Brief:
- Red Bull and Swarovski are among the brands that are testing out Kin, the cryptocurrency created by Canadian messaging app Kik. Users can collect Kin for performing actions like watching a video commercial or answering surveys and can then redeem them later for rewards from brands such as Domino’s, Nike, Gamestop and Sephora. Last month Kik released an Android app called Kinit that works as a digital wallet to collect, store or spend digital Kin coins, per Adweek.
- Red Bull and Swarovski worked with market researcher Swelly to give Kik users online surveys that rewarded those who answered 10 questions with Kin. Red Bull asked for thoughts on ad copy to determine their preferences of images — either a picture of someone riding a mountain bike or diving off a cliff — to accompany the tagline "Soaring into the sunset."
- TrueX, 21st Century Fox’s ad-tech division, also used Kinit to reward users who watched 30-second spots from its advertisers. TrueX had previously given now-defunct Kik Points as an incentive, which users could collect and trade for digital stickers or other items to decorate their messages.
Insight:
Red Bull and Swarovski's tests of Kin rewards indicate that brands are trying new ways to interact with consumers, especially those who don’t want to give up their personal data in exchange for using social networks like Facebook or search engines like Google.
A key question for Kik is whether the company can develop a growing economy of consumers and businesses that use its messaging platform to share information in exchange for digital coins that can be redeemed for items that have real value to users. One of the limitations of its Kik Points system, which was shuttered in March 2017, was that the points could only be used for items like digital stickers and custom emojis, which were free to download.
Unlike Kik point, Kin coins can be traded for real money or gift cards, and the supply is capped at 10 trillion coins. Kik sold 1 trillion coins through an initial coin offering (ICO) last year that raised about $100 million. It was less than the original $125 million target, but there were technical problems with the Ethereum digital currency platform.
If Kik is successful engaging more consumers and brands, the company may provide a model for how companies create new digital economies. Both Facebook, which is said to be developing its own cryptocurrency, and Starbucks, which recently partnered with the owner of the New York Stock Exchange on a bitcoin startup, could follow in Kik's footsteps.
Cryptocurrencies derive their value from being used for transactions, not just being stored away in a wallet, Kik CEO Ted Livingston said at a conference in June. According to the Financial Post, he also said that the blockchain technology that underlies digital currencies like bitcoin and Kin may not have that many practical applications. "Unless you’re trying to build one of the most-used cryptocurrencies in the world, it’s very low odds that blockchain is going to create value for you," said Livingston.
