Andre Plessis, CEO Savings4Merchants

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Customer Incentive Programs
by Andre Plessis

In today's highly competitive marketplace, it can be a tough to make sales. Consumers nowadays are  being very smart. They are shopping for the best bargain and they all seem to want more than what they paid for. Every company needs an  effective and powerful marketing incentive programs that can make a significant difference and put you ahead of your competition.

If your sales have decreased because, advertising alone may not remedy your situation. But if your store or web site traffic has slowed down because prospective customers need an incentive to buy, you may want to promote your business through several efficient and cost-effective methods.

Customer Incentive Programs are one of the best ways to reward customers for their patronage. Vacation and travel incentive programs are among the most powerful methods to attract, motivate, retain clientele. Incentive travel primarily is used in programs to increase sales, purchases, or, in the case of employees, productivity or quality. Businesses who have used travel incentive programs have seen their sales increase at least 25%. Weather you are a small, medium size or large company you cannot afford to be without an incentive program.

What Do You Offer That Your Competition Does Not? You Must Create An Offer So Irresistible That It Would be Foolish For Anyone To Decline It!

Understand The Role Of Incentive Programs

The success of your company depends on whether consumers buy your product or service, and it is your main interest to motivate them to do so. Well-designed, promotions are powerful motivators: they are offers that consumers can't refuse. They can simultaneously provide the impetus to buy your products/services and reward the consumer for doing so.

Incentives are used to get people to focus both on your goals and what they can do to achieve them. Offer your employees, sales team, or distributors a valuable enough incentive, and they'll do anything they can to meet your goal.

Travel is used in business to recognize and show appreciation to people for their performance in a way that the recipients can never forget. It is used to create bonds between individuals and to communicate the organization's vision so that everybody involved is on the same page.

Incentive travel can range from elaborate international trips, cruises to small outings at a regional resort. What makes each program similar is the emphasis on achieving serious business goals.

Reasons To Implement An Incentive Program

Consider these great reasons to take a closer look at incentive programs for your business:

Online market researchers NFO said that almost 53 percent of e-consumers were willing to buy more online with some kind of rewards program and 47 percent would return to a specific e-commerce site if they knew rewards or loyalty incentives were offered. A mere 15 percent of those surveyed said such programs would not influence their buying decisions.

Incentive programs can increase performance by up to 44% in teams and 25% in individuals, Incentive, Motivation, & Workplace Performance, International Society of Performance Improvement.

Knowledgeable and attentive employees account for 80% of the reasons consumers feel satisfied, according to a PNC Bank Corp. survey.

Fewer than one in four American workers is working at full potential; half of all workers do no more than directly asked, and 75% of employees say they could be more effective in their jobs, according to the Public Agenda Forum.

70% of unhappy customers abandon vendors because of poor service, according to the Forum Corp.

A 5% increase in customer retention can increase lifetime profits from a customer by 75 percent, according to The Loyalty Effect, by Frederick Reichheld.

65% of executives believe that incentive programs using travel and merchandise are more memorable than those using cash; 60% of executives believe that sources of merchandise and travel are more helpful in creating an incentive program than are sources of cash, and

57% of executives believe that bonus payments are often regarded by employees as something they are due, according to the 1999 Incentive Federation Survey on Incentive Practices.

Identify The Specific Goals Of Your Incentive Program

Specifically define what your company wants to accomplish in terms of sales. Make sure that you can translate the goals into specific numbers measurable from one comparable time-period to another. Sample goals: Increase sales by 25% percent in the first quarter 2004.

Customer Incentive Program Announcement

Dear _______,

As a valued customer of (name of company), we couldn't wait to bring you the great news. This letter is to announce the incorporation of our new customer incentive program.

Starting on September 1st, a record of your account with our store will be maintained on a cumulative basis for a period of one year. Once your purchases have reached $200, you will be automatically entitled to a 10% discount on any order placed, including orders for sale items.

When your orders have reached the $500 mark, your discount will increase to 15%. A $1,000 accumulation of orders will entitle you to a 25% discount and once you have reached $2,500 you will receive 30% off all merchandise orders. We think it's a great idea and hope that you agree.

Won't you send us a purchase order today to get you started on your way? If you think of a good name for us to tag onto this new discount program, please let us know!

Formula for Success

The formula for success for any business is to attract new customers and get your existing clients to make repeat purchases. Here are three effective customer incentive programs you need to implement.

Purchases: This program is based on the number of purchases made by any customer. You could give away a free product or service to any customer that makes ten or more purchases. To make the program more effective you could require a set time period that all ten purchases must be made by a certain date. Example buy 9 coffees and the 10th one is FREE. Offer valid till September 1rst, 2004.

Dollar Amount: You can require a certain dollar amount be spent before the customer receives a reward. Tell customers if they spend over $100 they get a 25% discount on their next purchase. You can give them a gift certificate mentioning the 25% discount on future purchase.

Points System: Reward customers a point for every one-dollar they spend. Lets say customers can get a free TV for 1000 points. That means customers will spend more money and more frequently on your products or services to get enough points to get the free TV. The kind of rewards you give should depend on what your business can afford. Cheaper rewards could be gift certificates, coupons, clothes, restaurants, or movie passes. Expensive rewards could be jewelry, vacations, electronics etc..

Attract New Clients: You should use incentive programs to attract new clients as well. You could tell them that when they purchase from you they automatically enter to win a TV, trip, $250 Gift certificate at Macys, $1000 cash etc.. One of the most successful incentive programs is travel as vacations are always memorable.

Incentive Travel Programs