Decentralization gives an opportunity to be in a position of both sides. Anyone can use tokens to build an Overlay on the basis of LOYAL token or use Tokenloyalty project to make own campaigns in the Overlay. The advantage of the Overlay is that It will aggregate merchants into one ecosystem. This is very important because of the behavior of customers as loyalty program users and merchants, who want to operate freely – either in an ecosystem (SMEs) or individually, which is very often used in corporations. As the study shows in a group of loyalty program users, the main problem is that any effort they make to collect points must be granted with “prize”. Tokenloyalty have made a simulation of effort and people divide into several groups, however, there are common things like “money, prize.
Points are token, token is money. Tokenloyalty study showed that for one of the groups basic functionality will be to collect money and have the ability to realize them in partner network of shops, services etc. However, if the effort is granted the good prize, they are changing into the aggressive lead generating officers based on social mechanism. This is based on activation of users that is based on gamification mechanisms. Pay per lead. For merchants it is very important to have return from the investment. In traditional loyalty programs, it is all about costs. For example, points are calculated such way to generate demand on products with the highest margin to “get something” from their price and lower the basic costs of the program. But customers are not stupid, as well as they would like to have freedom in a collection of points on things they really want to buy. This is why Tokenloyality have thought about an ecosystem where merchants pay per leads which is closer to marketing based systems than loyalty programs.
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Tokenloyalty main problem of old-type loyalty programs is their centralization. This means that you do not have the control over the collected points and the merchant finally decides what you will do them. For example, when the campaign ends, your collected points would be useless… As global data shows, collected points, codes and other non-physical assets do not represent any value after the end of such promotion. Tokenloyalty has calculated that almost 40% of participants of such loyalty programs forget about the collection of such points and do not realize them. A token is a solution. It is related to its nominal value. This means that if you do not want to participate in any campaign but you have collected tokens, you may just cash-out through exchanges. Token will always represent a nominal value noted on exchanges and additional values from the promotions coming from the partners or advertisers on the dedicated LYT your life platform. It will be like calling a taxi whenever you want to use a promotion.
How the business model works
Pay per lead
The main source of income is leading. Because decentralized model lowers the costs in acquisition and maintenance, Tokenloyalty is able to automate many processes giving the fair price to the customers of the platform being strongly competitive to other solutions on the market. Pay per lead means that any generation of a new customer is charged a fee.
One of the sources of income for the company is the commission based system on transactions in the platform. These transactions are based on an exchange of tokens and distribution of goods to token holders under the specified loyalty campaign in the loyalty ecosystem. Tokenloyalty model will vary based on individual negotiations with each partner entering the ecosystem. Because of the advantage over the competition, the model will not be shown in the whitepaper, as it is the strategical know-how.
Settlement is settled with goods rather than money
Anyone who knows the FMCG market and operates in such campaigns knows the common model of settlement made by goods. Sometimes it is also called as barter commission of goods for internally accounted profit. This is a common mechanism, which Tokenloyalty won’t describe in details, as it may differ depending on the situation. For example, a Soda Drink Company gives 3000 bottles into a campaign for distribution to loyalty program users with additional 1000 bottles as commission. This Soda is worth 1 USD each in “transaction price”, but the production costs for the merchant are much lower. They are paid in “bottles” selling them to wholesale as Tokenloyality commission.
Token value of the company
The token has its “nominal” value, which means the price in relation to fiat currency or common cryptocurrency. This value is related to demand and supply over the token on exchanges. An initial value of the token is based on ICO sale, while during the time, it changes due to trade. Because Tokenloyalty business model is constructed in such manner that every campaign engages new people that may be the participants of the specified campaign, which is then related to purchase of the tokens by the advertisers, the ‘nominal’ price should go up. But there are also benefits related to the campaigns that Tokenloyalty call the added value. For example. John has 2 loyalty points in the form of token. These tokens may have the nominal value of 4ETH, which is approximately 800 USD. John may sell the tokens on the exchange but may use these points in several campaigns. For example, one campaign distributes to the tokens discounts for purchase, another distributes physical goods in form of soda drink.
Tokenloyalty that wants to create a specified campaign buys tokens in frames of a specified budget. This
way, initial contributors of the ICO may establish the value on the second market. This way the company that creates a loyalty program for the brand may extend the amount of the network of users of the loyalty program. However, this does not affect strongly present users, because they offer a specified amount of tokens in dictated price. This way present token holders dictate the nominal price, with no harm to entry costs. Company then generates on the platform entry codes for wallets, depending on the campaign’s channels of entry to these customers.
Grzegorz Sperczyński – Role in the project: CEO
Grzegorz Rutkowski – Role in the project: CMO
Juri Koniwszczyński – Role in the project: CTO
Iwona Sperczyńska – Role in the project: Twitter communication
Also Check – Tokenpay.com Ico Review : Introducting The World’s
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