- Do cryptocurrency's have a role to play
in loyalty programs?
To understand, let's review
the history of loyalty currencies.
Egyptologist's have uncovered evidence
that ancient Egyptians practised
a type of reward program,
similar to modern
frequent flyer programs.
Workers were rewarded with
tokens shaped like beer or bread
which they could exchange
for the real thing.
Bonuses were paid to
those higher up the order
and excess tokens could be redeemed
on other products and services.
A more modern history of
loyalty program currencies
can be traced to the 1700s.
In 1793, a U.S. merchant
began rewarding customers
with copper tokens,
which could be used for future purchases,
thereby generating repeat visits.
The idea was quickly
replicated by other retailers.
The Grand Union Tea Company
was formed in 1872 in Pennsylvania.
The owners chose to sidestep retailers
and sell their product
directly to consumers.
They rewarded customers with tickets
which could be collected and redeemed
for a wide selection of products
from the company's annual
catalogue of premiums.
In the 1890s, marketers turned
to the physical stamp to
reward loyal customers.
Customers earned stamps
when making purchases
and were encouraged to stick
them into collecting books.
The books could then be exchanged
for a wide range of rewards.
The Sperry & Hutchinson Company
came to dominate this type
of loyalty currency approach
with their S&H Green Stamps.
The 1980s marked the beginning
of the end for stamps.
The recessions of the
1970s created hardship
for Sperry & Hutchinson,
as retailers partners
sought any way they could
to cut costs.
Around the same time,
American Airlines launched
the world's first currency-based
frequent flyer program
using a new currency, miles,
which corresponded to how
many miles a member had flown.
Brought on by increasing
competition with the de-regulation
of the U.S. airline industry in 1978,
the American Airlines AAdvantage program
was soon followed by similar plays
from United Airlines, TWA, and Delta.
From Egyptian tokens, to copper tokens,
to tickets, to stamps,
and then to points and miles,
loyalty currencies rise and dominate
and are then replaced by
something more effective.
With the rise of cryptocurrencies,
can we now expect points and miles
to follow in the path
of copper tokens, tickets and stamps?
To read more about
the history of loyalty
program currencies,
visit blockchainloyalty.io,
a global resource centre for
everything blockchain loyalty.
