Rebate programs and sales incentives, when robustly supported by a powerful consumer data collection apparatus, can be highly effective across a number of internal and external business applications that are connected to income and profit margins. Sales incentive programs can increase sales volume, contribute much to increasing activity flow through existing sales channels, and strengthen a company’s relationships with consumers.
The following information provides some insights into the particular methods innovated by Incentive Insights. The company has reinvented the concept of rebate and customer incentive programs, by offering much more flexible solutions for business owners than provided by traditional rebate management programs, and by tapping the power of data to help businesses drive more sales traffic and increase sales closing rates.
About Company A
Company A is an importer of small and large appliances and other consumer electronics from Asia. The Company provides a wide variety of popular as well as lesser-known consumer electronics brands, including televisions, home sound systems, telephones, and other White Goods.
The company has grown steadily over the past 25 years and now operates globally through its network of distributors and services providers throughout Latin America.
As a private company that sells to only a regional retailer and a limited number of online retailers, Company A is a medium sized company with between $1 million and $50 million average annual profits.
Company A has grown steadily over the years since implementation of its Incentive Insights rebate program. The retailer has expanded the number of product lines it carries, and the company has expanded to import a greater volume of products into the US.
The Incentive Insights Approach
This client was informed by the retailer that they had to start offering rebates if they wanted to continue to sell products with the retailer. They had an immediate need for these services. This is not an uncommon starting point for clients within this industry.
Company A’s objective was to comply with retailer’s requirement to offer rebates on specific products or categories, increase sales to existing customer and increase sales to first time customers. The core strategy of this approach necessitated a robust email marketing mailing list and strong social media connections.
- The rebate program actively gathered and validated email addresses, to build a list of customers that could receive targeted sales and new product announcements.
- A fully customized solution was implemented for Company A for maximum effect.
- Fully customized reporting from the incentive program management was provided, as was also necessary to reflect the progress of the customized incentive program in increasing activity around the rebate program over time.
- Incentive Insights executed an easy program setup, which eliminated uncertainty for Company A, as a business that was new to incentive programs.
- Rebate program experts tested various funding amounts for Company A’s lower-purchase-price products, and used data to help management find the proverbial sweet spot. Customers quickly began showing interest, and Company A started increasing unit sales.
- Incentive Insights implemented a system of recording information, including using retailers’ receipts, to clearly identify sold items as open-box purchases. Those items are blocked from rebate approvals, unless Company A grants permission at its discretion.
- The rebate management team captured information about item deliveries, and it employed a separate logic set to validate those purchases for rebate purposes. Support staff were trained simply to use a different set of support rules for delivered items.
What Were Company A’s Results After Hiring Incentives Insights?
Company A’s main goals have been, and continue to be, to provide its industry’s best products and prices and to achieve complete customer satisfaction. Since beginning collaboration with Incentive Insights, Company A has:
- Increased product lines sold by its retailers.
- Grew their business to become a top category sales leader. Prior to starting their incentive programs they were in the bottom tier of sales within their category.
- Grown to provide multi-product incentive offers year-round, and on all minor and major retail holidays.
- Marketed via routine ROP (run-of-paper ads).
- Marketed via other special ad flyer and various other media marketing “events”.
Incentive Insights reinvented the rebate industry’s traditional approach to rebate program design and execution. By applying its cutting-edge systems for data management and customized incentive programs, in order to provide a customized incentive solution to address Company A’s unique business needs, the Incentive Insights team has:
- Cultivated long-term sales for Company A.
- Established direct connection between the client and its customers.
- Increased Company A’s breadth of marketing exposure and effectiveness through use of social media and email marketing.
- Captured and summarized valuable detailed consumer demographic and psychographic information that allowed Company A to parlay actionable data into an increasingly valuable asset—increased sales results.
- Provided detailed, user-friendly data analysis and reporting, to promote greater effectiveness of Company A’s overall marketing program.
Data Collection and Quality Analysis
Consumer information was amassed and allowed to build upon itself for use to help Company A better understand its customers and sales channels, a process which took its incentive management solution to a new level of efficiency and profitably.
Incentive Insights data scientists collected the best quality of available data, and provided Company A management with interpretations and consumer market insights that were easy to understand and apply to their general marketing strategies going forward.
During execution of the rebate management program, Incentive Insights experts closely monitored each step of the implementation and operations processes, and addressed issues before they could become significant problems. Some examples of these issues include, but are not limited to, UPC typos on product boxes, sales staff making illegal substitutions for items, and sales staff providing wrong rebate instructions to customers.
The incentives program team managed the rebate system and processes to ensure that relevant data was date and time stamped, and that all customer interactions were documented.
Raw data was provided to Company A management weekly, in addition to frequent analyses and formal reporting.
Company A was encouraged to review data and ask questions about results and the logic of interpretations provided.
Advanced Analytics and Reporting
Generally speaking, Incentive Insights expertly prepared analytics and reporting emphasizes actionable intelligence that can be immediately used to take the guesswork out of marketing strategies. Consumer information interpreted from real-world data was used to help Company A improve its marketing strategies.
