheets.
In the 1 Trillion dollar marketing industry, a cutting-edge blockchain technology could transform CRM systems and help to reach a consensus , bringing to the right balance in the relationships between stores, brands, and customers. Retailers should prepare to exchange control for a deeper customer understanding and loyalty maintenance costs reduction by 40-60%.
Blockchain CRM platform would enable a decentralized ‘coalition’ of merchants and enable to implement a much more accurate way of measuring loyalty by tracking both the level and types of engagements. Combined with Deep Learning and an IoT platform, Blockchain CRM provides a level of diagnostics and insights that uncovers how shoppers make purchasing decisions and when to deliver relevant messages. With Blockchain CRM, consumers get a “strong box” to control their personal data on an Ethereum smart contract, maintaining personal rules and preferences while merchants reward consumers for limited views of their portfolios with a token transferable across retailers . Thus, merchants will form a worldwide partner network based on existing IR network that already has millions of registered customers and loyalty points will become a real value, helping to get rid of centralized currencies disadvantages, taken to extremes in conventional reward systems