Costco's Checkout Challenge Presents an Opportunity for Web3

Speaker 1: 0:00

Welcome to Marketing Meets Web 3, a podcast that helps marketers navigate the news trends, opportunities and insights surrounding Web 3. Today's conversation is for information purposes only and does not constitute legal or investment advice. Hello Nick, how are you doing? Hey?

Speaker 2: 0:20

Alberto, I'm doing well. How are you? I'm doing fine. I am looking at what's happening in the membership arena and let me tell you we're coming strong today. Are you ready? Give it to me, yes. So there is this company you probably know it which is called Costco. They sell a lot of things. They don't sell pageant penguins, sadly, but they do sell our pageants.

Speaker 3: 0:51

I've never heard of this brand. Are they big yeah?

Speaker 2: 0:54

they're big. They're big, they sell out of things, they sell out of things and, of course, as any company that prouds itself of being so, they have a membership program. This membership program is causing some problems, some problems that they would like to tackle, and they have brought some solutions to solve this problem. The problem is that they see some people sharing their membership and taking advantage, of course, of the benefits that said membership provides. Of course, to eliminate this issue, they have brought some solutions that we will be discussing shortly. But, yes, I want to hear your first take on this probably known company and their membership program.

Speaker 3: 1:52

Yeah. So I of course know who Costco is. I used to live across the street from a Costco and so we'd go there once in a while. I don't go there too much, so I don't have kids and it's just my wife and I, and so Costco if you don't know about Costco, it's this huge. Their whole thing is bulk shopping, so people go there and they'll buy supplies for the month or whatnot. I don't shop that way most of the time, so it's only occasionally that I end up at a Costco. But when I have ended up at a Costco I've always been puzzled by the whole process around the membership card, to be honest.

Speaker 3: 2:29

And it's interesting that this is an issue for them, because to me it's always seemed like a loophole, like very easy to game, probably prone to a lot of fraud. And you know, I know people that have borrowed somebody's Costco membership card, because it's not something that you're going to use every day and sometimes people just want to get a quick deal on a single item especially. You know, feel like me and you don't buy and bulk a lot. So it's interesting to hear that they're trying to tackle this. The approach that they're taking, I guess, tell me a little bit more, because it sounds pretty manual, or shall we say web two oriented.

Speaker 2: 3:08

Yes and well, by the way you described the problem and by the way you described the kind of people that take advantage of this membership program loophole. I mean, you may think totally that you are one of those they take advantage of this, but you don't have to confess here.

Speaker 3: 3:25

Basically, yeah, I will neither confirm nor deny that allegations are.

Speaker 2: 3:30

Yeah, so what Costco has started doing to crack down, I think, on this, on this problem that they see, is they have started to ask shoppers to present a photo identification along with their physical membership card at checkout when they are paying for their bulky groceries. So, yeah, that's, that's basically the solution, because I don't want them that's from Costco, because I don't want them to come here and take advantage of the membership card, for they actually saw within a site is but so the membership costs 60 bucks, $60 annually. So, yeah, this is like a prime, it's like a prime subscription. Yes, so, because I don't want you to take advantage of the benefits that that come from this, from this membership card, then I want to make sure that you are the actual owner of this card. So you need to show me some kind of ID along with your membership card, which to me it feels like, yeah, it feels like 2000s completely and we're 2024 already. It feels old.

Speaker 3: 4:37

Yeah, it definitely feels old and I think it comes with an additional problem. So there's a human verifying that photo identification and if you're the kind of person who's trying to game the system and you're just trying to buy that 150 pack of Coca-Cola, what's to stop you from pushing back on the clerk and saying, no, that really is me, I just had a different hairstyle. And now Costco is basically asking its employees, its workforce, who didn't sign up to be any sort of security guard or bouncer. It's asking every employee to basically take on this job of verifying identity, which seems like it could just turn into a problematic situation. We know that people throw fits, they get crazy, they escalate.

Speaker 3: 5:31

We've all seen the airline videos. When somebody has a bad day, I can just imagine somebody freaking out at the Costco and yelling at a clerk about their ID not matching their membership, and so I agree it's low tech. I also think it's problematic and probably going to have some unintended second order effects that might negatively impact Costco's business. So is there a Web 3 opportunity here? I think that's your question, right.

