Coffee Franchise Customer Loyalty Programs on the Blockchain

By Curtis Chappel, Blockchain Training and Blockchain Consulting.

Tekka Yassin member of Kotta PC checking his coffee before collection soon.

All coffee shop owners, both global franchises as well as one-off cafés, are always trying to find new ways to find and retain customers. One very successful option is to implement a customer loyalty program in their business, where patrons get rewarded for purchases and even for referring their friends and family.

According to one case study1, “Starbucks has reported an increased revenue of $2.65 billion, attributing their rewards program for most of the increase. Over the last two years, membership has grown more than 25%, loyal customers use Starbucks’ membership program (16 million members) for about 40% of sales at the company’s US stores. Revenue rose 4.6% to $6.31 billion during the quarter from the previous year.

The implementation of these programs can obviously be very profitable, but how would an organisation implement a coffee drinkers loyalty program?

Depending on your age, you might recall those paper cards that you carried around, and at the point of sale when you purchase your cup of coffee or tea, you would get the card stamped or a hole punched in it to prove the purchase. Usually, 8–12 purchases are required before you receive a free cup of coffee.

And while this process is still being used by many coffee shops and franchises, some food and beverage retailers have implemented a smart phone app which allows the retailer to include many more features such as push notifications, profile sharing, content generation, a rating system, user-user texting and much more.

Starbucks has taken this concept even further with purchases accruing stars, so each type of cup of coffee purchased provides a reward of a set number of stars and each type of cup of coffee also has a specific number of stars required before you can get that cuppa for free as a reward.

OK, so customer loyalty programs are very common, especially amongst the global coffee franchises around the world. So, if you were to arrive at the local mall for a coffee, and there is a Gloria Jeans and a Starbucks in the mall, and they both effectively have the same incentives in their loyalty programs, which would you choose?

What if you could not only accrue points towards your next free cup of coffee, but you could see exactly where those specific coffee beans were grown in the world, AND you could see a photo and a short bio of the actual farmer who grew those beans?

Then, as additional feature, you could actually tip that specific farmer, via the smart phone app, and say thank you to them for providing you with such a wonderful and tasty experience, while also helping them improve their lives with just a few donated pennies?

Did you know the average rural coffee farmer only receives .07 cents for each cup of coffee purchased?

So, by tipping a farmer even just .25 cents, you have quadrupled the revenues that farmer would normally receive! And that is life-changing money for these last mile, rural farmers in remote locations around the world.

AgUnity, an Australian-based blockchain-based supply chain developer, has created this as a customer loyalty program solution in their smartphone app, built using blockchain technology.

With AgUnity, the farmers are provided with a very rugged, custom designed smart phone with the AgUnity application embedded in the phone. This app allows farmers to capture and record their coffee beans at the point of harvest and that harvest batch is then recorded to their blockchain solution. Now, that specific batch of beans can be tracked all the way through the various supply chain processes and transportation required for you to be able to drink that cup of coffee.

So How Does the AgUnity Blockchain Solution Work as a Customer Loyalty Program?

Without going through the technical implementation, the coffee supplier or retailer would pre-purchase AgriUT tokens from Agriwards website. Then they would determine how may tokens (each token is currently valued at .01 USD) would be assigned to each cup of coffee or bag of bans or bag of ground coffee, and that amount of tokens would be written to a QR code which is printed on the cup or packaging.

A very simple solution could be utilized where at the point of sale of a bag of coffee or a cup of coffee, a tip is automatically sent to the c-op or selected farmers. In a more engaged user experience, retail consumers could download the AgUnity App that will allow them to view the farmers and access their tokens. The coffee drinker could then find the farmer who grew those specific beans and send a tip to that farmer via the app.

There is also the opportunity for end-user coffee drinkers to purchase AgriUT tokens directly themselves, so they could be proactive in their support of the rural famers who grew those beans.

Changing People Lives for the Better

By engaging and supporting these farmers directly, coffee drinkers can assist these farmers to do the following:

  1. Access to Mobile Communication
  2. Borrow Micro-loans
  3. Purchase Farming Supplies
  4. Access to a Digital Identity
  5. Access to Online Banking
  6. Access to Online Education
  7. Share Tips with Other Farmers on the Network
  8. And Much More as the App is Further Developed‍

And all of this magic happens on the blockchain, which assures consumers that each cup of coffee actually was grown by that farmer, in that country and was harvested on that day, because transactions written to the blockchain are “immutable”, meaning they cannot be changed or faked by anyone involved in the coffee bean supply chain.

Please contact the team at AgUnity to learn more or go to the Agriwards website to purchase AgiUT tokens to become a part of our growing global family of farmers, co-ops, roasters, manufacturers, and coffee lovers from around the world to help us create opportunities for these rural farmers to change their lives and grow better coffee!

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Resources:

  1. https://www.zinrelo.com/loyalty-rewards-case-study-new-starbucks-rewards-program.html
  2. https://www.weforum.org/agenda/2020/10/economics-coffee-cup-costs-break-down

AgriUT is a digital utility token system that engages consumers through direct interactions and a means to reward and thank farmers that grow our food.