Building loyalty with Web3

Web3 Rewards in Loyalty Programs: A Simple Overview for Marketers

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September 13, 2023

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Loyalty programs are evolving. Find out how Web3 rewards are transforming customer loyalty, offering unique, personalized incentives beyond run-of-the-mill discounts and points.

In 2023, your customer’s loyalty can no longer be taken for granted. 

If you look at the market from your customers’ perspective it’s easy to see why customers are so particular about the brands they do business with: The world is in an era of high economic uncertainty, with global economic growth slowed to 2.5 % in 2023 and interest rates reaching their highest level in 22 years

Of course, economic doom and gloom is unlikely to last forever. But what’s here to stay is the unprecedented access customers have to business alternatives. In the age of the internet, customers have the power to effortlessly compare brands and find the best available option.

Loyalty programs have emerged as a definitive way to capture and maintain customer interest by offering them rewards and benefits for continuing to do business with a brand. The only problem? The secret is out. At this point, loyalty programs are commonplace, with discounts and coupons being the most common, mundane form of reward. 

A Web3 loyalty program views customer loyalty from a whole different angle. Web3-powered loyalty programs offer rewards that customers can get genuinely excited about. In this post, we’ll explain what Web3 rewards are and give some examples of how they function in a Web3 loyalty program. (Psst, if you’re unsure what a Web3 loyalty program is, check out this short post: What is a Web3 Loyalty Program?)

What are Web3 rewards?

A Web3 reward uses the infrastructure built into Web3 to offer a new suite of loyalty program rewards. These rewards are typically non-financial, experiential, and tailored to your customer’s interests. 

  • Non-financial rewards - Rewards that don’t provide any direct monetary benefits. These typically include early access to products, preferential treatment, and insider information. 
  • Personalized - Rewards that are personalized to your customer’s likes and wants. They are usually based on a customer’s purchase history and/or personal data. (Did you know that 87% of Americans are willing to share data in exchange for more personalized and relevant rewards?)
  • Experiential - Events, exclusive access, and unique experiences are just some of the many possibilities available with experiential rewards. 

Web3 rewards that exist within a Web3 loyalty program are capable of greater degrees of nuance because they employ smart contracts that automatically distribute rewards based on certain conditions that a customer fulfills. These rewards are whatever your brand defines them to be. Web3 rewards don’t necessarily include digital items (e.g. ebooks, tutorials/guides, software, in-game items)  that exist within Web3 spaces. But Web3 can enable your rewards to be far more advanced than what’s possible with a traditional loyalty program.

Web3 rewards differ from old-school rewards because they operate on the blockchain. This means less heavy lifting for businesses as blockchain eliminates the need for extensive infrastructure like servers to handle, store, and distribute rewards. This approach, bolstered by smart contracts, enhances security and transparency in the reward system. Each customer's reward links to an NFT, serving as their digital membership card with your brand. In contrast, traditional loyalty programs, constrained by company infrastructure, tend to lean on simpler incentives like points and discounts.

Examples of Web3 rewards

In Web3 loyalty programs, there’s a much broader range of rewards options available. These rewards take advantage of the Web3 technologies to offer more personalized, engaging rewards to customers. 


Web3 rewards hinge on digital tokens, commonly known as NFTs. These tokens not only transform rewards into digital assets unique to each user but also symbolize individual ownership, unlocking extra perks like access to exclusive experiences or events. NFTs also double up as a verification tool to claim physical rewards. Picture an NFT as a special "access pass", akin to a gym membership or a Soho house card, granting holders particular benefits.

Community access

NFT-powered loyalty programs aren’t just about selling more stuff (or giving more stuff away). Their real strength lies in building communities. Brands often form exclusive communities for their most dedicated customers – brand advocates – to socialize and discuss their interests. This not only gives brands direct insights for testing new products and ideas but also allows them to gather invaluable feedback. 

Voting and participation

Beyond engaging your community, some Web3 loyalty programs offer members tokens to provide feedback and vote on community decisions. The weight of these tokens and the decisions they impact is for your brand to decide. But the final result is that your loyalty program members feel involved, validated, and immersed in your brand as they take part in co-creating and shaping the decisions of the community. 

Gamified elements

Want to make your loyalty program more than just about earning rewards? Many brands are adding achievements, badges, challenges, and even games to make the experience richer and more engaging. With Web3, smart contracts take the hassle out of rewards distribution; owning certain accolades means automatic reward allocation for members. So, your Web3 loyalty program becomes fun and efficient? Great!

Profit potential 

Tokenized rewards can also be bought and traded on decentralized exchanges. Members have a unique opportunity to earn money by selling or trading their tokens if its value depreciates to them over time. With this functionality, the demand, benefits, and adoption of the tokens is dramatically improved. Additionally, you have the unique opportunity to profit off of the third-party sales of your tokens. Token sales can incur royalty fees to the original minter, which, in this case, is your brand.

How customers earn Web3 rewards

In a Web3 loyalty program, rewards are earned as customers continue to engage with a brand on a deeper level. This is in opposition to the traditional rewards structure where some amount of points or benefits are earned from purchases with a business. Demonstrating engagement may take the form of participating in loyalty program activities, contributing to the community, or completing certain tasks. These activities focus on customers deepening their connection with a brand through memorable experiences. The activities that a customer performs then determines the types of personalized rewards that they receive. 

Nike's .SWOOSH Web3 loyalty program emphasizes community building to strengthen customer-brand connections. With .SWOOSH, members create, collect, and trade digital tokens in the form of Nike Virtual Creations. As they continue to engage with Nike, they are granted access to exclusive products, unique experiences, and special pre-orders. .SWOOSH also incorporates gamified elements like competing in community challenges for the perk of creating their own Nike Virtual Creation.

.SWOOSH focuses on creating an ecosystem of trading, creating, and discussing Nike products rather than focusing on financial rewards gained from buying Nike products. The success of this non-financial loyalty program is apparent as the Nike .SWOOSH NFT sneaker condition launched in May 2023 surpassed US$1 million in sales. 

Through .SWOOSH, it becomes clear: Web3 loyalty programs don't just reward purchases, they foster active and immersive brand relationships.

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