How To Create a Cost-Effective, Measurable Incentive Program Using Gift Cards

As the business downturn continues and companies with tightened budgets struggle to find ways to generate growth and profits. Incentive Programs are enduring.

A recent article in Motivation Strategies magazine says, "Despite an initial hit when bad times set in, incentive programs are essentially recession-proof. This helps explains why savvy companies turn to incentive programs to drive business growth, even while cutting budgets for other business development functions."

The Motivation Strategies article points out five fundamental reasons why incentive programs, unlike other sales and marketing strategies, withstand economic downturns:

1. Low fixed costs, variable costs driven by performance, high potential return
   
   
2. Ability to effectively target audiences (no pay and spray)
   
   
3. Relative ease of measurement
   
   
4. Flexibility
   
   
5. Potential for both short-term and long-term results

So, how do you put together a cost effective, results oriented, measurable Incentive Program? Make merchant specific gift cards the primary reward.

• Gift cards are still the number one choice of program recipients. Despite the current retail environment, most issuers are financially stable and eager to serve your recipients.
  
  
• The best program should include a selection of 8-10 merchants that offer both everyday and special occasion needs to the recipient.
  
  
• Move your gift card price points downward to allow your recipient to claim a reward quickly and often. The best incentive is one you can actually claim.
  
  
• Reduce your costs by buying your gift cards directly from the Corporate Gift Card Departments of the issuing merchant. Most merchants will offer discounts for bulk purchases. Do not go to a store.
  
  
• Be very clear about the goals of the program and the activities you are planning to reward. With time at such a premium employees, customers, and prospects need to know exactly what they can expect from you and what you expect from them.
  
  
• Communicate the program clearly and consistently. Once is never enough. If your program is going to run over an extended period you need to consistently promote it with enthusiasm.
  
  
• Celebrate the accomplishments of the employee. Studies show that the thing people want most is recognition. Combining the two will create a very powerful program.

As companies make the shift from mass marketing to target marketing, they will ultimately turn to incentive programs as a primary solution rather than a secondary or complementary tool, for all the reasons outlined above. Each time an organization replaces a mass marketing technique with a one-to-one strategy such as an incentive program, it will realize a ripple effect of benefits -- engagement, satisfaction, behavioral changes, etc. -- that will sustain itself over time.

To learn more about Motivation Strategies magazine visit www.motivationstrategies.com.

To download a PDF of the complete white paper, visit "Why Incentive Programs Endure Recessions."