With the travel industry increasingly moving into the brave new digital world, in the second part of our look at the Metaverse, NFTs and Web3, we look at document verification and customer loyalty and reward schemes.
Our first article examined immersive virtual reality experiences and Postage Stamp NFTs.
Document Verification
An exciting use of blockchain in this space is its application in the storage and transfer of confidential documents or information.
By way of a reminder, Blockchain is a shared ledger made up of “blocks” securely linked together using cryptography. Usually, these are managed by peer-to-peer networks on computers (nodes), where the blocks are verified as true by the majority of nodes. This applies to both existing and new blocks.
The confidential information that could be handled includes:
- ID/Passport details
- Vaccination or health status
- Visa and other e-documents
Some innovative companies are finding ways to ensure that customer data is kept in an incredibly secure fashion, whilst also providing them with convenience when they travel.
In addition to some of the legal considerations we mentioned in our first article, the most immediate concerns for companies operating in this space are in respect of data privacy and data breaches; and verifying that the data submitted is legitimate.
Whether you are a travel company looking to use these types of innovations or the tech provider, the following should be borne in mind:
- Where personal data is being handled or processed, companies should ensure that proper technical and operational measures are in place. These measures should be transparent and readily available to anyone whose data is being handled. Data security is top of everyone’s agenda at the moment.
- Having suitable and adequate privacy and cookie policies in place and available for review are fundamental for customers. These will allow customers to understand exactly how their data is used and for what purpose. By avoiding these responsibilities, travel companies may find themselves on the end of large fines as regulators across the world start to crack down on flagrant violators.
Reward Scheme NFTs
A few players in the travel industry are exploring how to link their reward programmes to Web3.
The basis of the rewards, which vary across companies, usually depend on how often you travel. Companies are still fundamentally offering a reward scheme – you buy from us and we’ll offer you something in return – but are doing so in a different way. The ingenuity comes through the use of blockchain to provide customers with some or all of the following perks:
- Airdropped NFTs – by airdropping NFTs, customers receive the NFTs directly into their (digital) wallets as a result of a gift/raffle/giveaway organised by the NFT provider, without the customer having to directly purchase them
- Collectible NFTs – companies could encourage people to travel to specific destinations by including a free mint (the process of converting the digital files into a blockchain digital asset) of a location specific NFT after the journey is completed. This NFT could then be sold on a secondary market and fetch a different price depending on its rarity
- Blockchain verifiable lounge access passes – holders of NFTs can easily demonstrate their eligibility to access lounges at various participating destinations
- Unique PFPs (profile pictures) that people can control as their 3D avatar in the Metaverse, or their profile picture on social media and enjoy for personal use. Often this allows people to form cliques or exclusive clubs that in turn provide benefits beyond those envisaged by the creators
- Airdropped unique holiday packages – either through competition or random drops of exclusive holiday experiences to eligible NFT holders
- Loyalty bonuses – holders of NFTs can receive tokens deposited directly to their wallet after completing various transactions or journeys.
Travala (a travel company that launched an NFT collection on their AVA blockchain) is one such
example of an NFT based customer reward programme and often offers NFT holders a chance to win
exclusive holidays.
Previous prizes have included a trip to Argentina, a Singapore Grand Prix package holiday and a trip
to the Maldives valued at $75,000. The holder of the winning NFT can then sell both the NFT and the
holiday (associated to the NFT) to another individual through an NFT marketplace.
In addition to this competition, the NFT allows owners to get up to 10% loyalty rewards for booking on Travala, access to the Metaverse and Concierge access.
Another example is the airBaltic reward programme (Planies), which will include giving holders access
to frequent flyer points and vouchers. The public mint date was 4 October 2022.
So, what should airlines and travel companies consider when creating these programmes?
- Terms and conditions for the reward programme – and what happens when they are breached
- The IP and commercial rights granted with the actual NFT which we mention in Part 1
- The jurisdictions your reward scheme will be governed by
Comment
The potential of travel tech to grow alongside Web3 is remarkable, but creators, companies and agencies should bear in mind the following key issues when entering the market:
- Commercial agreements for service providers
- Terms of use for customers
- Data privacy laws; and
- Protection of IP rights
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