Crypto corner: CRM, chain-up!

In my column last month, I shone a light onto the marriage between blockchain technology and the online gambling industry. While perhaps I was a bit snappish against the lack of enthusiasm shown by some CEOs, CTOs, and the like, I did suggest the solution was education and understanding, and this is what I want to continue to focus on.

However, the one slight hesitation over possible high-risks can be appreciated; as humans, we are naturally afraid of what we don’t understand, and this is why focusing on blockchain education is key.

Blockchain and CRM

For the benefit of those who may need a catch-up, what is blockchain? On the off chance you are totally unfamiliar with blockchain, let us help you figure it out. Simply put, a blockchain lives on the internet and is an ever-growing list of interlinked records called ‘blocks’.

The block can contain any and all online data, whether it represents value (i.e. bitcoin, ethereum), a song or album, a book or article, or a client profile. Talking customer relationship management (CRM) today, we will keep in mind the client profile use-case.

But most importantly, these blocks are cryptographically secure and resistant to any external tampering, which is achieved by consensus on a decentralised network. A blockchain functions as an open, decentralised ledger that effectively keeps track of data between parties in a permanent and verifiable way.

So how will blockchain change CRM?

Here are the five areas which are likely to benefit the most from this technology:

Enhanced online security

This blockchain of blocks, where each block contains KYC data, non-fungible assets or fungible assets, is connected to neighbouring blocks cryptographically. This means the blocks are secured in a way that participating users and the host can only interact online using the same network keys. Without the same keys, they will not have access.

A security focal point is the dependency on cloud storage for all tech firms, including online betting, and while cloud security protocols have come a long way, concerns about cloud security are not completely unfounded.

Some of the biggest tech firms like Microsoft, Amazon, Google and IBM offer cloud services, but these are mainly centralised systems which, like all centralised systems, have an inherent single point of failure.

However, it must be said that this can only happen on a public blockchain today, and on a private blockchain it wouldn’t work without a blockchain audit to verify fair gameplay or another proof of authenticity by a third party.

Owning and operating a public blockchain makes tampering nearly impossible as it would require massive computing power (51% attack) to access the entire blockchain. Thus, the chances of fraud and repudiation are also eliminated.

Better transparency and fair gameplay for players and regulators

Hackers suck. Faulty gameplay does too. Blockchain gaming enables a quality of “provably fair gameplay”. When any games are placed onto a blockchain, the game logic and gameplay elements are shared as well. The consensus mechanism of the blockchain for securing the network works simultaneously to secure the game.

This means two things for businesses and gamers: hackers, cheaters, or anyone else that seeks to infringe upon what is possible for players is inherently unable to do so. If their gameplay contradicts the stated game logic, their activity is immediately rejected.

Secondly, transactions and games are transparent. If, for example, a game has a bonus that says it has a 20% chance of cashing out, players can be sure that the possibility of cashing out is, in fact, 20%. If they are unconvinced, they can look at the game logic as it’s published on the chain or on T&Cs.

It allows your company to immutably, securely and transparently deal with your customers without the need for a financial institution or cumbersome audits, i.e. banks or a third-party provider. The elimination of these ‘middlemen’ brings about greater efficiency and speed in all your dealings.

Improved customer privacy and data storage

With concerns about GDPR and personal data security on the rise, CRM systems will have to address these issues by adjusting how they handle customer data.

The solution here is the decentralised and secure nature of blockchain that gives way to the idea of a self-governing identity. It can store/encrypt personal information and verify it without sharing any specifics with the concerned parties.

This grants the business and its users greater control over their identity and personal information.

Clean and immutable data

Immutability means ’it’ cannot be changed – with blockchain in place, a customer can have their very own personal key that presents your business with a unified and accurate picture of the customer’s personal information, gameplay, transaction history, subscriptions, etc.

The advantages it has for responsible gambling policies and underage gambling concerns are also apparent. Hence, blockchain helps your business to circumvent the issue of inaccurate, obsolete and duplicate data records altogether. This consequently yields better insights into customers and helps businesses engage them more effectively.

Loyalty programmes

Loyalty programmes aim to drive profits by adding value to the customer experience. However, due to their variable mileage, volatile value and associated privacy concerns, they prove to be cumbersome for customers and yield a low ROI.

Yet, in a manner very similar to cryptocurrencies, brands can make use of blockchain to reimagine and reinvigorate their loyalty programmes. An example to highlight with blockchain is consumers could have a single decentralised wallet that is compatible with all brands, if based on Ethereum. They would not be bound by the rules and limitations of individual brands and the point of redemption would be greatly simplified.

The consumer will have far greater control over the whole experience and brands will compete for their wallet by offering them better deals.

Blockchain will not only change how we approach CRM but has the potential to fundamentally revolutionise business’ operating models in general.

With the technology still in its preliminary phase, this seems like a bold claim to make. However, keeping in mind everything that blockchain can achieve, it seems to be justified.

Thomas Johnson brings a strong B2C, B2B and blockchain foundation to the DAM team. His experience with blockchain started in mining cryptocurrencies. With this entry into market, it allowed him to explore the world of blockchain and digital assets further. He started to trade on exchanges and educate other people of the possibilities and risks of digital assets.