Best Practices for Creating the Right Rewards Program that Drives the Right Results


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When done right, a high performing incentive program will provide the right reward to the right person and drive the right results. However, because each audience and organization is different, reward programs contain variable components. There isn’t one off-the-shelf program strategy that will work for every business, but there are some key considerations to weigh when speaking with a potential reward provider and designing a reward program strategy. Taking these five practices into account will help in architecting an effective reward program:

Understand your audience and define your goals
Reward programs have been around for a long time, but their value remains. New technologies and connected lifestyles are reshaping the ways that organizations can successfully engage and motivate consumers, sales partners and employees. With this in mind, businesses are challenged to create reward programs that are unique and personalized. Each business will have a variety of reward program participants and preferences. A millennial in sales might prefer a specific retailer’s egift, while customers might want a physical gift card. The key is to create meaningful segments that provide separate rewards to effectively engage with or motivate each group.

Offer varied reward options
An effective program must offer reward choice for participants in order to satisfy a potentially diverse recipient group. Reward preference can even vary with the denomination and program type. Customers have different reward preferences, including physical and digital rewards, a wide range of denominations, varying delivery methods (electronic or mail delivery), etc. It’s important to keep in mind that customers’ preferences also change. The 2015 “Rewards-Based vs. Discount-Based Promotions” study by Ifeelgoods found reward-based promotions have been shown to outperform discount-based promotions by more 42 percent, but that could change tomorrow. Your reward program should offer enough variation to evolve with your program participants.

Select a user-friendly platform

There is no reason why a reward program should be anything other than seamless and user-friendly. Select a reward provider that is able to offer an extensive suite of customized and off-the-shelf, web-based applications that allow for ease of program administration, communication, ordering, tracking and integration into third-party systems. You should also have access to strategic account managers who guide, support and help you achieve your business goals.

Decide how you will communicate the program
Develop a communication plan to support the roll-out, implementation, and maintenance of the program. Depending on the size and geographic reach of your organization, keep in mind that there may need to be separate messages for audiences in different geographic locations, different departments, etc. For example, if you’re trying to reach an older demographic that doesn’t frequently use email, they will likely miss a reward that is delivered digitally. Also, consider the frequency and channels for program communication. There isn’t one right answer because each audience will have different preferences.

Conduct ongoing review of the program
All of the available options for personalization can only be effective with regular monitoring of the program and reporting on progress. To optimize the program, organizations must create benchmarks and define success metrics to continuously measure against. Are certain rewards seldom used? Replace them with something that could be more valuable to the customer. Are desired behaviors not being seen after text communications? Maybe email would be more effective.

It pays to design a well-thought out reward program. Thinking through these practices and getting the right rewards to the right people can help you shape the best reward program strategy to meet your business goals.


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