Incentivized marketing has become one of the most popular forms of internet marketing. A large majority of small businesses use incentive marketing companies as part of their overall marketing strategy. It allows a business owner to get more customers without having to spend additional resources on other advertising strategies.
The basic definition of incentive marketing is "the use of reward-based incentives to encourage a person or group of people to do something desirable". Incentivized purchases help businesses gain more customers and build stronger relationships with existing customers. Incentive-based marketing also helps businesses make better decisions due to the many variables that influence consumer buying decisions. For example, some customers would be happy to receive discounts if they purchase a certain amount of goods from a business, while other customers may not be willing to pay the price for that discount.
Many businesses use incentives in incentivized marketing programs to increase customer loyalty. Loyalty programs can be structured to include various offers or rewards including cash back, discounts, free services, or other privileges that make it possible for customers to turn from new customers to long-term clients. Some businesses use incentives to encourage customers to order a large number of products from the same business and to join a loyalty program. These programs may also offer incentives for customers who use particular services or choose to purchase a certain amount of goods from a business each month.
Incentivized purchases are often used by businesses to motivate employees to work harder and increase productivity. An employee that sees that they are rewarded for every sale will be more motivated to offer higher quality service to their customers. Likewise, a business owner may reward employees with gifts or free products as a way to build retention in the workplace. By offering gift certificates, consumers are more likely to continue using a company's services.
Not all incentives offered in an incentive marketing program should come from a third-party source. An important part of any incentive marketing program should come from the business owner himself. This is true for several reasons. First, the business owner has the knowledge and the power to control what incentive product he chooses to offer his customers. If he chooses to offer a product that he believes his customers will be more interested in than others, he has a greater chance of getting those customers into the store. Secondly, the business owner has the ability to monitor how effectively the incentives being offered are being used by his sales staff.
A well-constructed incentive marketing offer should get customers involved in some way. The best way to do this is to offer a product that is valuable to the customer. For example, if a business offers customers a free laptop on a subscription that will last them a year, the customer may be willing to pay for the laptop even without having to shop at the store. Similarly, if a service allows customers to get a discount on a yearlong maintenance plan, or if the service allows customers to register their new credit card with a discount, the customer may be more likely to become more involved with the incentive marketing company.
Incentive marketing offers should be specific to the needs of the customer. For example, a service such as cleaning and lawn care could use an incentive marketing offer such as a dollar off a two-hour cleaning service when a home is maintained with the service. Such an offer is far more compelling to homeowners than a discount on a per-job basis. If a homeowner were interested in getting a discount, he would be far more likely to make a house clean appointment when he has a free hour.
Any incentive marketing system should only be implemented when it actually makes sense for the company to do so. Many companies simply provide incentives to customers in order to increase sales. However, doing so can create a bad reputation for the company, especially if the customer isn't treated fairly. A successful incentivized program should create real value for customers while also increasing sales. Incentivized programs should be examined closely before being implemented, in order to ensure they are creating real value for customers before the company adds them to its marketing campaigns.