Consultancy firm EY India has built a blockchain-based solution for loyalty management that it is now taking to its global clients.
According to EY, the solution allows for interoperability of loyalty points among ecosystem partners, offers transparency and tracks near real time transactions.
“There are loyalty solutions that already exist in the market. What blockchain does is there is a common shared ledger between the whole ecosystem. So, everybody has trust in the transactions that is put in (the ledger),” said Gaurav Handa, director, advisory services at EY India. Blockchain functions as an online record-keeping system that is maintained by a random group of peers rather than any central authority. While it is best known for underpinning the widely popular bitcoin and other cryptocurrencies, many believe that the burgeoning tech will change the way how transactions are handled.
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PRIMED FOR DIGITAL
“The solution will help resurrect loyalty in the digital age by providing a one stop shop offering for all its stakeholders in an increasingly competitive landscape,” said Ram Sarvepalli, EY India advisory services leader.
In the case of loyalty programmes, the incumbent solutions that exist are not easily interoperable and raise problems during reconciliation. For instance, say SBI offers loyalty points to its customers.
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Converting these SBI points to say British Airways air miles or an Amazon gift card currently takes time, and in most cases, is not possible. “If blockchain sits as a layer on top of these existing systems, the conversion and interoperability become near real time,” Handa said.EY is working with an Indian startup to solve the ‘token economics’ (conversion) problem. The consultancy said that it has on-going POCs with a few clients, but refused to disclose names.
EY said the solution addresses all contours of the loyalty management lifecycle from loyalty strategy and governance, to partner management and support.
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PERFECT FIT
The solutions, EY said, can be customised for small businesses looking to introduce loyalty programmes or for large conglomerates looking to maintain existing loyalty programmes while creating interoperability.
Recently, Singapore Airlines introduced KrisFlyer loyalty programme that allows frequent flyers to use their accumulated air miles.
The company built its own private blockchain involving merchants and partners to enable the programme. Other consultancy firms and Indian IT services companies too have developed private blockchain solutions.