Incentive Insight’s data scientists analyzed and interpreted Company A’s data for their marketing management to help them fully understand how to best use the captured data.
- Demographic Data — Information on age, gender, ethnicity, income levels, education, family size, and so on
- Psychographic Data — Consumers’ interests, values, preferences, personality characteristics
- Behavioral Data — Customers’ purchasing behavior, frequency of purchases, times of purchases, etc.
- Geographic Data — Geographic regions and local areas where the majority of Company A’s customers were purchasing its products
The Incentive Insights Performance Policy
“We recognize the incredible potential represented in the data captured through consumer rebate programs. This data enhances the value not only in the rebate, spiff, and jobber programs themselves, but also in the value of the very products that are being promoted.” — Incentive Insights
Incentive Insights’ transparent approach focused on Company A’s specific business needs and on the general need of a sales business to build lasting customer relationships. In that interest, the rebate management team emphasis was on:
- Accuracy — The state-of-the-art process of digital solutions guaranteed that Company A’ rebates only went only to active email addresses. And, social media rebates were sent only to verifiable customer accounts. This level of accuracy improved the overall effectiveness of the consumer incentive program, which has more greatly increased Company A’s revenues throughout the program.
- Efficiency — Incentive Insights’ customized digital solution for Company A increased both speed and accuracy of the incentive program. Like most modern consumers, Company A’s customers demand quick delivery. Incentive Insight’s customer services specialists streamline the rebate fulfillment system, ensuring that customers’ questions are answered promptly and that every rebate is promptly fulfilled. Customers’ great experience with Company A’s rebate handling was an enhancement to Company A’s already strong reputation with its customers.
- Innovation — Reliance on the cutting-edge technology utilized by Incentive Insights allowed for accuracy in high-volume data capture along with automated analyses, at costs that were affordable for Company A.
Making Company A’s Rebate Program Profitable
The first order of business was to ensure that the rebate program would definitely be profitable for Company A. Price concessions were created that were clearly profitable in Company A’s sales growth environment, while at the same time not increasing the cost of the company’s sales volume.
- Calculated the profitability of an incentive program —Assessed the added customer incentive programs to ensure intended revenue growth would actually be achieved.
- Used automation to determine program profitability —Company A used rebate submission data to extrapolate sales data from confusing stock reports supplied by the retailer.
- Implemented rebate modification strategies —Put an experienced team in place to adapt the program as necessary over time, to meet Company A’s and its target customers’ needs.
- Managed customer expectations —The rebate management team ensured against launching a program that ultimately could bring Company A’s customers to expect a rebate on every purchase they make. Company A has year round lower dollar rebates on their important products as opposed to all of their products. They use special sales, holidays, and retail events to provide maximum benefit during high consumer traffic periods.
- Adapted the rebate program in a timely manner — Shifted strategy as necessary to secure higher profit potentials:
- Evaluated what was working.
- Evaluated what wasn’t working.
- Determined what products customers were most likely to buy.
- Determined which products were generating the greatest profits.
- Offered incentives to boost the sale of Company A’s most profitable product/services.
- Facilitated brand awareness and engagement — Collecting consumer data allowed the rebate management team to track Company A’s customers’ behaviors, affording its marketing professionals much sharper focus in their strategic planning.
What Were the Challenges?
Developing an appropriate strategy to ensure that the incentive reached its full potential, while maintaining and increasing Company A’s profit margin through use of the incentive program required overcoming several challenges inherent in its industry:
- Finding just the right range — Locating the pricing margin within which rebate awards could be effective on very low-cost merchandise. (For example, determining the number of dollars that could be rebated on a products priced under given thresholds.)
- Accommodating Return Policies — Even today, as Incentive Insights continues to work very successfully overall with Company A, managing open box merchandise for purposes of various customer incentives programs continues to present certain ongoing issues. The company has very relaxed return policies. So, capturing and rejecting every rebate in instances of open box merchandise continues to be a minor challenge.
- Accommodating Delivery Policies — Company A provides upgraded delivery service for an additional cost to its customers. That service involves disposing of product boxes for customers. This results in occasional instances in which a customer cannot provide some bits of required documentation for their rebate, due to receiving the delivery service.
The Incentive Insights Program Design and Implementation Principles
The Incentive Insights team applied the rebate management company’s established principles of its solution for Company A. Understanding that a consumer rebate program can only be as successful as the quality of its planning permits, the program design and implementation team used the following checklist of fundamentals for a successful incentive program:
- Clearly defined goals for the program.
- Clearly communicated the details of the program to all stakeholders.
- Designed a compelling incentive offer.
- Kept all rules very simple and clearly stated.
- Provided easy access to a very simple system for redeeming rebates.
- Marketed the consumer rebate program effectively to target consumers.
- Collected relevant data, and use it strategically to improve customer relations and marketing.
- Measured success throughout the life of the consumer incentive program.
For More Information
For additional information about this case study, or about the benefits of employing customized incentive strategies for your current or prospective customers, clients, upcoming marketing campaign, or for your employees, contact Incentive Insights Sales and Information at (866) 597-7539, or Client Support at (914) 948-2750. Ask to schedule an appointment with an expert, to discover the steps to making your rebate program profitable.