Speaker 2: 6:03

Yeah, that was my next question for you. But yes, because to me, yeah, you put it perfectly. I was looking for this word before bouncer. Yeah, they've made clerics be bouncer. Basically, the whole process makes me think of when I was 16 and trying to get into pubs or clubs. It's definitely like that. But yeah, so how Web 3 could easily fix this thing, because really I think we are in a position where this is totally fixable.

Speaker 3: 6:37

Yeah, absolutely so. One of the superpowers of Web 3 is the idea of user owned assets, and so when you think about a membership card, it really is an asset of the owner, right? It's connected to a service that they pay for and benefits they receive, and so that card becomes their unlock for those perks and benefits. And so it is. It's an asset and it's something that the user's already paid for. They should have ownership over that, and in a low tech world, we ask them to show the card and show their ID and we play this matching game and do know your customer bouncer type activity on the fly.

Speaker 3: 7:16

In a Web 3 world, we know that assets are already owned. They're inherently owned by their users. That's a natural effect of blockchain tokens, and so if a membership card is a token, an NFT under the covers, and a user doesn't need to know this right, they can sign up with an email address or an SMS number and they don't know they're holding an NFT, but it's secured by blockchain technology. And so now they have this membership pass on their device, a device that it's very unlikely that they're going to hand to a friend for hours as the friend goes off and shops at Costco. That's just. It's one thing to hand somebody a membership card, it's another thing to give them your smartphone. I just don't see that being a huge opportunity for fraud. And so if that membership card now is secured and I can show it on my phone and it's a Web 3 secured asset, it takes a lot of that burden off of the process of confirming somebody's identity and certainly takes away this ask of Costco employees to become, like you said, bouncers.

Speaker 2: 8:24

Yeah, so I wanted to highlight this thing with Costco, because we've spoken multiple times here of how companies are making use of Web 3 to improve loyalty reward programs, to improve membership.

Speaker 2: 8:40

But I mean here, even if you are not adding anything to this, even if you are just only a membership pass, if you are just using a membership pass on Web 3 or on the blockchain to avoid having to ask your employees to be reviewing photo IDs from your clients, even if you are only using that, that, I mean it's already a solution to a big problem, a big problem from a big company that is traded in the US Stock Exchange and that has been growing, I think in the day IEPO in 1985.

Speaker 2: 9:18

So it's an old company, big one, and they have this problem, this perfectly implementable solution. That's a side of any other benefit that could be provided by having a Web3 membership. But, yeah, that's why I wanted to highlight this one, because sometimes we cover very fanciful things, sometimes fanciful things that are not really very down to earth. In some cases we are talking about stuff that has a lot of potential but maybe today doesn't provide a very tangible solution, but this is very clearly a solution to a problem that they're trying to tackle in the wrong way or in a way that could be bringing so many other problems to the environment they're trying to solve. So, yeah, I think this is the end.

Speaker 3: 10:15

Yeah, and I think there's one thing that I want to dip into as well on the non-transferable side. So part of the membership rules with the Costco membership are that you can't transfer the membership to another person. You can have an extra membership card but they're non-transferable. So I can't give it to somebody that I haven't designated as that extra member. And you might look at a Web3 solution and say, well, what's to keep the person from transferring away their membership pass? They could just send it from one wallet to another. But again, web3, I think, has a really strong response to this, which is assets. Nfts in the Web3 world can be non-transferable. These are sometimes called soulbound NFTs but, silly terminology aside, it means that one user can't send an NFT to another user. It becomes attached to that single wallet address that the person can't give it to their cousin or their cousin's friend. It's permanently attached to their identity. So I think that's actually a huge side benefit of adopting a Web3 solution here.

