Virtually every blockchain-based startup has plans to offer reward tokens to customers in exchange for their loyalty.
To date, those plans are largely in the white paper or beta phase. On the other hand, a Morristown, New Jersey-based startup named Sweet has been deploying this vision since January. The company says it is the “first tokenized loyalty platform to actually hit the market” in support of brands.
Sweet allows brands to promote their wares by granting reward tokens — appropriately called Sugar — to fans, in exchange for liking, sharing, watching a video, posting a comment or otherwise engaging with the brand. The brand sets the value in dollars for each action, but the fans see that value as Sugar tokens.
Currently, founder and CEO Tom Mizzone told me, Sweet has about 50,000 fans enrolled on the platform and expects about 150,000 by year’s end. A couple of dozen brands are on the platform, including the band Black Eyed Peas and performer Jorge Blanco. Sweet says another 30 brands are currently onboarding, and over 80 are in the pipeline.
Sweet-related activities take place in the brand’s desktop or mobile website, where the Sweet app is embedded for tracking actions, in the Sweet Marketplace for redemptions of Sugar tokens or in an upcoming Sweet mobile app.
The company reports that fans have earned 2.5 million tokens globally. Fans automatically get wallets when they sign up, and a wallet automatically receives Sugar tokens when a fan takes specified actions.
About 1.5 million tokens have been redeemed to date, for rewards and experiences that include shoutouts from brands on social media, exclusive content, meetups with celebrities, skating helmets, the opportunity to pitch a new tech idea to Black Eyed Peas’ will.i.am or other goodies.
Just this morning, Mizzone said, “someone cashed in a million tokens to get a cameo in the next Black Eyed Peas video.”
Large brands pay nothing to participate on Sweet, but brands with fewer than 100,000 followers pay a monthly access fee. All brands can also sell their own products, services or experiences in the platform’s Marketplace, with Sweet taking a 20 percent cut and the brands keeping the rest.
Although other platforms pitching reward tokens utilize blockchain’s cryptocurrency and smart contracts, Mizzone said Sweet is a “hybrid model.”
The company developed a non-blockchain “internal ledger” of its own to manage a fixed supply of 20 billion Sugar tokens, he said, and the next phase is to connect with an external public blockchain by the end of this year or the beginning of 2019. When connected, brands and fans will be able to move their tokens into their own wallets and employ them in external exchanges, markets or third-party applications.
Mizzone said his company identified the top 100 Sugar earners and found that the Sweet platform drove a 15x increase for social engagement with the same brands, compared to the fans’ pre-Sweet days.
I asked Mizzone if paying fans for doing fan stuff was sort of like paying children to do their homework, in that it changes an organic and voluntary activity into a job. Was a fan being paid to like a brand’s post worth as much to a marketer as a fan voluntarily liking it?
He said that each fan has “been doing thousands of dollars of work for brands,” and now they’re being compensated with what amounts to an extended loyalty program.