# Blockchain-Based Loyalty Management System
## 2 Literature Review
### Related Work
While the exploratory case with blockchain has proven to be more effective than existing traditional schemes to satisfy customers, both papers state that more future research is needed to explore the relationship between blockchain design for loyalty programs and customer behaviors. The work described in [7] aims to review the potential and challenges of blockchain in marketing areas for building brand loyalty. The authors first describe blockchain technology and its unique features. Then, an overview of the characteristics of brand loyalty and currentfailures is presented. The authors of the paper also explain how integration with blockchain infrastructure can eventually solve and improve the quality of loyalty programs, making them more effective and affordable. The authors in [19] propose an implementation of a loyalty program for a mobile platform based on the Waves blockchain. The choice for this blockchain platform is due to its lightweight and fast features when compared to Ethereum, and to the premise that the cell phone is an essential commodity today. The proposed solution consists of three key components: a token creator in Waves, a web API, and a database to store accounts' information. In [6], the authors give a simple introduction to blockchain and aim to analyze its impact on the retail industry and customer loyalty. Although the authors focus both on the supply chain and loyalty areas, their emphasis is on the need for a loyalty program as the best solution to retain customers. According to them, customers remain dissatisfied even though numerous companies are now investing in loyalty programs. To support this claim, the authors provide statistics from a survey in which they list several problems pointed out by the respondents. They also suggest that blockchain integration could potentially address these issues and provide a lower cost system with better security and transparency. In [20], the author studies the importance of blockchain technology in enhancing loyalty programs. The scope of this paper is restricted to the airline business. Regardless of the study domain, the author explains how blockchain can impact and revolutionize a company's experience. Integrating blockchain technology from a business perspective could reduce maintenance costs and enhance customer service. Blockchain can foster better customer relationships and captivate customers by providing the benefits of traditional loyalty programs and better customer service. From the point of view of the transaction process, blockchain also makes all the validation, storage and sharing of transactions easier, since intermediaries would no longer be needed. For better context, the author explains the five basic principles of blockchain. This study consists of a survey that was carried out using two sources of information: the primary source, using 450 questionnaires, and the secondary source, the literature. The 450 questionnaires were distributed among customers and airline managers, and a high-efficiency response rate was achieved. The use of blockchain technology was emphasized by the surveyed airlines. They concluded that the degree of effective use of customer loyalty programs is related to blockchain technology, and the results showed that loyalty systems were effectively improved by blockchain integration. In [21], the authors propose a blockchain-based framework to enhance loyalty programs in the fast-moving consumer goods (FMCG) industry. This framework aims to revolutionize the conventional process of exchanging coupons by introducing a token called promotion asset exchange (PAX). Instead of customers purchasing products and retaining coupons for later trading with merchants, followed by the cumbersome process of merchants trading numerous coupons with the manufacturing company, which can lead to counting errors and result in confusion, customers will scan a QR code on the product packaging, and the promotion (PAX token) will be stored in their wallet.