Speaker 2: 11:18

Yeah, and I think, just to close with this, I think it's important that you raise that point because somebody may be hearing this and thinking of ways to game this solution. But Web3 is in a position now that it's already been on for a while and we've covered here big companies jumping on this solution, like Visa I think we covered that one in the previous episode and so the solution, or the technology, now is in a place where many of those easy ways to game the technology have already been tackled and have already been solved, like in this case. We're just saying with the soulbound tokens. It could be other ways, but, yeah, so this easy game of the system has already been thought of and has already been solved. So, yeah, it's a good point they're making Because, yeah, it is in a position now where it can really solve this without bringing any other issues that haven't been solved already. Yeah, absolutely, what do we have next? Yeah, yeah, yeah, because that was my intro actually to the next one, because this may be why more brands will be using Web3 to capture market share in 2024.

Speaker 2: 12:40

At least according to this opinion piece from a writer who you may think comes from marketing or is in somewhat related to marketing roles, but what I found interesting is that this piece was written by a person called Frank Wang, who is actually the director of platform sales at BitGo, and BitGo it's not a marketing company, it's an institutional digital asset financial services company, so it's a person very much involved with tokens, web3, crypto, however you want to call it, but who comes from the finance industry and it's looking at the market and thinking well, everything I'm seeing is making me think that brands will be using Web3 to capture market share in 2024.

Speaker 2: 13:42

This, of course, the fact that he comes from this industry, doesn't make him a person who is super well prepared to speak of this, so this doesn't qualify him in a better way than some other, but I find it interesting that, from his position, he's looking at this and making this assessment. So yeah, in this piece he's talking about how consumer retail spending is rising and the expected beneficiary of this type of war between brands for consumer dollars could be Web3, and specifically this year, 2024. He says we're likely to see growing numbers of brands and companies leveraging Web3 to strengthen the bond between their brand and customers. And I want to talk a bit about this piece because it's interesting that he's looking at ways companies could be using Web3. And everything he talks about throughout the piece is basically memberships. So, yeah, this seems to be like the very, very low hanging fruit for companies using Web3 for memberships, which I guess, well, it's kind of related to the previous piece of news that we covered when we talked about Costco. But yeah, what do you think?

Speaker 3: 15:05

Yeah.

Speaker 3: 15:05

So I took a look at the piece and the same thought occurred to me. I'm like, ok, this is a person who's completely outside of the marketing or the loyalty realm and they're opining on the potential of Web3 to bring value to loyalty programs. I actually think that's interesting, less so from the perspective of, like you know, this person might not be a subject matter expert, but more so from the perspective of this is a person who deeply understands the benefits of Web3 and understands the value as a consumer and is able to articulate a path here by which brands can basically use Web3 to reinvigorate their loyalty programs through ideas like membership. And so you know he talks about some key ideas throughout the piece. One of those big ideas is that ownership is this new superpower of Web3. And much like we talked about ownership related to the Costco situation, which is kind of preventing a negative effect on the business you know they're trying to prevent things from being shared. We can also turn this around and say, because an asset is owned by the user, it allows them to do whatever they want with that asset.

Speaker 3: 16:21

One of the big problems from the user perspective with loyalty programs are they create this uncomfortable lock-in. Now it's a balance because as a reward program operator there's a desire to have a retention effect on your customer base, right, you want to make sure that you're sticky with them, that they're choosing you and they're coming back. At the same time, if the customer can't get the value that they think they've earned, that starts to get negative really quick. And so in programs where you've earned a bunch of points and you don't actually receive the value, that's a big negative moment for the customer. You know, I personally had one of these at the end of the last year, a 23. I had been accruing a bunch of points on my Southwest card, which my wife and I fly Southwest pretty much exclusively domestically because of the points program, and I was literally 800 points away from getting to the next tier and it was, you know, 70,000 points. So this is significant and because I didn't make a cutoff date that was buried in fine print by like three days with the credit card billing cycle, they didn't give me the last 800 points and I did not make that status, you know. So that was 70,000 points. That did absolutely nothing for me and honestly, it disincentivized me as a customer and I find myself being less loyal to Southwest now because I'm like well, you know, I tried to get there and it just didn't really work for me and I wasn't able to realize any value, even though I gave them the value of my loyalty throughout the year.

