Combating Recession: The Time for Incentive Progression
July 01, 2008
By Dana Slockbower
Call it what you want—these are rough times. Recession or not, people are making changes to their daily routines to save everything from the environment to a few bucks. The question is, are these sacrifices cutting your brands from consumers' things-to-buy list?
We're all feeling the pinch. Airlines are charging for checked bags and the price on everything from diapers to table salt is rising. Corporations can no longer eat the rising energy costs, and it has to be picked up by somebody: the consumer.
Inspiring Incentives
To help consumers look beyond the price tag, companies have to come up with creative ways to increase brand loyalty—and nothing drives business like incentives. Incentives are critical during economic down times. If nothing else, incentive programs should be strengthened in times like this. Why? Because consumers are paying an arm and a leg for necessities like gas and food, making them more and more conscious of what they're spending on other "luxuries."
Offering incentives can help guarantee consumers stay loyal to one brand over another. But doing it right takes time, research, and know-how. It's important to know the target audience, and to know what it takes to motivate them.
Take something as simple as a bottle of soda. There are plenty of different brands to choose from and they all cost about the same. What can one brand do to create a loyal customer? Reward them. The leading beverage companies are putting points under the bottle caps, which can be banked and redeemed for merchandise rewards—the "if you stick to one brand, you'll earn points faster" philosophy.
Eyes on the Prize
In order for this approach to be successful—and generate continuing consumer participation via point increments—the reward offerings must be aspirational and attainable. By offering a range of merchandise rewards that includes everything from golf clubs to designer handbags, trendy earphones and exercise equipment, the same incentive program is now appealing to an unlimited audience.
But with an unlimited audience comes some more curves to take into consideration. Since your audience now really is unlimited, it's important to remember that the average American household belongs to a dozen loyalty programs. What will make yours better then the rest?
To ensure success, your incentive program must encompass three elements: communication, motivation and reward. It's important to get the word out to your target audience clearly and efficiently. A confusing program is just as detrimental as one that isn't marketed well. Once the program is properly communicated, the goal set for participants must be realistic and achievable. Giving points in increments of two, then offering rewards starting at 150,000 is de-motivating at best. Finally, offer great rewards. People want rewards they can use. Logo-ed pens and mugs have their place, but not when you're trying to build brand loyalty during a recession.
So if you want to make consumers' short lists, keep these things in mind. Your product or service may very well become one of those "luxuries" they can't live without.
Dana Slockbower is Director of Marketing for Rymax Marketing Services, Inc., the largest manufacturer's representative in the incentive industry. In her 6 years with the company, she has proven herself as an extraordinary leader in project management and event management. She focuses mainly on creative campaigns and team motivation, especially within the incentive industry and its various vertical markets. Slockbower received her undergraduate degree in Marketing and holds an MBA in Corporate Communication.
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