Power of Perks...
Power of Perks...Going Beyond Spiffs & Points
How do you differentiate your reward program?
The component that many brands focus on within their reward program is the spiff. Competing against competitor reward programs can be a costly battle. An impressive spiff amount can certainly make a splash. It will generate a lot of buzz. That buzz will certainly have an effect and units will move. It will also have an impact on your reward budget. That can be a strategy when you are looking to move inventory and gain marketshare within a specific channel partner.
Beyond raising spiff amounts, what else can you do to get your program noticed and increase loyalty?
Perks! Perks should be added to the reward mix in a strategic way. What are perks?
If you travel often, you may have an airline that you fly frequently. The more you fly them, the more miles you accumulate. Those miles not only earn you free flights, they provide you perks. The ability to move up boarding groups or be placed on the waiting list for an upgrade sooner. Those are perks offered by the airline to reward you for your loyalty.
Retailers are adding perks to their most loyal shoppers. These perks include early access to special promotions, invitations to special events, early access to product launches, free shipping or personal shoppers. Macy’s gets half its $24.8 billion in annual revenue from 10% of its customers. Nordstrom says loyalty members spend four times more than nonmembers.
In channel programs, the 80/20 rule also applies. How do you focus on your most loyal partners? How do you share shift within your other partners to increase their sales?
Perks can be used in a strategic way when applied to a channel incentive program. This goes beyond points and dollars. It’s another layer added on your program. Karrot can assist you in analyzing your program and developing a strategic approach mirroring your culture and your goals.