Speaker 3: 17:54

And so this is this idea that a customer owns their assets and, in this case, that their assets could be their loyalty status or their tiers or their points, their, the value that they've earned as a loyal customer becomes something that they can own and they can decide what to do with. You know, they can sell this, they can transfer it, they can gift it to somebody. I think this is opening a new, a new window of opportunity for loyalty program operators to rethink what it means to allow people to come and go as they please. You know, as I said a few minutes ago, I think there's been hesitation to allow people out of programs because that kind of works against the goals of loyalty. But what I don't think people are quite grasping yet is that this is actually a moment to double the efficiency of your advertising dollars, and I'll tell you what I mean by that.

Speaker 3: 18:46

So when you go to acquire a loyalty program member, you're spending money to acquire that person, whether it's the onboarding cost or you have to promote the program, you're spending that money.

Speaker 3: 18:56

So you spend, say, $50 to bring somebody into the program.

Speaker 3: 19:00

They then earn rewards and hopefully you're generating higher order values and repeat purchases, and so that's a benefit to the business.

Speaker 3: 19:08

But at some point, if the customer doesn't use those points and they get mad and they leave, now you've lost the customer, you've lost the benefit to the business, you've lost that cost that you've invested in acquiring that customer. However, if that customer can transfer their rewards to another person who's not a customer of the brand and let's say it's a gift that they want to transfer I want to gift you these points so you can fly Southwest. Or I want to sell them to somebody because I don't have time to use these and I'm going to give that person a deal, but they're going to become a customer of Southwest. Now we've taken the acquisition spend for the member the amount that we've spent to reward the member for however long they were, and we've basically recycled those advertising and marketing dollars into our acquisition cycle. And so, if we really play the long game with loyalty here, allowing people to use Web 3 to transfer their loyalty assets is a way for, I think, marketing operations to drastically improve their loyalty budget efficiency.

Speaker 2: 20:13

We'll be right back after a word from our sponsor.

Speaker 1: 20:17

This podcast is brought to you by Step 3, an engagement marketing platform that helps brands build deeper customer relationships. Step 3 makes it easy to design custom branded membership programs that include rewards like exclusive content, VIP event passes, merchandise discounts and more, Unlock new revenue streams. It enhance customer lifetime value with Step 3's easy to use, no code tools. Go to step3.io to learn more.

Speaker 2: 20:53

To me what you were describing. There were a couple of things that I love, which is, first, private property that's very nice to have. And the second thing is fungibility and what you're saying there is like in the case that you were commenting on the fact that you were not loyal enough to this airline company, so you weren't loyal enough and you couldn't then benefit from the loyalty that you had accrued because it wasn't enough. If you had been more loyal, then maybe, but that means that you couldn't basically enjoy any of the benefit of your loyalty, even if the loyalty wasn't enough for you to qualify as a loyal customer. But yes, if you were to make those rewards more fungible, meaning, yeah, if you could, as the writers in the piece, if you could sell those, if you could rent those.

Speaker 2: 21:52

I'm not saying that this has to be the case, like, for instance, in Costco. They're saying that these are not transferable and they are, of course, legitimized to do whatever they want. But the point is that we could start to see some competition here and some variability in many of these membership programs, because some companies will look at this and say, well, I can provide rewards to my members or I could just let my members find the reward in the points that are given to them. If I am giving you points and with those points you don't make the cut, but then you have the vulnerability of the points to exchange them for something else, well then you have already found your reward, even if it wasn't one that the company was providing.

Speaker 2: 22:44

So I think the fungibility makes the value of those points and, of course, the value of the membership increase and we could start to see some competition in between membership programs, some that allow for more flexibility, some that allow for less. That will, of course, have to compensate for this lack of flexibility and fungibility. So, yeah, I don't know. I think it's great to see this because it opens the door to many different possibilities that could help the customer at the end of the day, because competition between companies means that companies will be competing to offer a better service and the end user of those benefits, or the end, yeah, receiver of those benefits is the customer. So, yeah, it all helps, it all works, it all works for the customer.

Speaker 1: 23:43

So, perfect and.

Speaker 3: 23:44

I mean, before we leave this topic. You know, I think the important thing that this underscores is the impact of the customer experience. This is not just about trading loyalty points away. It's not about somebody trying to make money and their unspent points. It's not about, you know, the business worried that they're gonna lose a customer because they can't transfer their points away. It's about giving marketers and businesses a new path to creating a better customer relationship and a deeper customer experience.

