BMW launches blockchain-based reward program in South Korea

The South Korean subsidiary of German automaker BMW announced the launch of a blockchain-powered customer loyalty program called BMW Vantage.

Local English-language news outlet The Korea Herald reported on Oct. 7 that BMW Vantage will launch in South Korea and will allow customers to collect reward points. Those points can then can be redeemed and used to get discounts on services that the program offers.

While South Korea will be the first country to launch the membership scheme, the firm plans to eventually roll it out globally. The local BMW subsidiary is already running a trial on the new platform and plans to enable it countrywide later this year.

Rewards BMW Vantage members will be able to get include discounts on vehicle maintenance and services provided by the firm’s partner companies. Furthermore, high-tier members will receive invitations to cultural events.

The Korea Herald notes that first-time buyers of new BMW models could receive 300,000 to 500,000 points. The value of those points is unspecified, but 1,000 points to $1 is a standard loyalty industry ratio. People who acquire new top-end model vehicles like the BMW 5 series and 6 series will be able to get up to 900,000 points while  X1, X2, and BMW 1 series and 2 series will be eligible to receive up to 600,000 points. 

Lastly, membership points can also be won by users through the participation in games and social features on a dedicated app.

Blockchain use in loyalty programs

The ability to create a record of digital assets that cannot be counterfeited or easily stolen is a feature of blockchain that can easily be applied to customer loyalty point collection programs.

As Modern Consensus reported a little over a year ago, blockchain-as-a-service provider Loyyal is one of the companies convinced that applying blockchain to loyalty point programs will bring great advantages to the industry. Companies worldwide reportedly spent $126 billion on loyalty programs in 2019, and Loyyal believes that blockchain can reduce the cost of running those programs by 80%.

More recently, in April this year, social media behemoth Reddit also started experimenting with a loyalty program on the Ethereum blockchain that offers “community points.”