Web3 Loyalty Platform:
A Comprehensive Guide on Creating NFT Loyalty Programs

The Pain Points a Web3 Loyalty Program Addresses

As we focus on Web3 loyalty programs, the question of why these platforms are beneficial comes into our minds. There are several pain points in the existing customer loyalty system addressed by Web3-based loyalty platforms. The points below reflect some of the problems encountered by conventional loyalty programs based on Web2 technology.

• Existing loyalty systems use Web2 technology that relies on centralized technology for storage and data processing. This can open up opportunities for malicious actors to hack and access sensitive user information, which might lead to unsavory outcomes.
• Web2 loyalty applications are opaque in nature, making it difficult for customers to ensure the program’s integrity and activity. Some programs have unclear ways of allocating points and rewards that make them unappealing to customers.
• Most traditional loyalty models focus on short-term business goals for companies offering them. Doing so might not be sustainable in the long run as market trends and user sentiments change over time.
• Users of a Web2-based loyalty program cannot transfer their loyalty points or rewards to another user for tangible benefits. Such nature renders these points useless in case the user is unable to use them anymore.

What are the Types of Web3 Loyalty Programs?

Web3 loyalty programs aim to solve the issues encountered in existing loyalty systems, and they accomplish this in several ways. A brand can run a Web3 loyalty platform that taps into multiple forms of customer loyalty schemes. The below points shed light on some of the prominent types of Web3 loyalty programs.

• Points-Based: Points-based loyalty programs entitle customers to unique NFT rewards that represent data about their purchasing behavior and preferences. These NFTs can be used in future purchases that align closely with their usual preferences once sufficient points are accumulated.
• Purchase-Based: These NFT loyalty programs activate once a person buys a product. These programs shower users with numerous benefits associated with the product over time, making the purchase highly valuable.
• Value-Based: Value-based Web3 loyalty programs are based on a company’s contribution of a portion of profits to noble causes. Through these programs, businesses can establish themselves in a good shade, making customers feel included in the process.
• Tier-Based:These NFT loyalty schemes can let users access specific tiers that provide varied benefits to token holders. These programs can even have provisions for upgrading levels based on factors like completed purchases.

How Do NFTs Come into Play Here?

With loyalty programs powered by Web3 technology, NFTs play a pivotal role in executing them. Non-fungible tokens come with several novel advantages, including immutability, security, and uniqueness, and loyalty programs can reap immense benefits. Here is how Web3-based loyalty programs utilize NFTs to fulfill their novel goals:

• NFTs can represent digital loyalty cards that can be loaded with points in the form of cryptocurrencies. These NFTs can be in the form of profile pictures or digital collectibles, which can be static or dynamic in nature.
• NFTs can represent redeemable loyalty coupons that can be redeemed for digital or physical rewards. Real-world brands prefer using such NFTs to supplement their offline operations and appeal to their long-standing customer community.
• NFTs can back exclusive access to services inside the project’s main venture, similar to membership cards. Such services can include premium access to virtual-world and real-world provisions of a project.
• Non-fungible tokens can also represent upgradable membership passes, which are useful for tiered loyalty program mechanisms. NFTs created using dynamic mechanisms are used for these tokens as users can pass through tiers by completing in-program tasks.

Predominant NFT Loyalty Program Rewards

An NFT loyalty program can offer several kinds of rewards to its customers as a means to foster long-term consumer relationships. From simple NFT cards to complex and upgradable passes, NFT loyalty program rewards can take diverse forms, both in terms of visuals and utilities. The below points shed light on the reward types used in Web3 loyalty platforms:

• Profile Pictures: Profile picture membership NFTs that can evolve with time based on the user’s activity can be used for loyalty programs. Dynamic smart contracts are used for the purpose of enabling users to begin with basic rewards, which can rise with time depending on their activity in the application.
• Membership Tokens: NFT memberships can be used for loyalty programs for digital and real-world projects. These tokens can be used to offer tailored rewards for user activity on the platform. They can be represented through visually appealing images or updatable digital discount vouchers, which can be redeemed in the future.
• Access-Gating Tokens: Access-gating tokens can be used to offer exclusive permission to special discounts and presents to token holders. Access can be given to offers on purchases, priority access at physical outlets, and personalized gifts to NFT holders. These tokens can be treated akin to digital membership cards.
• Layered Tokens:Layered tokens can be utilized in an NFT loyalty program to replace traditional tiered programs. These tokens can be used by brands for tiered rewarding schemes where tokens can be upgraded with time as users complete tasks like in-platform missions or purchases.