Speaker 3: 24:17

So in my example, if I could have taken those points and maybe I couldn't, you know, obtain the tier, but maybe that entitled me I was close enough to be able to transfer those away, to fly my nephew in for the weekend and let's say that we had a great time together. And that was all because a reward program facilitated me being able to capture the value that I had already earned and use that in a way that now turns what for me is kind of a negative sentiment towards Southwest Points Program and makes me a loyal customer. That now, when I think about Southwest, I have an emotional connection to them, thinking about wow, they enabled this thing to happen that I really wasn't even expecting, but it was a bonus, it was a cherry on top. So at the end of the day, it's all about a great customer experience.

Speaker 2: 25:07

Yeah, and opening the door for, yeah, better competition and better rewards that the users may be able to find for themselves. And of opening doors is what we're gonna be speaking next, because we need to talk about mango opening the door to enter into the world of Roblox, which we have discussed in the past, as one of the companies that is creating something, some kind of metaverse, let's say, but one definitely with a lot of traction, I think, probably because they already had a very nice, well-worked out platform and, yeah, what they're doing is just expanding the value or the possibilities within this platform and taking advantage of this. The last company, I think taking advantage of this is Mango. Mango, if you don't know, it is a fashion retailer from Spain. It's pretty big, I think. They sell worldwide, but, yeah, they're originally from Spain.

Speaker 2: 26:06

There's also H&M in Roblox, which originated in Sweden. There is Puma, there is American Eagle, this, probably, this one, probably, you know. But yeah, the point is that there is a lot of companies, in this case, brands from fashion, from the fashion industry, making their way to Roblox and this seems to be happening, I think, week in and week out. So every other week we will find a new company getting into it and it's getting interesting. What do you think?

Speaker 3: 26:43

Yeah, I agree, I mean everybody's. It seems like every brand is headed towards Roblox these days. I'm just I constantly see LinkedIn posts and updates that brand activations happening in Roblox. And I agree with you, I think it's because Roblox had a very robust platform before you know any of this conversation about metaverse or Web 3 started, and so they had a really great foundation to enable these types of experiences. You know some of the Web 3 upstarts that are going after the metaverse angle. I think they have a very sort of nascent experience that, honestly, when you're inside of it, it doesn't really it doesn't really feel engaging, whereas Roblox, you know they have the builder economy, they have, you know, influencer and celebrity interactions. They've just got a great platform in place.

Speaker 3: 27:33

I think it's pretty interesting that we're starting to see this overlap between items and objects in the metaverse and brands, and I think it's it's always been part of my perspective on Web 3 that as this technology matures and as this technology starts to permeate other areas of our life, I've always felt that it's inevitable that we'll end up in a world where we go into these different experiences with our digital things, which, under the covers, are NFTs, hopefully because we own them and when they're portable, we can take them and they're interoperable. But these things then become part of our identity in whatever environment or metaverse we're interacting in. And so now you know, if I think about my wallet and I have multiple addresses in my wallet, maybe those addresses are not thought of as addresses anymore. What if they were different closets and in each closet I have different items that help me wear a persona, I think a persona in a metaverse.

Speaker 3: 28:34

You know Apple Vision Pro dropped this month. People are going to be all over that platform trying to figure out how to make that something interesting and compelling and personalized. And when you start giving people the ability to put on digital clothes and wear these into metaverses, I mean, it's just, it's human nature. People want to express themselves. We've been doing that since the beginning of humanity and I think you know the same sorts of FOMO and aspiration and wanting to display our unique personalities. That's all going to come out all over again in a digital form. So, if anything, I just see this as a huge catalyst for digital items.

Speaker 2: 29:18

Yeah, I think. Just to say one more thing about Dropbox, one thing that is interesting here is that these collections from Mango and I guess from the other retailers as well, they can be found in this store, in Dropbox. Similarly, all the same collections can be found in these digital marketplaces that the ones that you can find in the physical stores, and you can also purchase these items in Dropbox, which I think is a big advantage. It's a big advantage against the other platforms because I think people or users of Dropbox are already very well versed in buying stuff in Dropbox. I mean, I think the first time I heard about this was my brother telling me that one of my nieces she was asking for money to buy something in Dropbox. And yeah, so people are or I guess the users of Dropbox are very used to buy stuff on Dropbox and they may not be used to buy stuff on other platforms, digital platforms. So I think this is a clear advantage for anybody, for any company, of course, and, yeah, I think this is.

