Loyalty & Reward Programmes
March 27, 2023

NFT Loyalty Programmes: Missing Piece in the Customer Loyalty Puzzle?

NFT Loyalty Programs

The new functionalities and capabilities introduced by blockchain technology are defining a new era of loyalty programmes as companies include NFTs in their incentive programmes. Despite their widespread usage, however, you may be wondering how NFTs will impact your loyalty programmes in practice. How, exactly, can an NFT loyalty programme provide more to customers compared to traditional models?

We’ll explore the potential of using NFTs to drive engagement in loyalty programmes. But first, we must start by learning what NFTs are and how they function.



What is Blockchain Technology?

Blockchain is a distributed ledger technology that relies on a network of computers to validate each block/element/transaction conducted on a ledger (or list). Computers within the network verify the legitimacy of all transactions. To update the transaction’s value, all the computers involved in the transaction anonymously compute and review its various components.

This ensures that everything recorded on the blockchain is up-to-date (displaying the correct and current value); tamper-proof (no third-party access or alterations); and passes multiple verification checks, guaranteeing its authenticity.

What are NFTs and How Do They Work? 

NFTs (non-fungible tokens) are digital records that cannot be duplicated or replaced. These tokens are recorded in a blockchain (a digital ledger that keeps data encrypted). Each token is unique, and the blockchain keeps tabs on its value and transaction history in real time. 

NFTs have seen their importance increase over the years and continue to draw the attention of businesses looking to thrive in the digital space.

As digital tokens emerge as substantial investment opportunities, the NFT market has risen in popularity, reaching $22 billion in 2021.

Their popularity means more businesses and consumers are considering these digital assets as suitable rewards for brand loyalty. By rewarding loyalty with NFTs, businesses increase customer trust and participation; gain insights into customer preferences; and ultimately, increase revenue.

However, attention is shifting toward fostering better customer interaction and establishing stronger communities. It's still important to recognise and reward loyal customers, but in more creative ways than merely rewarding them with points.

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NFT Loyalty Programmes

Loyalty programmes are expected to experience a 10.5% CAGR between 2022 and 2030 as more businesses recognise the need for brand loyalty.

However, many are turning away from traditional reward schemes due to shifting consumer behaviours and the push towards digital transformation.

Using NFTs as incentives within loyalty programmes is gaining traction as digital rewards become more commonplace. Whether you're an online store or an omnichannel retailer, an NFT loyalty programme allows you to make meaningful connections with your tech-savvy customers. Other applications for NFT rewards will also emerge when the technology reaches a broader audience.

With blockchain technology, NFTs provide a means for companies to provide customers with incentives for staying loyal to their brand. This provides real value for customers by offering them exciting digital assets that can be exchanged on NFT markets. 



The NFT Loyalty Programme vs Traditional Models 

The traditional loyalty programme is an incentive structure that allows customers to earn rewards for their continued business. Customers can earn points towards free or discounted products based on how frequently they patronise your business.

NFT loyalty programmes build on the traditional model by giving rewards an air of exclusivity to enhance the customer’s experience with your brand. These programmes allow businesses to connect with their customers in a new way by capitalising on the popularity of digital collectibles, which appeal to the modern customer’s craving for one–of-a-kind rewards.

While conventional loyalty programmes are usually created with just the company's immediate future in mind, NFT loyalty programmes have the potential to benefit the company for the foreseeable future by increasing customer participation and engagement . Customers benefit from NFT loyalty programmes because they provide greater flexibility and facilitate the development of digital scarcity for tangible goods.


Why Add NFTs to Your Loyalty Programme?  

For many loyalty programmes, a lack of exciting and rewarding incentives often leads to a drop off in customer engagement.

KPMG discovered that 38% of respondents had issues with a loyalty scheme they were enrolled in.

Offering NFTs as rewards creates more opportunities for engaging digital interactions with your customers. NFTs' modular and customisable design makes them useful for a wide variety of purposes, such as establishing rightful product ownership, providing added incentive to make a purchase, limiting access to authorised users, and adding a fun element to customer interactions with a brand.