Popular Brand NFT Loyalty Programs Right Now

An NFT loyalty program can offer several kinds of rewards to its customers as a means to foster long-term consumer relationships. From simple NFT cards to complex and upgradable passes, NFT loyalty program rewards can take diverse forms, both in terms of visuals and utilities. The below points shed light on the reward types used in Web3 loyalty platforms.

• Starbucks: Starbucks’ Odyssey has been the global coffee connoisseur’s NFT loyalty program on the Polygon network. These NFTs are an extension of Starbucks’ existing customer loyalty program that offers classic experiences filled with premium real-world perks. The program consists of gamified tasks called Journeys that token holders have to complete to earn Stamps.
• Burger King: Burger King’s Web3 loyalty program utilizes a simple method that consists of QR codes packed with meals. On scanning, these QR codes offer NFTs, which a user has to collect until the whole set is complete. On collecting all, a last NFT is offered that can offer great rewards. Benefits include digital collectibles, a free supply of food for a year, and brand merchandise.
• Lufthansa: Lufthansa’s Uptrip NFT loyalty platform on the Polygon network presents token holders with NFT passes when airline boarding passes are scanned on the app. These can be redeemed once a specific collection is complete. Rewards include flight upgrades, airport lounge access, frequent flyer status, and award miles.
• Taco Bell:Taco Bell’s NFT loyalty program used artworks from popular Web3 artists around the world converted into NFTs called NFTacobells. These NFTs came as GIFs that were sold for thousands of dollars. These NFTs came with e-gift cards loaded with $500 worth of credit, which can be redeemed at Taco Bell outlets.
• Clinique:Clinique’s Web3 loyalty rewards scheme taps into contests where shoppers can register themselves and earn a chance to win gifts. Rewards include free products from the beauty brand for ten years and exclusive NFT artwork. The program has gained immense support from the brand’s customer community around the world.

Pioneering Features Your Web3 Loyalty Platform Should Have

In case you are planning to operate a Web3 loyalty platform, remember that the best programs come with features that are remembered for a long time. While the platform might not be vastly different from any other Web3 application, there are several elements that make it align with the goals of customer loyalty schemes. The below features make up the bulk of an NFT loyalty platform:

User Profile
User profiles in an NFT loyalty application can let people create their in-app profiles and look at their collected points and NFTs. The portal may or may not require a user to connect their crypto wallet, depending on the program’s working nature.

Storefront
The storefront can list NFT collectibles representing the loyalty scheme. Based on the program’s nature, NFTs can represent tiered memberships or one-time ownership cards. Users can visit this portal and purchase NFTs they are interested in or qualified to purchase according to preset conditions.

Product Listing
The loyalty platform comes with separate product listing portals for NFTs that show relevant information about these items. Details can include creator, price history, ownership history, perks attached to the NFT, associated collections, and more.

Search Engine
A search engine with advanced functionality can be useful in the loyalty app. It allows people to search for their favorite NFTs through relevant search terms, filter topics, and sorting elements. This feature can greatly improve user experience by enabling them to access the platform more seamlessly.

Payment Gateway
The Web3 loyalty platform comes with an integrated payment gateway that supports major cryptocurrencies and fiat currencies. Payments can be made through various modes, including crypto wallets, credit/debit cards, and bank wire transfers. Providing diverse pathways for payments lets users trade NFTs easily.

Redeeming Portal
The redeeming portal in the NFT loyalty scheme enables users to redeem their NFTs into tangible or real-world rewards. Ways for the redemption of rewards can include QR codes, bar codes, digital vouchers, virtual credits, and cashback. This is the most important aspect of an NFT loyalty program.