Speaker 2: 30:40

This is one of the things that makes the experience here a bit different than in other places, and it could be the reason again why many companies are making their way towards, towards Roblox. The only thing that makes me Think, or the question that that I have about this, is whether I would be able, or whether I am able, to drive a Harley-Davidson In the Roblox platform. I don't know if you know. Do you know if I can drive a Harley?

Speaker 3: 31:13

There's probably an app for that. There's probably one there's probably Roblox app for that yeah there's probably something I need to check it out.

Speaker 2: 31:23

and Then my next question will be okay, if I have a Harley-Davidson in the Roblox world, will that make me eligible for a membership card from Harley-Davidson? Because Harley-Davidson has launched their own Membership program.

Speaker 3: 31:43

It's called HD I see what you did there I.

Speaker 2: 31:50

Like the name, also HD, I like it. It's like I think they're also playing high definition, but also the Harley-Davidson yeah, it's cool. So they have this HD membership and it's, of course, a membership that brings Benefits to those members that, of course, become members by purchasing items from from Harley-Davidson, I guess motorbikes, but probably other things as well and Among the benefits that they get is they get special access to the Harley-Davidson brand, like access to new products, access to specific events, accurated content and, of course, they earn points with the purchases they make on of Harley-Davidson products. So up until here, it sounds like a very basic common membership program and I wonder what do you think of this and how? Maybe it could be improved, if you have any ideas, I don't know.

Speaker 3: 32:57

What do you think? Oh, do I have ideas? Yeah, so let's, let's take a minute and put on our web three thinking caps and talk about how the Harley-Davidson HD membership could be Superpowered with web three. First of all, I want to start by saying that this is kind of near and dear to my heart because for most of my 20s and into my late 30s, I was an avid motorcycle rider. I still love them.

Speaker 3: 33:25

I just moved to a state that has crazy drivers and so I Don't. I don't take that risk these days, although it's. It's on my mind. Yeah, so I, but the point being that I understand rider culture and I understand what appeals to this audience and you know so for somebody who's been on that side of the fence, I see so many opportunities here where web three could actually create a really meaningful and valuable experience for the customer. So they talk about giving members access to new products and special membership events and curated content, and that this is going to be tailored to their individual lifestyle and their riding interests. And you know, within the Harley-Davidson brand, that might be really easy to pull off with web two technology, right, so you have a database of your customers and, as they interact with the brand, you keep track of what they're doing, and now you've created and personalized this experience for them. That is, it's in tune with what they want or with their interests.

Speaker 1: 34:29

Now let's add a few partners to the program.

Speaker 3: 34:32

Okay, so now we have, say, five participating partners, and so we've got some aftermarket parts and we've got a clothing retailer, and maybe we have, you know, an event or maybe a Liquor brand that wants to be part of the partnership. And okay, well, how are we gonna create a customized experience for this rider With all of these different players? Well, we have to integrate our systems, which means that we're gonna have to share data. It means that we're gonna have to devote development resources and dollars toward making our systems talk to each other To deliver that meaningful experience. Do it one more time and add a ring of local partners, and now it just starts to get untenable, right? Nobody has, especially at the local merchant level. These merchants aren't gonna have the technology or the resources To be able to recognize and reward that rider when they come into a local spot, which might be, you know, a huge Charlie Davidson hangout, it might be the bar down the street where everybody likes to go, and yet that can't be a part of the customer experience, because there's no way to connect the dots between all of these different players in the ecosystem.

Speaker 3: 35:39

So let's put a web 3 spin on this and let's say that my HD membership is actually a web 3 membership pass. I don't know it, but underneath the covers it's an NFT. We know that NFTs a People own them. We talked about that through this entire episode. Also, we know that NFTs can carry data with them, so they have metadata and that metadata can represent anything we want it to represent. So, as I'm going around and I'm interacting with Harley Davidson, they can send updates to my metadata. I can allow those updates. As a consumer, I can say, yes, you can access my data, you can update my data. I want to have this relationship.

