Source: Sweatco.in homepage
Rick Ferguson, Editor-in-Chief of the Wise Marketer Group
Through a special arrangement, presented here for discussion is a summary of a current article from The Wise Marketer, a website and newsletter serving the global loyalty industry.
Studies of consumer psychology tell us consumers are motivated by rewards and recognition. Entice them with economic rewards and soft benefits that induce positive feelings about your brand, and they will buy more, buy more often, tell their friends, and develop a lasting relationship with your brand that instills customer loyalty. Do the same techniques work to motivate personal behavior changes that lead to life improvements?
In September, Sweatcoin, an app that rewards individuals for staying active, became the most downloaded health and fitness application in the U.S. and it has retained that top ranking nearly every week since, according to The New York Times. Launched in December 2016 for iOS and April 2017 for Android and available in the U.S. and U.K., the app just raised $5.7 million in its second round of funding.
That success is due entirely to the app’s business model, which is based on classic loyalty marketing techniques.
Designed to motivate more active lifestyles, the app tracks a user’s outdoor steps using their phone’s accelerometers and GPS location and rewards them with “sweatcoins,” a virtual currency, that can be redeemed for anything from small-denomination gift cards up to a new iPhone X. Like money, coins can be also sent to friends or donated to charity.
The app is free at the basic “Mover” level, with options to move up to three higher fee-based tiers that accelerate earning. Indoor activities such as running on a treadmill don’t yet count towards rewards, although an update is being worked on to counts indoor activities.
The parent, London-based Sweatco, receives a fee from manufacturers and brands who market their products to sweatcoin users and also accept the virtual currency as payment. Sweatcoin also hopes to partner with insurers and corporate wellness programs to help motivate their members or employees to exercise. It’s also working with local governments to have Sweatcoin more widely accepted as a payment method and even traded for other cryptocurrencies.
Competitors including the similar U.K.-based Bitwalking app as well as Charity Miles, which turns steps into charitable donations.