Promotion tip 3. Rewarding
Do reward only customers who deserve the incentive ...
sounds obvious?
At the end
of your promotion, there will be four customer groups:
- Those that
knew of the promotion and increased their purchases to earn the
gift.
- Those that
knew of the promotion and didn’t increase their purchases
enough to earn a gift.
- Those that
didn’t know of the promotion, but increased their purchases
enough to earn a gift.
- Those that
didn’t know of the promotion and didn’t increase their
purchases enough to earn a gift.
Only group
1 should be rewarded. This is the only group that was motivated
by the incentive to buy more.
Too many companies reward customers
from 2 or 3, or all 4 of the customer groups! Somehow they justify why they
should give the customer the incentive even if they didn’t
deserve it. All this does is tell the customer that they are “special”.
This customer realizes that he is in the group who can continue
to buy less but expect more. If you design your rules correctly
you won’t have to reward the other groups. This can
be the deciding factor on whether a promotion is profitable or unprofitable!
After the inception
of the incentive promotion, include only those customers who are
truly interested in participating, not those who aren’t.
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