Designing a Consumer Incentive Program for Today’s Rapidly Changing Retail World
Retailers have long seen the value in providing rewards and rebates to consumers, often to reward or encourage behaviors like frequent or timely purchases. But incentive programs aren’t what they used to be. Etail and smartphones have fundamentally changed the way people shop. The fading popularity of shopping malls and ever-evolving consumer demands have created a highly competitive retail environment that is changing more quickly than ever before. However, rewards-based promotions are highly desired and effective. In fact, reward-based promotions have been shown to exceed performance of discount-based promotions by over 21 percent for positive brand image creation.1
Customers’ preferences for redemption options, ease of program participation, reward variety and fast delivery are all things to consider when designing a retail incentive program. When these elements are taken into account, while also taking advantage of advancements in technology, rebate and promotion validation intelligence, and reward delivery, it’s possible to deliver a better incentive experience.
Provide customers with the access they want
Incentive programs should also be omnichannel. A recent Hawk Incentives study found that of all the survey respondents, 78 percent of consumers prefer digital rebate submission over mail.2 Incentive programs like rebates, loyalty, thank-you and other rewards provide retail marketers tremendous engagement and data opportunities. However, don’t make the mistake of shoehorning everyone into a mobile app or mail-in experience. Retailers today know that customers want to pick their own journey; it’s nonlinear and they want choices. Your incentive program should be no different.
Create ease of participation
Data is a key component of any great incentive or rewards program—but don’t be greedy. A simple experience can create the opportunity to dramatically expand the customer engagement. Consumers want to engage, so don’t be overly burdensome in the information you collect. Try to curate the redemption experience on their behalf so the process is as simple and painless as possible. If you simplify your program criteria, you may also get additional survey responses, referrals, social shares, reviews or more.
Offer reward variety
Variety is the spice of life—and a critical component to reward program success. Consumers today want to choose their reward and how it’s delivered. A reward card today can be delivered as a physical card, email or even transferred to a mobile wallet. But consumer preference varies widely by application, value and demographic. An effective program must offer reward choice for participants in order to satisfy a potentially diverse recipient group. Offering the right reward creates additional opportunities for positive brand engagement, bounceback and continued interaction.
Speed of delivery
You can improve the odds of consumers associating a positive customer experience with your brand by providing rapid rewards. According to research from Hawk Incentives, respondents say the ideal reward is delivered in less than a week.2 Innovations in technology now offer near-instant rewards, allowing shoppers to redeem easily, sometimes with as little as a few thumb swipes on a smartphone. This can mean a faster, more rewarding experience, which can effectively engage your customers and drive desired post-purchase behavior.
Top incentive solution providers deliver nimble SaaS technology, reward strategy and insights that allow you to adapt to consumer preferences and can aid in creating a positive customer experience. Whether your organization is large or small, it’s important to work toward designing a retail incentive program that provides a positive customer experience while still meeting business objectives in the rapidly evolving modern retail world.
By Theresa McEndree
VP, Marketing, Hawk Incentives
1. Rewards-Based vs. Discount-Based Promotions is a study by Ifeelgoods that surveyed 1,000+ consumers worldwide in September 2015.
2. “Let’s Make a Deal 2017” is an online survey of 2,001 Americans by Leger and Hawk Incentives completed between February 28–March 12, 2017. A probability sample of the same size would yield a margin of error of +/-2.0%.