NFT's strict authentication standard and protection against fraudulent actions are additional benefits for loyalty programmes.

Due to their interoperability, NFTs can be traded to acquire access to special events or for other digital assets like artwork. One of the most interesting aspects of NFTs is their potential to greatly improve the value system for customers by making rewards more flexible, secure, and much easier to use.


What are the Benefits of Using NFTs in Loyalty Programmes?  

The rewards on offer play a critical role in boosting engagement and new signups for any digital loyalty programme. These are some benefits that businesses can expect if they include NFTs in their loyalty programmes.

Real-time data

Access to key data often makes the difference for successful loyalty programmes. NFT loyalty programmes use a blockchain-based system that instantly refreshes or updates rewards for customers, providing them with a better experience. 

Unique incentives

NFTs are intended to be rare and unique tokens as opposed to traditionally mass-produced rewards. Their uniqueness and rarity are what make them so valuable to the customers that receive them. 

Each NFT should be tailored to the needs of your business in a particular setting, such as a marketing campaign or sales season. This means customers can look forward to something special when it’s time to receive their rewards, setting your brand's loyalty programme apart from the competition and encouraging them to continue using your products.


NFTs and other blockchain-based technologies eliminate the need for third parties in the interaction between a loyalty programme’s vendors, partners, and customers. This interoperability means you can link different loyalty schemes into a central loyalty network.

With increased participation in loyalty programmes, customers have the opportunity to interact with one another, sharing experiences and contributing to your brand’s community. It also makes it easier for international businesses to implement unified loyalty strategies that reward customers in several markets.


NFTs don’t typically cost much to create, making them a cost-effective reward option. Algorithmically programmed collections both save costs and increase returns for the business. The true outlay of resources is in formulating and committing to a brand-aligned long-term reward strategy.

Appealing to a younger demographic

Adding NFTs to your loyalty strategy means attracting the attention of the younger generations who are more in tune with its benefits.

Over 57% of Generation Z say they can express themselves more freely in a virtual setting than in real life and 47% say they wouldn’t mind meeting new people in the Metaverse.

Also encouraging is the fact that Millennials are three times more likely to trade NFTs than members of Generation Z.

This shows that if your NFT loyalty programme is well designed, you can count on the participation of these tech-savvy customers.


Utility NFTs provide benefits to their holders that they would not have otherwise. These digital rewards provide holders with additional perks that stretch beyond the actual value of the reward itself. The reward could give the holder early access to new products or access to limited edition products.

These utility NFTs are value-laden offerings that can be expanded to give more value to your customers. They can improve customer loyalty programmes and provide customers with new ways to engage with your brand.

Better security

Due to the blockchain's immutable records and foolproof authentication, redeeming rewards is a smooth and error-free process. In addition, the NFT is destroyed when a reward is cashed in, ensuring that it won’t be reused.

Sustaining brand growth 

Long-term brand survival requires adapting to shifting consumer preferences and taking advantage of emerging technologies.

NFTs are an excellent example of emerging technologies that are gaining traction. In the third quarter of 2021, the Ethereum network recorded NFT trading by over 265,927 active users.

NFTs provide a new channel for communicating with and rewarding customers and forging partnerships with other businesses, contributing to building a devoted community for your brand in the long run.


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Examples of NFT Rewards and Loyalty Programmes

Burger King

Burger King is one of the recognisable brands that has joined the NFT bandwagon. In their loyalty scheme, each meal package contains a QR code that, when scanned, will provide the customer with one of three NFT gaming chips. A fourth NFT reward is automatically sent to subscribers once the set is complete.

Examples of the rewards on offer include a digital collectable, a year's supply of Whopper sandwiches, and brand merchandise. To further encourage engagement, Burger King is also experimenting with cryptocurrency rewards.


