Blockchain Loyalty Programs Gain Traction Among Young Adults

According to Cointelegraph, the number of blockchain loyalty rewards programs has surged in recent years as the Web3 and decentralized application (DApp) sectors mature. Young adults, a highly sought-after consumer demographic, show a clear preference for participate-to-earn paradigms within focused ecosystems. Statistics indicate that participation in most Web3 and cryptocurrency products has peaked during periods such as airdrops or other limited incentive windows. While there are exceptions, projects that fail to gain consumer traction within the first few months post-launch tend to perform poorly. Loyalty programs designed to incentivize consumers have existed since the advent of currency and competition. From earning airline miles with credit card purchases to Microsoft’s pay-to-browse incentivization program, businesses have tried various customer retention strategies. However, their implementation in the blockchain and Web3 communities has been sporadic and inconsistent across different ecosystems. Some projects focus on cryptocurrency rewards that can be cashed out immediately, reducing the incentive to reinvest those funds, while others offer rewards that only exist on the platform where they were earned. In a recent roundtable discussion hosted by The Street’s Rob Nelson, a panel of insiders, including Paul Mikel, CEO and president of REVO Ride Share, Scott Lomu, CEO and president of Element United, and influencer Paul Cuffaro, highlighted tokenization and rewards as primary drivers of blockchain adoption. The group discussed blockchain’s potential to drive consumer loyalty through its implementation in the creator’s market. However, data from Consensys shows that influencers and freelancers make up a small percentage of the total number of people employed in the Web3 industry. It remains unclear whether current blockchain-based loyalty programs have led to measurable increases in user onboarding, as most firms do not release information related to the efficacy of their marketing efforts. However, an analysis of the most successful projects trending as of September 2024 shows that mini-dApps, Telegram games, click-to-earn games, and prediction markets are experiencing explosive growth compared to traditional loyalty programs. Simple experiences where incentivization is invisible or seamlessly integrated into user interfaces appear to be gaining the most traction with the largest demographic in the Web3 and cryptocurrency communities, those born after 1981.