The apparel industry has been testing the waters with digital and cryptocurrencies for the past several years, experimenting with it as a tool for everything from education, to authentication—and now, to consumer engagement.
Babyghost, a Chinese fashion label, for example, launched a branded digital currency by teaming up with VeChain and BitSE to tell customers the stories behind the garments in their upcoming collection.
This year, luxury fashion group LVMH (owner of iconic brands like Louis Vuitton and Dior) also announced a foray into blockchain-based cryptocurrency aimed at tracking and proving the authenticity of its goods.
Now, digital currency is being leveraged as a way to drive engagement with younger audiences and digital natives.
We see this illustrated by outdoor apparel and equipment brand Fjällräven, which launched a virtual scavenger hunt at large universities across the US this August wherein participants could use their phones to hunt for digital currency dubbed “Fox Coins” (named after the brand’s logo.)
Fox Coins, a digital currency built on proprietary and programmable blockchain tokens known as Vatoms, served as entries for the brand’s “Kånken-a-Day Giveaway” campaign. Participants could enter to win a free Kånken backpack every day during the month.
The utility of their digital currency didn’t stop there, however.
Participants who entered an email address online were also sent an invite link where they’d find a branded wallet including a Fox Coin as well as access to the geo-locations of other nearby entries (in the form of Fox Coins) on a map via the user’s phone-based GPS.
An added bonus: This technology got people outside–which is one of the brand’s core values.
“This project reinforces our longstanding values of going on an adventure in nature, navigating new territory, and welcoming everyone to the outdoors,” said Nathan Dopp, Fjällräven’s CEO of Americas.
Once collected, Fox Coin owners could then redeem their digital currency for small branded items or discounts on the brand’s higher-ticket items.
Dopp went on to share that in past iterations of the Kånken-a-Day campaign, consumers could simply re-enter their email address every day for more chances to win a Kånken bag.
With the Fox Coin, however, they were able to test the waters with a new form of storytelling via technology–while still staying true to their legacy and brand heritage.
“The focus of the Kånken-a-Day Giveaway campaign was to drive brand loyalty and increase engagement with the Kånken audience,” Dopp said. “We’re investing in virtual technology and shifting our focus to a platform that feels natural to digital natives, and we see this as an important next step in content creation.”
The internal strategy behind this campaign and the digital currency was to expand the brand’s presence through a new channel that would allow them to share their 60-year history of sustainability and quality—but with the functionality and flexibility to personalize and gamify the experience.
The results of their first run with branded cryptocurrency were impressive: Fjällräven saw a 253% increase in contest entries compared to the previous campaign in November 2018 without the virtual currency element. What’s more: They exceeded their cost per acquisition goal by 56%.
“What made this campaign a game-changer was Fjällräven’s vision to use an entirely new ‘post-ad-click’ experience to engage the mobile-first audience we were seeking,” says Tyler Moebius, CEO of digital advertising platform provider FastG8.
“We tapped SmartMedia Object technology by air dropping augmented reality enabled coins in order to meet consumers where they were.”
Looking ahead, this program will serve as the basis of a forthcoming loyalty program for the brand as well.
While this particular experiment with digital currency was successful, Brendan Witcher, Forrester’s Vice President and Principal Analyst of Digital Business Strategy, warns that brands considering their own forays into crypto or digital currencies should be certain those experiences are rooted in value (rather than pure novelty.)
“Novelty can work to build a customer base, but ultimately those experiences need to be replaced with something that adds meaningful value in order for the relationship to be sustainable,” he said.
He went on to say that companies looking to utilize digital technology to improve customer experience need to take a hard look at what customers expect from experiences today.
“A mistake companies often make is creating something innovative, like a cryptocurrency application, when they haven’t gotten the basics of good customer engagement right yet,” he said.
As other brands consider how similar tech might be beneficial to their audiences, they’ll need to evaluate whether or not they’ve first perfected their primary forms of customer engagement—like email, social media, and in-store experiences.
read more at http://www.forbes.com/retail/ by Kaleigh Moore, Contributor