Companies use incentive programs for a variety of reason.
They want to change customer behavior.
They want to attract new customers to their products. These customers later become loyal customers and provide the company with a continual flow of revenue.
They want to reward loyal or long time customers. These are the companies' bread and butter and companies will go out of their way to see that they are kept happy.
A company can use and incentive program to gather information about their customers. The most successful companies are the ones that have an accurate, up to date data system that includes information about their clients.
A successful customer incentive program will increase customer traffic to the company's stores and websites.
The first thing a company should do is decide what type of incentive program they would like to offer. Popular ones are travel and vacation incentives especially ones featuring exotic locations or events, cash bonuses and customer rewards.
When a company decides to use an incentive program they need to decide if a direct incentive suits their company or if their needs would be better suited with an indirect incentive program.
A direct incentive program is one where the customers receive the incentive directly from the company. This type of incentive is normally used when a company decides to offer something that relates directly to the product they sell. It is normally seen in the form of coupons, rebates, buy get one free specials, and product discounts.
The other incentive program some companies use is an indirect incentive. This type of incentive program is used when a company goes out side the company and involves a business that is not related to the product they sell.
They keys to a successful company incentive program is to have a good management. Create a committee of dependable employees whose soul responsibility the company's incentive program. Decide which of your employees has the best qualification and make them the program coordinator, this will be the person that answers any questions and signs any necessary paperwork. Establish a budget. Get your employees involved. Employees are also customers; they also have a vested interest in making sure the product sells. Keep tabs on the program. You don't want to find out that it's not the success you thought it would be when's its too late. By checking on the project regularly you will be able to make necessary adjustments.
When running a company incentive program be prepared for things to go wrong. Murphy's Law is always ready to wreck havoc on the best laid plans. When it comes to company incentive plans shipments can run late, companies can go belly up without warning. Marketing can fail. Be prepared, have a back up plan and a plan to back up the back up plan.
With a lot of forethought, a reasonable budget, and the right management a company incentive program will boost sale figures, improve customer loyalty and increase product exposure.
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