Starbucks and Polygon recently announced a partnership to supply blockchain technology for the Web3 experience, Starbucks Odyssey. Through this partnership, the company hopes to expand the reach of its popular loyalty rewards programme.

In previous programmes, customers collected "stars" for each purchase and then used them to trade in for freebies like drinks and baked goods. However, using Web3 will be a whole new experience. US Starbucks customers and partners (workers) now have the chance to earn and purchase digital collectables that unlock premium perks and exciting coffee-themed experiences.

Members will participate in "journeys" like interactive games or tackle entertaining tasks to increase their familiarity with coffee and the Starbucks brand. They obtain a "travel stamp" (digital collectable—NFT) for completing a voyage. The option to buy limited-edition travel stamps without using cryptocurrency is also available. With the use of these stamps, members earn more points and unlock exclusive rewards and experiences.

Taco Bell

Taco Bell has been holding auctions for a special edition Taco Bell NFT, dubbed NFTacoBells. In under 30 minutes, 25 artworks from NFT artists were snapped up. Each GIF sells for thousands of dollars, while originally being listed for only a dollar.

Token holders of this NFT will get a $500 Taco Bell e-gift card as a real prize. The programme is also a social action outlet for Taco Bell. The Taco Bell Foundation uses the sale's revenues to fund the Live Más Scholarship.

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How to Add NFTs to Your Loyalty Programmes 

Membership credentials

NFTs can serve as membership credentials for exclusive access to a brand's loyalty programme and its associated advantages, whether those benefits are tier-based or otherwise custom-tailored to the token's owner.

NFTs in airline loyalty programmes

NFTs work quite well when applied to a loyalty programme for an airline. Most airline loyalty programmes nowadays are frequent flyer programmes that reward flyers with reduced fares in exchange for a set number of miles flown with a particular carrier. Introducing NFTs will help in attracting more consumers and also open up previously inaccessible experiences like premium flight destinations.

Collaborating with other companies also allows airlines to provide passengers with unique rewards, such as early access to products and deals from their favourite brands. Frequent fliers are rewarded with even more exclusive NFTs and privileges as they rise through the membership tiers of a frequent flyer programme.

Profile pictures 

One of the most common applications of NFT at the moment is what amounts to a membership pass with a personalised illustration on the front that may be generated to display a blend of distinctive qualities depending on the real behaviour, transactions, and preferences of the cardholder. A few well-known examples are Reddit Avatars and Moonbirds.

Digital twin

Rewards can be tokenised by using their digital twin. The reward can be sent to the customer in digital form before the physical product is produced. This gives the customer a glimpse into the finished product before they receive the real thing.

Social initiatives

Providing NFT loyalty programmes that have a strong social element is yet another excellent method of engaging customers. One option is to sell your loyalty tokens at auction and donate proceeds to environmental causes. People respond positively when their preferred brands take a strong stance on social issues.


Over 70% of customers want brands to actively support social and environmental causes, and...

46% consider this a key factor behind their purchase decisions. You'll be contributing positively to the environment while also creating a devoted customer base.

Membership tokens

Each loyalty member can have a unique membership token (NFT) that undergoes constant development and upgrades. No two Membership Tokens will look the same since customer behaviours or information differ, and the Membership Token will adjust its design to reflect that.

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NFTs will Define the Future of Loyalty Programmes

As the metaverse continues to grow, the widespread use of NFT rewards by businesses shows that we should start preparing for it now. A new kind of brand loyalty is emerging as companies engage in digital platforms and assets to transform their relationships with customers.

We have only just scratched the surface of the possible applications for digital assets in the loyalty industry, and you can expect this trend to continue. 

Ultimately, NFT rewards and the digital experiences they deliver can foster engagement, brand loyalty, and growth. It opens up exciting avenues for companies to leave a lasting impression on their consumers, from the ownership of a piece of the company's history to limited-edition products. 



For more customer loyalty trends, read our latest blog: 

Customer Loyalty Trends: 10 Game-Changers to Prepare for in 2023

Until next time! 


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