“Navigating Brand Loyalty: How Starbucks Odyssey’s Community Lead Embraces NFTs”

The NFT (non-fungible token) market may have experienced a significant decline from its peak, but according to Steve Kaczynski, co-author of “The Everything Token” and community lead for Starbucks Odyssey, there is still value for brands and loyalty programs looking to connect with fans in innovative ways. Kaczynski predicts that companies will expand upon “brand anchors” such as reward programs in 2024, and believes that this year will see a rise in community-based brand building, as shared on the TechCrunch Chain Reaction podcast.

In 2022, Starbucks launched Starbucks Odyssey as their first venture into the web3 world. This experience combined their popular Starbucks Reward loyalty program with NFTs to enhance customer experiences, as reported by TechCrunch. Kaczynski explains, “We’re able to help people find their tribe…I’ve seen that people who live in California in the Starbucks Odyssey community are really good friends with people in Chicago and they have met up in real life at times. This never would have happened if not for web3.”

The loyalty program offers a five-tiered system with over 58,000 active members on at least level one, according to Kaczynski. “I can promise you those aren’t mostly or all web3 native people…it’s not just web3 people who are participating.” Additionally, those who reach tier five of the program have purchased a “decent amount” off secondary marketplaces. For example, in December Starbucks announced that they would be sending their top 20 participants to Costa Rica to visit their coffee farms.

Kaczynski believes that there is potential for other “third-party utilities” to be developed through NFTs, not just by big companies like Starbucks or Nike, but also by local businesses wanting to create loyalty programs or use tickets as an anchored and incentivized asset. He gives the example of Hot Pockets, a food brand, offering a 20% discount to gamers who buy their Fortnite skin and connect it to a crypto wallet. “The purchaser is happy, the eater is happy and they get a discount and they’re in the ecosystem,” says Kaczynski. “This person isn’t just a gamer, they’re an active gamer who’s participating and willing to spend disposable income on third-party things.”

When people think of NFTs, they often picture expensive pictures of monkeys on the internet, such as with the Bored Ape Yacht Club, but according to Kaczynski there is more value to be held in owning NFTs. He compares it to going to a museum and seeing a beautiful painting on the wall. “You can take a picture of that painting but it’s not worth any money,” he says. “The picture on the wall is worth money because the museum owns it, it’s the original and they can prove both of those things. Up until recently you couldn’t do that with digital items, until NFTs came out.”

Kaczynski adds that the ability for brands and companies to buy, sell, and truly own loyalty is a new concept, making it less one-way. “While not all community members engage in buying and selling…I think for a lot of people, having that optionality is so important.”

This story was inspired by an episode of TechCrunch’s podcast, Chain Reaction. Subscribe to Chain Reaction on Apple Podcasts, Spotify, or your favorite pod platform to hear more stories and tips from the entrepreneurs building today’s most innovative companies.