4 Things to Remember When Selecting Rewards for a Loyalty Program

The biggest make-or-break parameter of any campaign is the perception of the rewards. Not selecting proper rewards will be a sufficient condition for the failure of any program. The following are a few pointers that should be kept in mind while selecting the rewards that go with any campaign. They are listed in the order of importance with the first being the most important.

  • Fit to the TG

This is a no brainer. Any reward’s perception varies vastly among different demographic and economic groups. An Amazon Kindle will probably be useless to an uneducated trader while an iron box will probably be useless to a sophisticated architect. Understanding the target group and customising the reward list basis their feedback is the best approach to tackle this. For lower value payouts however, we have learnt through experience that the best options are cash equivalent instruments such as Wallet balance, Mobile phone recharge, Gift card are the best options.

  • Choice

Irrespective of the research done to find rewards with high appeal it is important to remember that one reward will never fit all. It is always good to give the winner more choice so that they can select what they want. One common mistake done in the pursuit of running slab based schemes is to have one reward per slab. When the Salesperson is trying to sell the campaign, the conversation ends immediately if there is no appeal in the assigned reward to the individual. Having a huge catalogue of items and including gift vouchers of retail chains or e-commerce companies is one way to ensure that everyone finds something of useful to them.

  • Ease of logistics

The best of the rewards end up creating more heart burn than loyalty when the logistics aren’t handled properly. Complexity of logistics is more often than not an inherent attribute of the reward itself. An e-Voucher has no cost of logistics while automobiles or travel packages have high complexity of logistics. Smaller scale programs can afford to go with more experiential rewards with complex logistics but for mass scale programs, it is always better to pick rewards which are easier to ship across the country. With the spurt of internet based product and experience providers the complexity of logistics of all rewards has come down in the past few years. But among the list of possible options, it is important to strike the balance between more experiential rewards vs complexity of logistics.

  • Perceived value to Cost margin

This parameter, while important, is unfortunately often the only parameter considered by many campaign designers. While it is important to get the best possible savings, picking the wrong rewards will not only antagonise the winners but will also result in campaign failure and loss of brand value. Many companies, especially those with heavily staffed procurement departments, fall into this trap and end up selecting the wrong rewards and wrong vendors.

You can keep this pointers in mind the next time you design your reward campaign but if you need assistance of the experts in business, do leave your details through the form in the link and let us select the right rewards for you.

Topics: Loyalty Programs

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