Speaker 3: 36:18

But now when I leave the walls of that brand and I go to some other brand that's still within the lifestyle, it's much, much, much easier for that other brand to recognize me as a loyal Harley-Davidson customer Because I have this membership pass. It's a common protocol underneath, which is NFTs. That metadata is easily readable by anybody. It's public data on the blockchain. It's not PII, it's preference data, but it's not PII.

Speaker 3: 36:47

Now that local merchant, that regional merchant, that other brand, they can all start recognizing and rewarding me as a writer who gravitates toward that lifestyle. That's just not something that's possible today in web 2 loyalty programs. There's too much planning that has to be done in advance, there's too much integration, there's too much coordination between these different stakeholders in this program. Web 3 makes this whole process so much more fluid and so much easier for brands to actually get creative about who they recognize and reward based on things like lifestyle preferences. We can start putting together some really interesting personalization profiles for a member that we would never be able to pull off with web 2 because we just don't have access to those data points to be able to customize an experience.

Speaker 2: 37:40

Yeah, no, that's a really good explanation. You didn't even get into the possibilities for all collaboration between other stuff that hardly that it's on users may also be into, because I think something like this specifically speaks to a tribe and this tribe in particular, they like similar things. With a Web 3 membership program, you could easily open the way for other membership programs or other businesses that cater to the same audience or to the same tribe and probably share benefits for being a member of this membership and then maybe be a member of the other. I think you didn't get into that, which is another avenue which this could be used and that would be actually very cool. I think, in particular in this case, because it's a very identified person, I think of profile the Harley Davidson driver. They usually have some things in common, which is usually the case with some of these iconic brands, Any lifestyle brands you name it.

Speaker 3: 39:04

You have people that are hardcore Tesla people.

Speaker 2: 39:07

You have BMW people absolutely yeah with these iconic brands. I think you find that and that's why I think these membership programs offer more value, not only to the iconic brand, in this case, the Harley Davidson brand, but also to the universe of brands which travel along the Harley Davidson drivers or the BMW drivers or the Tesla drivers that also enjoy these other services and products that come with the lifestyle.

Speaker 3: 39:43

So, yeah, I think this should work On that point before we hang this one up.

Speaker 3: 39:49

I definitely think that there's a missed opportunity here for people that think about membership as just a loyalty play for the brand, because and I use this example all the time so I'm a T-Mobile subscriber, I get T-Mobile phone service, I'm also a Netflix customer and I've been with those brands for probably 10 years more for Netflix, probably and right now I don't have any great way to prove to the world that I'm a loyal customer for either of those brands.

Speaker 3: 40:19

The only way that I can do that is if T-Mobile decides to partner with Netflix, which they've done, and they offer me a discount on a Netflix subscription, which is cool. I like that. But that's completely reliant on business development at both Netflix and T-Mobile working together, working out the numbers, deciding that they want to go forward with this partnership, when I guarantee there are hundreds, if not thousands, of brands out there who would be eager to reward me as a consumer with a benefit because I'm a customer of Netflix and T-Mobile and it's not necessarily competitive to your point. It's about being involved in somebody's lifestyle. So you find a tribe and you find the things that they're interested in, and now all of these ancillary businesses, those satellite brands around those major interests, can come to the party and be a part of this reward ecosystem that actually promotes the lifestyle and, long term, promotes loyalty to all of these brands as a whole.

Speaker 2: 41:22

Yeah, I mean, we could be on this for ages, because I think when we see a membership program that basically rewards their users with points and that is it, we look at it and we think, oh come on, you could be doing so much more. But yeah, well, they are starting to do so much more. And well, this is what we cover here weekly when we talk about these companies and brands getting into it and, yeah, basically starting to apply, in some cases, the benefits of using Web3. So I guess next week we'll have more to talk about, but for now, thank you.

Speaker 3: 42:03

Yeah, thank you, always good to chat, talk soon, talk soon, bye.

Speaker 1: 42:15

Thanks for listening to Marketing Needs Web3. If you enjoyed today's episode, please like and subscribe in your favorite podcast app.