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Businesses usually use loyalty programmes as discount programmes or re-engagement tools. These typically are in the form of apps or membership cards, but one Malaysian F&B brand decided to leverage the rise of NFTs and their utility instead.

Called AD Butcher & Steak, it is a family-oriented steakhouse in Bukit Jelutong, Shah Alam that was established in 2020.

The initials “AD” represent the company’s founding family: Adni (the founder’s family name), Adnan (the founder), and Adam (the founder’s son).

Adnan, who’s also the company’s managing director, began his journey in 2013 by selling homemade burgers from a small kiosk.

Then, he decided to take a road less travelled in Malaysia by investing in halal steaks, specifically dry-aged steaks, which have a beefier flavour and a more tender and buttery texture.

The founder of the steakhouse / Image Credit: AD Butcher & Steak

Transitioning to an NFT restaurant

Only in 2020 did the company’s founders decide to explore the digital realm. To make this happen, they recognised the need for a specialist in establishing an online presence.

A marketing manager, Omar, was hired to create the brand’s website with the intention of easing the booking process, providing menu views, and delivering steak-related blog content.

“During MCO, we created our own online store to facilitate easy pickups and delivery services without having to rely on food apps,” said the marketer. “We started our digital marketing journey using Facebook/IG ads and Google ads to drive traffic into our platforms and eventually acquire new customers.”

When the concept of the metaverse became popular two years later, Omar observed a significant gap between the physical and digital worlds. Being an NFT enthusiast himself, he realised that he could connect NFTs to both worlds. “Even the biggest Malaysian NFT projects are missing connections to the real world,” he said.

Omar convinced the management team that NFTs could assist Ad Butcher & Steak in gaining more traction and retaining existing customers through a loyalty programme, and he began working on the project.

Partnering with local artists

The F&B outlet has partnered with local NFT artists from the Malaysian NFT marketplace, Pentas.io. The artists’ custom artworks are framed and hung on the walls for aesthetic and promotional purposes.

The restaurant’s interiors / Image Credit: Ad Butcher & Steak

As of today, AD Butcher currently has seven partners. Some of the well-known artists are Roach Punks, Catverses, and Rich Cats Nation.

The NFT artists attending the launch / Image Credit: AD Butcher & Steak

The brand employs a “dine-to-earn” concept, and the NFTs function as a rewards system. When customers dine-in, they get an NFT. This specific collection cannot be bought from AD Butcher & Steak directly.

Once they are the owner of the NFT, they can either keep it and continue collecting more NFTs each time they dine in until they can redeem the end reward on their 8th visit, or opt to sell it to another user on Pentas for a profit.

When dining in the restaurant, NFT holders are entitled to a 15% discount on the total menu price. To verify ownership of the digital art piece, the F&B outlet uses QR codes via a third-party tool, Summerwatch Technology. 

Rewarding loyal customers

To claim AD Butcher & Steak’s complimentary NFT, customers must dine in, create a wallet via MetaMask, scan the QR code, and paste the wallet address into the submission form. The marketing manager will then personally airdrop a random piece of NFT artwork to the user within a 24-hour window.

Customers scanning the QR code to claim the free NFTs / Image Credit: AD Butcher & Steak

“We created our NFTs to resemble our food menu,” Omar explained. “The first batch is 500 steak NFT platters. Each NFT has our brand logo, the type of meat we use (Grain Fed, Angus, Wagyu), and the different cooking styles we have (rare, medium, medium well, and well done)”.

According to Omar, their most popular NFTs correspond to the popular steak classifications: Wagyu, Golden, and Medium Rare/Cooked. On the other end of the spectrum are Well-Done and Grain-Fed, which are the cheapest type of steaks.

The brand’s NFT in relation to its signature dish / Image Credit: AD Butcher & Steak

On the first visit, diners will get their first NFT. As one ascends the loyalty ladder, more perks will be granted.

For second and third visits, customers can claim a complimentary side dish and beef burger respectively, in addition to an NFT on each level. Based on the programme, loyal customers can redeem their final reward on their eighth visit: a BBQ back ribs dish worth RM139.

The reward system / Image Credit: AD Butcher & Steak

Alternately, instead of dining in each time, individuals may simply purchase seven NFTs from other customers on Pentas to reach their desired tiers and redeem their rewards.

The team at AD Butcher & Steak reasoned that, depending on the price of the NFTs being sold by other customers, it may be a cheaper option than dining in each time to climb the loyalty ladder.

Due to incurring hefty gas costs to mint the digital tokens, the company is currently not profiting from its NFT project. Instead, the founders intend to profit from secondary market sales once their NFTs have been circulated by the NFT owners.

AD Butcher & Steak also intends to generate revenue by auctioning off the custom artworks of its NFT partners (in a different collection from the dine-to-earn ones), and the issuer of the NFT would receive royalties from each sale.

The different variations of NFTs on Pentas.io

In for the long haul

We inquired with the marketing manager as to whether the NFT project is a temporary addition to the restaurant, as some business owners implement new trends seasonally. “We are here to stay,” he affirmed with Vulcan Post.

The founders are also interested in establishing a second outlet somewhere in Kuala Lumpur, though they have not disclosed the exact location.

It’s likely that the new outlet will implement this dine-to-earn concept too, and it’s one way that AD Butcher & Steak can stand out among the other ways businesses have jumped on the utility of NFTs.

In the F&B space, another business we recently featured using NFTs in its own loyalty programme is MyeongDong Topokki’s NFT restaurant in Genting Highlands. Instead of a dine-to-earn concept though, customers can just purchase the NFTs outright and then enjoy the perks at the Genting outlet exclusively.

These are just two of several applications for NFTs’ utility across industries though, and with Miss Universe Malaysia recently revealing its own collection of NFTs to be used as a voting mechanism, it’d be interesting to see how else NFTs can continue to be used in the coming months.

  • Learn more about AD Butcher & Steak here.
  • Read more of our NFT content here.

Featured Image Credit: AD Butcher & Steak

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Vulcan Post aims to be the knowledge hub of Singapore and Malaysia.

© 2021 GRVTY Media Pte. Ltd.
(UEN 201431998C.)