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5 Reasons to Incorporate Consumer Rebates into your Incentive Program

5 reasons to incorporate consumer rebates in incentive program

When it comes to increasing channel revenue, OEMs look to incorporate consumer rebates into incentive programs to drive motivation and loyalty through two key parties: channel partners and consumers.

A good indirect incentive program is designed to motivate more channel selling behaviors by partners like dealers, distributors, and contractors. Consumer rebates are designed to motivate more purchases by reaching out directly to consumers with attractive purchase incentives. Both strategies ultimately lead to the same end goal of generating more sales of your product over the competition. But which is the right model?

Some of the most successful channel programs incorporate strategies and programs geared towards both partners and customers. That means a channel incentive program that motivates dealer sales behaviors may be paired with a consumer rebates that motivate consumers to complete purchases. Thus, a concerted campaign towards each of the parties has the most potential to lead to a sale.

If you look hard enough, consumer rebates are everywhere. It’s easy to notice more broad stroke branding and advertising initiatives that earn brand equity like commercials and billboards. But, when looking through enough products on a store shelf, like electronics and appliances, you begin to notice OEM efforts geared toward winning brand loyalty at the last few feet of the sale. This could be a rebate promotion on a product’s packaging, or a separate flier in or around its store placement. 

Consider this scenario:

A prospective customer walks into a hardware store to find two appealing lawn mowers, both around the same specs and price points. One product offers an attractive rebate after purchase while the other does not offer any rebate at all. The incentivized product might push the prospect over the fence into their first step of becoming a loyal customer.

Strategically planned rebates allow your products and your brand to stand out among the noise in a prospective buyer’s mind. This provides ongoing benefits like repeat purchases, a closer bond, and customer referrals to friends and family. While the sacrifice of some margin could be a tough pill to swallow, consumer rebate strategy avoids alternative costly endeavors like expensive advertising initiatives with unclear performance or diminished perceived value of your products by marking down prices with predictable discounts.

Here are some of the main success factors associated with incorporating consumer rebates into your overall reward strategy:

Boosting Brand Equity

Consumer rebates do more than offer a consumer money for a purchase. A brand leverages an opportunity to give back to a customer who shows loyalty, thus creating a stronger bond between consumer and brand.

Does the public have a positive view of your company? Do buyers recall your brand before many others? These are all important questions to consider when considering brand equity. Rebates can often invigorate brand value because they speak directly to the market, those looking for discounts, and even the hyper price-sensitive buyer group – all of whom have the potential to increase exposure and brand equity.

Encouraging Repeat Purchase

Consumer rebate programs help to instill the affinity and loyalty that keeps customers returning for future purchases. But beyond good branding, specific purchasing behaviors can be influenced based on the type of rebate implemented. More generous rebates can be applied to products that are more conducive to repeat purchase, such as power tools that require periodic battery replacement. 

No matter the type of rebate chosen, like tiered, value, volume, percentage, instant or mail-in, OEMs often notice interesting and predictable patterns of consumer behavior. This offers valuable insight that can take an incentive program from good to great. For example, seeing rebates influence repeat purchase for a given product may lead to infusing more rebates into SKUs in similar product families.

Collecting Customer Insights

Selling more effectively to customers starts with gaining a better understanding of who they are, what they like, and what their pain points are. Insight into the identity behind an anonymous sales transaction helps OEM brands gather valuable intelligence into your markets served.

Analytics for Rebates
Dive Deep into Analytics

Since rebate programs involve the submission of a proof of purchase for validation and payout, there is an opportune time to collect more actional details of who made the purchase. Some programs add more detail to their claim forms outside of the ancillary details for claim validation. This could include demographics like the customer’s geographical location, or behavioral inputs like whether they’ve made a purchase from you before. Other programs may incorporate data collection with an enrollment process to participate in online rebate submission programs for the opportunity to collect customer details. 

Program reporting helps to centralize rebate claims and their detail, visualize and synthesize information, and identify valuable trends and other insight.

Building a Bond

Giving back to customers for their loyalty alone helps to bond the customers to your brand. Think about how nice it feels to see that $50 Visa card in your mailbox after you bought that microwave at Best Buy, especially after your kid accidentally put their fork in the microwave and ruined the old one. This means that customer rebates create a meaningful experience outside of the initial point of sale. 

Both online and mail-in rebate programs create a valuable bond, an online rebate portal for customers to visit and submit claims creates a lift in customer interaction and higher levels of brand exposure to logos, colors, and other facets of your organization or brand. Online programs also allow for simplicity and ease of use with seamless submission for the user, leaving them a happy customer.

In WorkStride rebate programs, even the prepaid debit card received by the customer can contain  brand value with a company logo and branded packaging.

Take More Control Over Revenue Achievement

Finally, Rebate programs help brands gain more of a handle over sales activities. Consumer rebate programs often lead to predictability in campaign performance. Marketing and Sales administrators gain valuable oversight in rebate tactics and operation, like how many rebates are running, how often, and how and what they are incentivizing. As a result, revenue objectives can back up into the rebate strategy to navigate sales performance to hit goals. 

For example, consider a scenario where a certain product family is getting backed up in inventory causing a strain on logistics and costs. The glut can be actionably driven down with incentives and rebates generating more sales for the oversupply of SKUs in a shorter period of time. 

WorkStride is a leading provider of performance incentive programs for leading brands around the world. Our blend of technology, services, and support helps to power our enterprise OEM clients to exceed objectives of their consumer rebate and incentive programs and — earning engagement, mindshare, performance, and ROI. Contact us today!

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