Blockchain could be defined as a public ledger to record transaction across many computers. It is a decentralized system where data is open to everyone. If a particular record has to be added to this chain of data, the transaction has to be approved by all systems interconnected to it. This makes transactions extremely secure. If a particular record needs to be altered then entire change structure must be altered. This rules out the possibility for a retroactive/retrospective alteration of data. Hacking data is out of the picture using blockchain. No data is stored in individual databases – it is a fully decentralized network, that’s how it works. The power is distributed equally to all system interconnected to it. Without a doubt, blockchain is the most secure and hack-proof technology that is being put to use to date. Here are some possibilities of how intelligently blockchain changes loyalty program concept forever: Stripping off value for points will never happen again! Companies who run/operate loyalty have the authority over points awarded to customers. Wallet belongs to the customer, but points in it can be devalued/forfeited anytime by the rewarding company. There are instances where points become null and void if not redeemed before a certain date. Such situations will taper off with blockchain technology. Using blockchain loyalty, these points (often called as tokens) once entered in public ledger will be considered as/converted to cryptocurrency. Thus points never lose their value and are valid perpetually – just as how our money is in a bank. Points also become inter-portable. Are you a customer who loves to experiment with more brands? Then you would have experienced the below crisis. You might have earned points that are yet to be redeemed with the previous brand. After switching the brand, the points gained/earned become invalid. You are naturally disappointed. With blockchain loyalty, no point is worthless or invalid. They are cryptocurrencies indeed. Points gained from one company can be used for redemption of benefits from other company and vice-versa. Customers can then handle points like cash – can use it like real money. The ‘point balance’ customers have in their wallets can be used as per their will- it can be redeemed to avail gifts or these points can be used to pay household bills and so on. The democratic network called blockchain Blockchain will improve customer involvement definitely. But companies have to come up with a policy for points exchange. It is an open and transparent network. The concept of individual databases will vanish and a single block chain server comes to rule over the internet. It is indeed a democratic network- all concerned systems should vote for approval of a transaction by ledger. Firms around the world are researching to implement blockchain technology in loyalty programs and it will be very interesting to see how revolutionizing the whole concept will be in our daily lives.
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