This isn’t your grandmother’s incentive program anymore.
With rebates that zip to your online wallet with the speed of a splitting atom, coupon clipping services that allow you stockpile your favorite and most used items, and a plethora of other customer incentives and customer rebates, the priorities of incentive programs are changing almost faster than most can keep up with in this modern era of online data.
A well designed incentive program can create brand loyalty and keep the customer coming back repeatedly.
Some of the more popular and successful programs are:
These are often generated by coupons for dollars or percentages off the price. Many take advantage of coupon clipping services to enhance this benefit and create a winning feeling. The advantage to the retailer is that they can track the data of when and where something is being purchased. There are also online versions of coupon codes. Some can be searched via Google or found as a benefit of listening to a podcast. In fact, one of the most successful podcasts, EOFire, regularly has this kind of price reduction code on their site relating to the interviewee of the day. Use the Promo code “Fire”, chirps the lively host. Another flavor of this sort of incentive is “buy one get one”-type of offer. It encourages buying in bulk and multiples and sets up the psychological need to pick up ‘two’ every time a customer shops. “Take two, they are small” has a whole new feeling.
The sample itself (such as diapers and baby formula mailed to expectant mothers) is the incentive. A free trial of a small portion of something can create a future buyer. Often in beauty stores like Ulta or Sephora, small amounts of a product can be taken home and tried without risk, thus also creating the feeling that there is security and caring in the purchase cycle and that a company cares about the consumer’s risk factor.
Punch cards and points systems such as buy 5 coffees and get the 6th free. Or in the case of some retailers, try any product, regardless of price. “This one’s on us” has a feeling of camaraderie and loyalty that goes both ways: to the consumer and to the retailer, building a bond. Starbucks has created this with their ‘stars’, to great success. Even calling upon customers to get more, if they buy more on certain days, times or kinds of purchases. These loyalty programs include frequent flier miles and insurance discounts as well. Being part of a club, or a select group, even if everyone could join if they wanted has a kinship feeling
Bonus product with product trial
Test drive a car and get a free CD of music to drive by. Or the first 100 to test drive the new special car, will get a free flat-screen TV. This draws the impulse buyer as well as the deal seeker. Sometimes the bonus is related to the product, sometimes something else like a holiday. Come in and test drive a certain car and receive a turkey for Thanksgiving.
Free upgrade with purchase
This is related to the bonus product, but with a twist. Buy a cosmetic suite of products and get free lipsticks, rouge, and a cosmetic bag. Buy a propane grill and receive grill master sauce and a pair of tongs. This is the kind of package deal that can often cinch a purchase for the on the fence sort of buyer.
Bonus product with purchase
These are similar in nature to the free upgrade with purchase, but usually has some kind of price limit or variation. Buy $100 worth of hair care and get a free brush. Or with a $50 purchase get free shipping. This kind of incentive drives the customer to purchase just ‘one more thing’ to reach that benefit. This creates brand loyalty on the customer’s part, but enhances the overall bottom line for a business. If 100 customers buy $10 more than they had originally budgeted, then the company nets $1000 more in revenue. This quickly adds up when many customers are purchasing.
Trade up programs
This is common among phone carriers. Bring in your old phone, change to a newer phone, a different carrier and keep your old number. This has multiple benefits. A customer doesn’t feel robbed of the security and ease of the existing service or product but its vacuum space is filled with something better. For the retailer, it doesn’t have a complete sales pitch of having to convince a customer to purchase something new and different in their lives.
Options at time of purchase
A new car’s price can be a moving target for shoppers and this is a typical incentive in the vehicle industry. Most often in car, but also extended to boats, planes, and RVs. New-car incentives and rebates are discounts offered by an automaker to maneuver consumers away from the competition and make sure they stay loyal to a brand. They are also used when a certain model is not selling well enough, giving the option and security of choice. Buy an RV and get a choice of either a free generator, a free flat screen or a free extended warranty.
Sweepstakes and Prizes
Complete our survey and be entered into our free drawing or receive a coupon or gift certificate. This can be valuable to learn how the consumer thinks but if too lengthy or difficult it can create annoyance and sometimes hate for a brand. The “I’ll never use them again” syndrome of brand death. Used wisely by both parties it creates a satisfying win-win. With the advent of so many “quizzes” on social media this has been an up and coming form of incentive that meshes beautifully with the fun aspect of social media, and sharing. Quickly this can become viral for the right kind of survey.
Give us your contact information to receive our free white paper; take our survey and we’ll send you the industry-wide results. This is a wonderful way for someone to learn valuable content like a small pamphlet of old, but with an internet twist
Stop by our trade show booth and we’ll give you a free smartphone holder or a water bottle with our logo. Who doesn’t love a free gift? And this gets the customer to seek out the retailer.
A combination of these can be a winning brand strategy, even for a small business.