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How blockchain can revolutionize Customer Loyalty Programs


(I like to use the Triceratops against the T-Rex as an example of how the strong, yet kind of the earth can defeat the predators without becoming predatory themselves.)

Private versus Public Blockchain


First, let’s briefly touch on the generic rationale for “private” blockchains. There are plenty of valid use-cases for a private or permission blockchain. To some degree, even “public” blockchains are private. Currently, the barriers to entry to public blockchain being technical savvy or even KYC rules. If we create two open blockchains and assign ½ the world to use blockchain A, and the other ½ to use blockchain B, we essentially have two private blockchains. Suffice to conclude that there are use-cases that lend themselves to a variety of different blockchain types. Private blockchains will likely serve an important role in the future of digital collaboration.

Governance is Ky


As we already see, there can and will be manifestations of many different types of blockchain...All with varying levels of privacy. The discussion shouldn’t be public blockchain vs. private blockchain. The topic that matters is “governance”. The mechanism by which the rules on the blockchain are maintained and enforced. The governance topic has been the bane of human beings forever. We still are extremely inefficiently governed IRL How can we hope to create autonomous governance mechanisms when we can’t even govern ourselves effectively?


The problem of governance increases exponentially with scale. Therefore, if we keep our blockchain purpose narrowly focused, we can more easily create a governance model that works. A group of collaborative participants are more easily “governed” than a random population of participants. To manage our private blockchain we must only provide governance that is in the interests of this collaborative group. We can focus the governance (or rules) specifically on the (virtuous) goals and objectives of the group. This makes our governance task MUCH easier. The technology underpinning the private blockchain can have many of the valuable characteristics of a public blockchain. In addition, this blockchain can remain private and communicate with public blockchains when desirable.


Characteristics of optimal blockchain ecosystems

Metcalfe’s network-effects dictate that the larger the participant base of an ecosystem, the better. The “governance-effect” (as I will call it here) is that the more narrowly focused the objectives of the participants, the better. So, if we have a large group/network with very closely aligned objectives, we have the ingredients for a game-changing blockchain. We can create a simple governance model where the collaborators optimally share in the benefits of blockchain-driven efficiencies.


The more efficient the distribution of benefits, the more successful the ecosystem.


This is where current Customer Loyalty Programs are vulnerable. These programs are not governed appropriately. The interests of the broad participant base are not served optimally. The interests of the owner of the loyalty program are significantly over-weighted. If we align the objectives of the program with the objectives of the participants, we will have a much better program for everyone. We are seeing the landscape changing. We are seeing the technology changing. There are so many ecosystems that are ripe for empowerment. There are so many ecosystem that are ripe for replacement. Your current ecosystem could be a victim. Your new ecosystem might be a game-changer.



Own your Ecosystem


By embracing a blockchain-based ecosystem early, you can start to optimize your business processes and objectives around this powerful technology. The use-case for blockchain-based Loyalty Programs is well documented. Here are a few non-customer-loyalty types of ecosystems benefiting from a private blockchain due to the participants need to collaborate with a common purpose:


  • A manufacturer with a network of suppliers

  • An employer with a staff of employees

  • A farmers-market with a collections of farmers

  • A professional-association with a collection of trades-people

  • A conglomerate with a portfolio of complementary corporations

  • A loyalty program with a consortium of cooperative merchant partners

  • A bike manufacturer with lifestyle aligned participants

  • A public entity extending a purpose-aligned collaboration with the private sector

  • <Insert YOUR use-case or ecosystem here>


Pravici TLP 2.0 Overview:

  • Pravici TLP is a blockchain-based, consortium-building toolkit.

  • Pravici TLP is a SaaS solution available in single or multi-cloud configuration

  • Pravici TLP is available as white-label platform to support your Program.

  • Pravici TLP is Web 3 and NFT enabled


With your ideas, and some help from Pravici TLP 2.0, you can create the next-generation ecosystem or loyalty program that will be a game-changer for you, and possibly the world.

Have an existing Ecosystem or Loyalty Program that might benefit from Blockchain? Thinking of launching a brand new Program? No matter how small, or how large is your ecosystem, Pravici TLP has a subscription that is right for you.

Visit us at Pravici.com

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