Blockchain technology could revolutionize the way businesses market to and retain their customers.
In fact, it has the potential to improve businesses in big ways. In the finance industry, for example, the estimated annual savings for banks is $8 million to $12 million annually.
Blockchain is a digital technology that provides a new model for sharing and securing data, making it easier for businesses to work cooperatively together via the internet.
The concept is based on blocks. Each block connects to create a chain. The blockchain database allows data to be stored in a decentralized system. Because no centralized versions exist, the data stored in the blockchain is effectively tamper resistant.
Think of it like a puzzle where each piece is in a different location. Without access to each piece of the puzzle, you can’t put the whole thing together.
Blockchain allows multiple users to access, inspect or add to the data. However they’re limited with what they can do as they’re unable to change or delete specific records.
When businesses work together in a blockchain system, they can provide their customers what they want, at the exact time they want it.
Blockchain + Customer Retention
Using blockchain technology allows businesses to operate and set up a Customer Retention-as-a-Service network. Because the data cannot be changed or deleted, the trail or chain is permanent and public.
Take Incent, a loyalty software built using blockchain, as an example. Incent uses blockchain technology to create tokens that all the merchants who use their network can use.
Merchants can then offer these tokens to their customers as rewards. The token exchange happens instantaneously. The tokens can be accessed through either the customer's mobile phone or web browser. Because of this omnichannel experience, users can transfer, sell or exchanging their tokens on open marketplaces for other loyalty tokens of fiat money.
Current users of loyalty programs face endless friction in the current system. Of the total membership in loyalty programs, 58 percent don't actively participate. And 94 percent of consumers say they would use mobile wallets that run via blockchain technology if it offered them the ability to earn and use loyalty points or tokens.
Blockchain technology allows you to manage your customer retention process in real-time. Because of the technological environment blockchain is based upon, the database entries are always time-stamped, meaning you can easily trace back a record.
Because the frictionless blockchain technology decentralizes the system, any merchant who is a part of the Incent network can utilize the tokens. This means customers are incentivized to come back and do business with that company again.
There are a finite number of reward tokens available, and this is set to increase as the number of merchants operating under the Incent network increases.
The key with blockchain is it is a technology that can be used with anything of value.
Blockchain technology can be used to help businesses retain more customers as it increases transparency within the transaction. Blockchain databases are public and permanent, meaning trust is increased, and bias is eliminated.
Customers understand that their data is secure and less likely to be hacked or tampered with, so they’re more likely going to want to do business with companies utilizing blockchain technology.
What About Scaling?
Blockchain technology makes scalability easy because you’re able to have any number of users accessing any number of the data points. This also makes it cost effective.
The shared ledger means that internal systems won’t require as many audits, so certain processes could be eliminated.
Although blockchain technology has its origins in the finance industry, it can also help merchants. In addition to improving customer retention, blockchain provides greater business efficiency and productivity
Blockchain technology means businesses are able to offer an effective and attractive customer retention system that entices customers to come back to do custom with them.