How Does Blockchain Supercharge Brand Loyalty?

December 20, 2022

If you’ve been reading our blog (or work in brand marketing), you already know that brands need to employ new methods to connect directly, and more meaningfully, with their consumers. Creating membership programs hosted on the blockchain is one hyper-efficient way to do this. But what makes this method so unique and worthwhile?

Blockchain technology is primed to revolutionize the way that brand memberships are both managed and experienced, leveraging a tamper-proof record of membership information and activity. With traditional, centralized systems, it can be difficult to verify the accuracy and completeness of membership data, and there is always a risk that information may be lost or manipulated. With blockchain, however, membership data is stored in a decentralized network of computers, making it nearly impossible for anyone to alter or delete the data without being detected. This ensures that membership information is always accurate and up-to-date, providing both the brand and the member with a universal source of truth, and unlocking:

  • Effortless Program Management;
  • Enhanced Reputation;
  • Deepened Insights; and
  • Secure Ownership.

Effortless Program Management

A key benefit of using blockchain for brand memberships is the ability to automate the fulfillment of membership benefits and rewards. With traditional systems, the process of granting and redeeming benefits is often manual, slow, and prone to errors. This can lead to frustration for members, who may have to wait for their benefits to be processed or may encounter difficulties when trying to redeem them. With blockchain, however, smart contracts can be used to automate the fulfillment of benefits, ensuring that members receive their rewards quickly and reliably. This can improve the overall experience of being a brand member, making it more convenient and rewarding for the customer.

The composable nature of digital assets further enables their seamless porting or reading across different applications. From a brand perspective, it opens up a multitude of third-party vendor opportunities, expanding the utility of the membership itself, all while avoiding cumbersome hurdles like data sharing and technology integration with another siloed ecosystem. Since the assets are composable, you can enable perks and benefits granted by your partners, directly to your members, much more easily. On the other hand, your partners can read the blockchain and grant your members benefits on behalf of the collaboration themselves. This ease of delivery does not otherwise exist with today’s technology.

Cross-industry partnerships like that of Delta and Starbucks can be replicated en masse, without requiring the enormous resources typically only available at blue-chip companies. Once brands are empowered with tools they’ve never had, they can accomplish things they’ve never thought possible. 

Further, identifying and activating these new and unique collaborations becomes considerably easier. When working with partners who also leverage blockchain, previously untapped groups or cross-sections of users can be identified based on what other programs they own or interests showcased, and can be targeted for special offers. Talk about an easy way to stay fresh and consistently relevant to new consumers!

Enhanced Reputation

By leveraging the decentralized and immutable nature of blockchain, brands can create secure, transparent, and efficient systems for maintaining membership data and delivering on program perks. Imagine the history of every perk, benefit, or experience ever issued through your program was captured in a public space: consumers are able to easily assess which companies are delivering on their promises and bringing true value, while quickly understanding who is underperforming. We affectionately call this the “accountability layer,” referring to the visible stream of activity that is pulled from on-chain transactions and displayed to consumers in real time.

Additionally, Members are able to connect and showcase their ownership outside of the MAGNETIQ platform (for example, on social media), further expanding the brand reach, and improving its reputation with every share.

Delivering on your program roadmap becomes a surefire way to gain a competitive edge, while inspiring further consumer loyalty. Prior to the blockchain, the ability to provide this level of transparency was not operationally feasible at scale. 

Deepened Insights

In addition to all of the technical advantages described above, using blockchain for brand memberships can also provide greater transparency and control for the consumer. Because blockchain is a decentralized and transparent technology, members can easily view and verify their own membership information and activity. This gives them greater confidence in the reliability and security of the membership process, and can help to reinforce the bond between the brand and the consumer.

Once trust and loyalty are established, consumers are in turn willing to share their valuable first-party data across engagements that go far beyond the point-of-sale, the episode, or the sports game. With access to robust, additional insights collected on inter-transaction engagement that goes beyond historically collected data points (including polls, surveys, cross-brand engagement, social activity, etc.), you are able to paint accurate, multi-dimensional pictures of your consumers’ complex lives.

Secure Ownership

Ownership of something increases its value in the owner’s eyes: something commonly known as the “endowment effect”. We tend to become extremely attracted to things in our possession. Prior to the advent of blockchain, there was no true ownership of assets on the internet. The innovation of verified ownership of goods on the web can’t be understated. 

But in addition to the psychological benefits of consumers immediately viewing their newly purchased brand asset as more valuable, this feature enables the same pool of participants to buy into, or sell out of, a membership program. Ultimately, this transferability optimizes your consumer base toward only the most active and engaged participants, improving your insights. Furthermore, it encourages buyers who might otherwise be on the fence to try something new, knowing they can sell to recoup what would otherwise have been “sunk costs” if they don’t end up deriving as much value from the program as they hoped.

So What Does it All Mean? 

The use of blockchain technology for brand memberships has the potential to greatly improve the efficiency, reliability, and transparency of the membership process. By leveraging the unique capabilities of blockchain, brands can create more rewarding experiences for their members, while also gaining a more accurate and reliable source of data and insights. This can help to drive customer engagement and loyalty, and can help brands to more effectively manage and grow their membership programs.

MAGNETIQ is ushering in a new era of consumer marketing through the creation of scalable, commerce-based communities. Using our engagement tooling, brands can easily create tailored programs to personalize the consumer experience and increase LTV, while gathering peerless insights and analytics. For more information, follow us on our LinkedIn and Twitter or contact us at