Why Award Programs Work

While it’s not a recent innovation by any means, there’s no denying that the concept of the customer loyalty program has grown exponentially in recent years. Due to there being so many avenues available for businesses to communicate directly with consumers, every business and brand has tried to implement their own awards program in the hope that it will influence consumer purchasing decisions.

But do these programs really work? The short answer is yes. Businesses that implement awards programs often notice a substantial increase in sales and overall customer retention. But why? Why do these awards programs work?

There are several reasons why these programs can work, when done correctly. There are a couple of reasons for this. The first is about creating product awareness. The more people know about your products, the more inclined they are to think about them when it’s time to make a purchase.

The first is about building long-term relationships. While awards programs often start in order to generate immediate sales, the concept the relationship focuses, instead, on long-term goals. Ironically, though, you need one to lead to the other, you can’t have a long-term relationship without first experiencing short-term transactions.

The second (and more obvious reason) has to do with product and brand promotion. Awards programs can turn into a self-driving means of promoting your product, where customers actively seek you out rather than you have to go to them.


Let’s talk about each of these in more detail.


Creating Product Awareness

If you want people to buy your product or service, then it only makes sense that they are aware of who you are and what you do. Maybe they’ve heard of your brand, but have never had an incentive to learn more. Customer loyalty programs are one way to help make your brand more noticeable. Most brands have their own free app, and customers are used to downloading them as needed. Offer the app, give them a reason to try out your product or service -- but then give them an equally valid reasons to stay. Make sure the reward is worth coming back for. Give them an incentive to try new things. This will encourage them to learn more about you and your brand.


Building Consumer Trust

A customer who buys your brand and is satisfied is more likely to buy again -- that’s just plain common sense. But if those purchases keep coming, and each transaction ends with a happy customer, what you end up with is a customer who has developed an expectation that your brand -- whether it be a product or a service -- offers a consistent, pleasurable experience. Because of this, the customer will begin to be more likely to choose you in the future, regardless of whether or not there is a reward program attached to the sale. This is when true customer loyalty and relationships begin.


To market with this goal in mind, you need to focus on building consumer trust. When a customer trusts your brand, they will automatically gravitate towards you, each and every time. What’s more, that trust grows into new customers as they begin to sing your praises to friends, neighbors and family members.


Building consumer trust is more than just offering a good product or service. That might be a big part of it, but in addition to that it requires that you show your customers that they can count on you for a number of things: they can count on you to be ready to help when it’s needed, count on you to handle their information and data safely and securely -- without compromising their privacy or your integrity -- and that they can expect you to continue to offer good, relevant goods that they will want to purchase in the future.


Promoting Your Product

A second, equally important benefit of customer awards programs is in their promotional aspect. Let’s be clear about what we mean, though: we’re not talking about the short-term gain that comes with customers buying your brand due to a newly-implemented loyalty program. Sure, that temporary bounce in sales helps your numbers and your overall bottom line, but that bounce is a short-term gain that often leads nowhere. Customers who are always just looking for the best deal will use your loyalty perks when it suits them, but will still shop around for other brands as is suits them.


On the other hand, customers who have developed that relationship, who feel loyalty towards a brand, often become some of our best promotional tools. Just like a person feels almost compelled to discuss a movie they loved or a book that had an impact on them, customers like to talk about brands that they feel a strong affinity towards.


This customer-driven promotion is one of the best ways to gain product exposure, because it makes inroads into areas where your more traditional marketing tools have not been able to reach. This makes sense when you think about it: if Customer A learns about your brand from Customer B, then clearly your advertising strategies -- whether they’re online, on television or in some other media -- have not been able to reach Customer B. That’s okay, because not every advertising campaign can reach everyone.


With self-appointed “brand ambassadors” like Customer A, however, they don’t have to. Your product, your services, your brand -- all of them can be marketed in new areas when your own customers become part of the marketing solution.


PTPA Media Can Help

If you are trying to make inroads in customer loyalty, you need an experienced team of marketing professional in your corner. This is where PTPA Media comes into play. Our experienced teams can help you learn how to differentiate your product, how to promote your product, how to build exciting customer awards programs and do so much more.


Because we are parent-tested and parent-approved, we know how to market towards parents today. This involves digital-based, technology-enhanced solutions that involve video, social media and other cutting-edge solutions.


These methods are not for the amateur or the faint of heart. If you would like to talk to someone today about bringing your marketing to the next level, please don’t hesitate to contact us today.