Digital Vs. Physical Incentive Redemption

BY Lucy Fang
Aug 30, 2019
Digital Vs. Physical Incentive Redemption

Reward distribution and redemption are key points in the structure of an incentive program. The most common methods include digital codes, physical pieces, or blended systems. Each type has its benefits, and their appropriateness will be dependant on the incentive program’s needs. 


Direct digital incentives provide an online redemption process, typically using a unique pin code. A recipient will receive a link to the online redemption center and a pin code.  They then go to the redemption center and enter their pin code. They are given the opportunity to select their reward, which will be sent to them either physically or digitally, depending on whether the reward is physical merchandise or a digital reward like a coupon, egift card, music, prepaid VISA card, etc. 

Direct online redemption processes are commonly used as part of corporate incentive programs. Digital redemption solutions provide simple and easy support to the redemption process. This solution has a low chance of human error and the least amount of steps. Real-time tracking and reporting of redemption statistics and customer support functions is easy due to the digital nature of the redemption process.

Direct digital redemption processes are ideal for use in support of corporate incentive solutions that are distributed through online processes such as e-commerce, online market research surveys, instant win drawings, and online loyalty point marketplace platforms. 


Physical Offer Pieces are reward offers that can be distributed on a certificate, physical card, or receipt distributed by mail, hand, or a POS system. Written redemption instructions and/or submission receipts/forms are typically included. Physical offer pieces are immediate and have built-in breakage.  People receive so much promotional mail that it can be easy for the reward offer to be mistaken for junk and get lost. People are also reliant on electronic engagement, which makes it inevitable that some of the physical offers distributed will get misplaced or lost. 

Physical offer pieces are usually used in incentive programs with a multi-step redemption process that can require the submission of a form sent by standard mail, or certified mail coupled with a copy of purchase receipts, along with ID and proof that the participant qualifies for the reward the card offers. 

Physical offer pieces can be cost-effective, but, if not used carefully, these incentives can damage long-standing customer relationships or create huge customer service loads. Physical offer piece based redemption must be professionally created and supported.  

Physical offer pieces should be used in support of promotional incentives in industries where they have been proven to be effective, such as travel, rebates programs, retail, auto, etc.


Some of the most successful redemption processes are part of a blended category where participants start the redemption process with a physical offer piece, but this is then transitioned into a digital process. In some blended processes, a digital process will lead to the distribution of physical offer piece. 

Blended solutions can provide an essential fit between a project’s budget, requirements, and redemption method. The nature of the incentive program, such as it’s budget, demographics, or client relationships, will be what determines the appropriate redemption process to be used.

Blended solutions are best when a program’s operational requirements dictate a delivery mechanism that is at odds with the redemption process required by the project. 


No matter what your reward redemption needs, All Digital Rewards has a solution for you. To speak to one of our redemption experts call 866-415-7703 or click the “Schedule a Demo” button at the bottom of the page.