The Next Big wave in the Food Business: Tokenization
Eating outside has not only become a trend and an integral part of the culture but also a social currency. Eating in better restaurants and eating tastier and the better-looking food is a means to increase one’s status quo. Brands like Starbucks have capitalized on this building almost a cult-like following and loyalty with its customers.
The consumption of outside food has increased considerably, you would think that opening a restaurant the restaurant business is still one of the most brutal businesses with over 90% of failing within the first five years. But the ones that manage to create a loyal base of customers seem to do really well.
Loyalty Programs in Restaurants
Customer loyalty programs have worked out really well for the bigger restaurant chains. For instance, Starbucks is one of the most well-known success stories for loyalty programs. Launched in 2010, the customers ended up not only visiting Starbucks more frequently but also increased their ticket size.
The company ended up with Billions of Dollars in customer funds and Millions of users downloading and using its payment App. Today Starbucks has more users using its payment App than many Payment companies.
Why do you ask?
Because it is in human nature to do so. We are wired to chase rewards since we are children, a mother promises a chocolate reward for a child to complete his homework, a teacher promises to give the student with a star if he outperformed in his assignment. We crave for recognition and reward points even if they mean nothing and may cost us more money.
Restaurant chains like Subway and McDonalds have been able to take advantage of this, but what about the rest?
70% of the restaurants don’t have any loyalty programs and the ones that do have a hard time running and maintaining it. This is because small restaurants do not have the resources to create a loyalty program and have their own payment channels.
So where does Tokenisation fit it?
Why create tokens on the Blockchain? One Word: Incentives
The beauty of Blockchain Technology is that it allows you to program the rules in the code which every rational actor is bound to follow for their own benefit. This is a perfect fit for loyalty programs as you can achieve economies of scale by creating a single platform where the participants of the network don’t have to trust each other.
To make it feasible for small restaurants to create effective loyalty programs and use the tokenization revolution to their advantage there has to be a platform which makes this easy for everyone. The customer should not download a hundred Apps to keep track and the restaurant shouldn’t end up spending the majority of their resources developing these loyalty programs and payment apps.
Resto is the first company in this space that is creating a such a platform with a smartphone App with a built-in Digital Wallet. This will allow any restaurant to join the network and create a loyalty program for their customers. The platform also gives them access to the customer database and create marketing campaigns around it.
Instead of downloading an app for every restaurant the like, the customer can download just one app to access multiple loyalty programs from different restaurants and use a single payment network for all using the Resto token around the world.
Incentives are powerful, wonders happen to businesses when they realize the full potential of incentives structures and human behavior. With the ability to create tokens on the Blockchain and create their own incentive structure many businesses are likely to rise by embracing this Technology.
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