Are you in need of a solid incentive marketing program? Its important to understand how incentive marketing works before you decide to implement one. This is an aspect of your business that will help you know what youre getting into and what the results will be. Heres what you need to know.
An incentive marketing program is simply a way to reward loyal customers. It doesnt matter if they have made a purchase in the past or if they are likely to buy in the future. There are two ways in which the rewards can be distributed to your customer base. The rewards can be achieved by the consumer themselves, either as a direct payment or in some other indirect way such as through the use of their credit card.
Now that you understand what incentive marketing programs are and how they work, its time to look at how they can benefit your business. There are two basic types of incentive marketing programs. They can be presented in a direct payment model or a payment-by-results model.
In a direct payment model, the reward is awarded to the consumer based on the extent of their purchases. Incentive programs are given directly to consumers. This usually occurs when the consumer makes a purchase. The consumer can use the funds to pay for their next purchase. For example, you might give a customer who purchases a DVD or video an incentive if they join your community service program or return their good (used DVD) for a refund.
The consumer can then take the money they received in the form of their reward and use it to pay for the item they bought. However, some companies offer incentives to only certain customers. They use this method to reduce costs and increase returns of sales.
In addition to direct payment methods, there are some incentives that can be achieved by a company without the requirement for a cash payout. For example, businesses have incentive programs where products are given away as a reward for joining their programs. These programs usually last from three months to one year.
With any incentive marketing program, your company needs to consider the customers level of loyalty. The customer must feel like they are truly rewarded for what they purchase. Also, the reward must be one that the customer will use on a regular basis. Some examples of rewards include:
All of these rewards are items that a customer would use on a regular basis. The majority of these rewards are items that customers purchase anyway, therefore, they will enjoy using them.
When implementing an incentive marketing program, you should be sure to present your rewards in a way that is most beneficial to your customer. Sometimes it may be more effective to offer discounts or rebates to customers who become part of your incentive program.
If you choose to do so, make sure to keep your incentive marketing program simple to understand. Explain the reward clearly to the customer and let them know why they are getting it. Use pictures and written descriptions to ensure that the customer can grasp the reward they receive.
An incentive marketing program is a great way to reward loyal customers. However, it is important to understand how incentive marketing programs work before you choose to implement one. Incentive marketing programs can increase your profits dramatically if implemented correctly.
A good incentive marketing program should consist of a reward program and an incentive program. If you put the right incentives in place, you will be able to grow your business in a very short period of time. The incentive marketing program you choose should be one that you can implement with minimal training and make sense to your customer base.