Charles H. Miller
American Express Travel Related Services, which is the travel and merchant unit of American Express (aka Amex), is looking to use blockchain for customer rewards. The company is already offering points on different purchases with many of its credit cards; and is now looking to decentralize the system to (also) offer points, a digital currency, and/or specific items linked to a product.
To that end, Amex has filed a patent with the US Patent and Trademark Office (USPTO) for a technology that will provide rewards by collecting personalized data about its customers, including their historic spending patterns.
The filing, entitled “PRESENTING A PERSONALIZED VALUE ADDED OFFER DURING AN ADVANCED VERIFICATION PROCESS,” details systems and methods for presenting a personalized value added offer during an advanced verification process are provided.
The blockchain structure may include a distributed database that maintains a growing list of data records. The blockchain may provide enhanced security because each block may hold individual transactions and the results of any blockchain executables. Each block may contain a timestamp and a link to a previous block. Blocks may be linked because each block may include the hash of the prior block in the blockchain. The linked blocks form a chain, with only one successor block allowed to link to one other predecessor block.
Amex is a member of the Hyperledger Blockchain consortium
The company has joined the consortium, led by the Linux Foundation, in January to facilitate its works on the technology. Part of that work is to “fully exploit” what Blockchain has to offer for their customers and partners, as well as to explore how the technology could transform their own business processes and applications.
“We’re excited to join Hyperledger, as we’re looking to take full advantage of Blockchain to deliver new and innovative products for our customers and partners, while transforming existing business processes and applications,” Amex CIO Marc Gordon said at the time.
Not the only company working on a blockchain-based loyalty program
One of the firms looking at this market is the technology consulting firm Capgemini, which is working with Ascribe that would find it using the startup’s solutions to create a real-time rewards system. Also, other consulting firms are also on board as well, including Accenture, PwC, KPMG and Deloitte.
The last on that list [Deloitte] has issued a report to explore and analyze the (potential) use of blockchain in loyalty programs. The company argued that blockchain is well suited for the task, offering a mechanism by which a loyalty program would function similarly to digital currency. For instance, customers could receive reward points that can be redeemed for, say, an upgrade to a plane ticket.
However, as we said in an article about Burger King’s WhopperCoin, the success of blockchain-based loyalty programs depends on whether enough companies actually adopt the technology in a meaningful way. In that sense, Amex can play into its existing customer base and beef-up the offering with the help of blockchain. Sounds like a plan.
