Customer Incentive Schemes

The retail sector has cottoned on to the idea of incentive schemes to hook in new customers and keep existing ones buying with them.

The Boots advantage card and Tesco Clubcard are two incredibly successful examples. They’re easy for the customer to use and offer financial rewards for staying loyal to one retail brand.

When we look at the benefits that incentive schemes seem to offer to the provider, it seems foolish to not offer some sort of loyalty system to your customers, whatever the industry.
Incentive schemes can offer:

§ A competitive edge
§ Increased repeat business
§ Expansion of your customer database
§ Increased brand awareness

But can such an idea be transferred into other industries?

It seems that the answer to this is unclear. In business-to-business interactions, many organisations are unable to accept incentives or gifts for loyalty due to the sector they work in.
In addition to this, the majority of people would say that it is the quality of service that keeps them going back to the same company, rather than rewards.

If a scheme appears complicated, understandably, it would mean that customers are much less likely to participate.
The Boots and Tesco card schemes prove extremely popular partially due to the simplicity: the customer does not have to keep track of their reward points and the retailers lets them know how to use the points effectively.

The main issue to look at when introducing incentive or loyalty schemes would be whether or not your customers are interested in receiving rewards for their loyalty and would it really benefit your business sector?

We'd love to hear your opinions on this and reasons why you signed up for certain incentive or loyalty schemes.