From Loyalty Points to Virtual Currencies: Expanding Loyalty Schemes for Mobile Platforms

Research output: Chapter in Book/Report/Conference proceedingConference paper

Abstract

Since the first loyalty program was introduced in the 1980s, technological innovation has changed the
possibilities for such programs considerably. One significant change is the emergence of mobile and
online platforms that started to deploy loyalty schemes aiming at both sides of the market, namely
customers and third parties such as retailers or merchants. One consequence is the expansion of the
roles of loyalty measures to the point of introducing a Virtual Currency. More than plain loyalty
points, Virtual Currency is a tool to support multiple usage options granted to different types of users
and utilizations.
Based on the analysis of four case studies, this paper examines the business conditions and
consequences of the implementation of a Virtual Currency by mobile and online platforms. One
consistent element throughout all examples is the aspect of rewarding customers for desired user
actions. Beyond this, the objectives of implementing a Virtual Currency go from strengthening loyalty
to opening new revenue streams.
The paper contributes to gain insights of how loyalty measures and rewarding schemes can be
transformed and expanded to Virtual currency programs and how respective strategies can impact
platforms' business models and hence performance in the market.
Original languageEnglish
Title of host publication12th International Conference on Mobile Business (ICMB 2013). Paper 9
Number of pages12
Publication statusPublished - 2013
Event 12th International Conference on Mobile Business - Berlin, Germany
Duration: 10 Jun 201313 Jun 2013

Conference

Conference 12th International Conference on Mobile Business
Abbreviated titleICMB 2013
CountryGermany
CityBerlin
Period10/06/1313/06/13

Keywords

  • Loyalty schemes
  • virtual currency
  • business models
  • two-sided markets

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