Incent is a platform for customer loyalty rewards built on Waves. Merchants can reward customers with Incent tokens. The tokens aren’t specific to a merchant, can be traded, and redeemable at any merchant in the Incent network. They tokens have a fluctuating exchange rate, though merchants can opt to deal entirely in local currencies and never hold actual Incent tokens. Incent is a project of Australian-based Bitscan, which has promoted the adoption of Bitcoin among merchants throughout the world and has built a directory of over 6,000 businesses currently accepting Bitcoin.
They are a couple days into their ICO and so far have raised over $500,000.
What is Incent?
BitScan is launching Incent: a platform for customer loyalty rewards oriented around a cryptographic token, Incent. Participating merchants issue customers Incent tokens, which function like a digital currency within the Incent ecosystem. The tokens can be bought, sold, gifted, or redeemed for goods that participating merchants make available. It will be operate on Waves, although customers will interact with tokens through a special wallet app and don’t need other cryptocurrency tools, knowledge, or software. Merchants never need to hold tokens if they don’t want to.
Incent is less like a traditional loyalty rewards program on a blockchain and more like a new paradigm entirely for loyalty rewards. Traditional loyalty programs might involve merchants issuing points when customers shop. These points accrue over time, and at any point, the customer they are associated with can spend them like cash for the merchant’s goods–or at a participating merchant partner in the case of network rewards. In this model, the merchant is issuing something like debt: at some point in the future, s/he must give away goods only for points, which have no value after being redeemed.
In Incent, merchants instead will buy Incent tokens from an Incent marketplace at the time of sale and give them to customers. Customers can sell them on a marketplace or redeem them for certain goods at any participating merchant. Merchants receiving tokens can then sell them or buy goods from other participating merchants. They aren’t issuing debt because they purchase the tokens on the spot, and they also aren’t incurring long-term liabilities, because the token will have value when it comes back to them.
Here is an example transaction: A customer pays $10 for a good. The merchant pockets $9, and then gives $1 to BitScan, which gives the customer $1 worth of Incent tokens. The customer can sell them or redeem them for merchant goods, in which case they essentially give their token to BitScan, which gives the merchant the equivalent amount of dollars. If the token has doubled in price on the market, then the customer can redeem it for $2 worth of goods. In doing so, s/he essentially sells the token to BitScan for $2, BitScan gives the $2 to the merchant, and then the merchant gives the purchased item to the customer.
Interested parties can view a demo of the wallet, though it is more a tour of features than a beta product. Also, their team is very responsive, and those with additional questions can ask them on the Incent slack channel.
What is the token being sold?
The token being sold are Incent tokens, which function as the payment rail of the Incent network. Merchants issue them to customers, who can hold them, give them away, trade them, or eventually redeem them for goods from participating merchants. Merchants choose portions of their inventory to be visible in the customer’s Incent wallet, and customers can complete the purchase through the merchant’s own Point of Sale system.
BitScan will act as a market broker on the Waves marketplace, buying and selling tokens on the ‘market backend’ of the Incent network. Whenever a merchant gives a customer Incent tokens, BitScan is actually buying them on the market with the merchant’s money and giving them to the customer. Given the size of BitScan’s holdings, this likely means BitScan buys the tokens from itself.
To our knowledge, these particular tokens are universal and aren’t specific to any ecosystem or coalition of merchants. Future tokens might be particular to an ecosystem of merchants.
What are the terms?
Price: The ICO start price is 10,000 Incent / BTC and will climb to a maximum of 6,000 Incent/BTC. Participants can also pay in Waves.
Distribution: Once the ICO is completed, BitScan will create 2x the number of tokens sold: half will go to the ICO supporters and half to cold storage for future use. Incent did hold a pre-ICO sale period, though how much they sold is unclear.
When will it launch? The token will be issued on the Waves platform once the ICO is over and can be accessed through the Incent wallet once it launches, slated for a maximum of 90 days after the ICO ends.
How to participate? Interested participants will create an Incent ICO account and send funds to a multisig wallet, with keys held between Rob Wilson (CEO of BitScan), Paul Klanschek (CEO Bitpanda), and Fran Strajnar (CEO of Brave New Coin). The latter two are escrow signatories and will each earn .5% of the amount raised, with a minimum of 2 BTC.
Rapid Reaction from Smith+Crown
- Incent has developed a novel approach to a rewards loyalty for online merchants. They’ve tried to insulate merchants from holding, interacting with, or knowing anything about interacting with cryptographic tokens. BitScan’s role as a market broker also helps ensure the system keeps working: it doesn’t rely on decentralization.
- Customer education and merchant acquisition will present substantial challenges. Any program targeting small or medium-size merchants faces a merchant-by-merchant uphill battle, and Incent’s loyalty program will require even more explanation than most. For customers, one intriguing feature of Incent is acquiring a speculative token, but this also will require more education. Incent has pushed recruitment to its next funding round: “a Series A funding round scheduled for 2017 Q2 will equip us with the funding base to scale.” (Information Packet, page 5) They did recently sign up their first online merchant, UK-based landscaping retailer Sure Green, and they make references to large first customers. These could provide much-needed case studies for further recruitment.
- Anything that introduces friction into the purchasing experience for customers and merchants will be a tough sell, in addition to convincing retailers and customers that the new scheme on the new technology is viable. There’s not enough information that we’ve found to truly gauge how much friction Incent will involve. How exactly will the system associate a customer’s wallet with a particular sale? Will the merchant need to do anything different–or expose part of their system–to Incent? The integration will need to be seamless, and a clunky experience could doom the project.
- Customer loyalty rewards for online retailers is less researched than for brick-and-mortar retailers. Incent cites an Accenture report on the value of rewards programs, but the findings applied to “specialty retail stores, big-box/department stores, and drug/convenience stores.” Some research (based on economic game theory) suggests that such programs work better for online retailing because the cost of switching to a competitor is so low that rewards programs can make a significant difference in purchasing behavior. In addition, reporting suggests customer loyalty programs are very complex, but that this complexity is part of the program’s power. Customers can be finely segmented based not only on data collected in the sign-up process but also on how they respond to the program. They can also be directed to different products at different times. With Incent, there is not much customization (that is what makes it simple though) and there doesn’t seem to be much data collected about customers.
- Information Packet (with ICO details)
- Articles: Brave New Coin, Econotimes
Smith + Crown does not collect money or bounties for posting these announcements. All of Smith + Crown’s announcements for ICOs should not be construed as investment advice or an endorsement. In addition, some of the information contained above may be changed after we posted this; we urge the reader to read all source material before investing or passing judgment. If you see anything that has become obsolete, let us know.
Note: This article was updated on October 4, 2016.