Crypto-Craze: Cryptocurrency Shaping Retail’s Future

Crypto-Craze: Cryptocurrency Shaping Retail’s Future

Mention the word “bitcoin” in conversation and you will witness someone geek out over cryptocurrency. Or, you’ll be the victim of some intense eye rolls; most likely it will be the latter. In short, many people are sick of hearing nonstop stories, headlines and more in its regard. But, new developments with blockchain are causing a stir, meaning it will penetrate news and conversations possibly until the bitter end.

Blockchain, the technology that underpins cryptocurrency, is fast disrupting almost every industry, changing and expanding the traditional way of business. In fact, more and more companies are incorporating the technology into their organizational model in a bid to drive change. Firms nowadays are either rebranding with the blockchain or adding a digital currency of their own in an effort to reap loads of benefits.

Ahead of the Curve

Japanese e-commerce and internet giant, Rakuten has become one of the latest established firms to pivot to digital currency with an eye on cashing in on the crypto craze. According to TechCrunch, Rakuten plans to “roll its $9B loyalty program into a new blockchain-based cryptocurrency” known as Rakuten Coin. The organization’s crypto initiative was announced at the 2018 Mobile World Congress in Barcelona by company CEO, Hiroshi Mikitani.

Rakuten Coin is intended to serve as a blockchain-powered digital coin system for the Japan-based company’s Super Points loyalty rewards program. With the program, customers earn points by trading on Rakuten and then redeem the points for other Rakuten products and services through various means. More than 1 trillion Super Points have been awarded over the last fifteen years. This adds up to $9.1 billion in monetary value, according to TechCrunch.

In a similar report, SJ Sourcing Journal said that Rakuten adopted cryptocurrency because the company sees it as a way of leveraging Bitnet, a Bitcoin wallet start-up, which they acquired in 2016. For Rakuten, cryptocurrency rewards can revolutionize retail by facilitating cross-border shopping. This is because Rakuten Coin will help make for a much easier integration across the world, thereby ensuring that clients spend money on the company’s numerous services.

Rakuten has overseas holdings in France (PriceMinister) and the U.S (Ebates), among others. However, not all of the holdings offer or accept Super Points. This has limited the company’s profitability for far too long. As a result, Rakuten believes that the introduction of the Rakuten Coin will encourage customers to use the organization’s ever-growing global market in a way that delivers results.

A Unifying Currency

In addition, the digital coin is considered as having the capacity to persuade users to consider other products offered by Rakuten. These include games, travel deals, as well as social media platforms, mobile phone data, etc. which the company plans to introduce in future. Many believe that Rakuten Coin will remove several obstacles from the online marketplace, some of which include high conversion rates, exorbitant customs duties, etc.

Mikitani further revealed the company’s intention behind the coin saying “Basically, our concept is to recreate the network of retailers and merchants.” “We do not want to disconnect [the products from clients] but function as a catalyst. That is our philosophy, how to empower society not just provide more convenience,” he continued.

With loyalty programs growing across not just retail but also financial services, travel, as well as other economic sectors, and coupled with the increased adoption of digital coins among businesses, it won’t be long before blockchain and cryptocurrency transform customer loyalty schemes beyond retail. Perhaps the most intriguing idea is one in which there is a digital currency that knows no bounds. This would transform not only the global marketplace, but travel and more. Now that’s a reason to get people talking.

Author:  Christine Duff

Christine wants to live in a world filled with cutting edge fashion, beautiful words and and an endless supply of leather jackets and boots. A product development grad of FIDM, she was the Editor-in-Chief of MODE Magazine where she reignited her love of storytelling. She has diverse experience within the industry with trend research, art direction and styling editorial spreads. She gained her most notable experience working in Los Angeles at the satellite operation for GQ and Vogue Thailand. Christine is passionate about social science and the role it plays in the consumer goods industry and apparel in particular.

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