Reward Redemption Process is Crucial to Good Engagement

BY Lucy Fang
Feb 16, 2017
Case Study - Redemption Process is Crucial to Good Engagement

Executive Summary

At its core, the purpose of an incentive is to impact the behavior of employees, customers or respondents.  Any incentive that does not impact behavior or decision making is simply a waste of time and money.  Simply stated maybe, but that doesn’t make the statement any less Accurate.

As factual as that initial statement is, it does not present a complete explanation of the true role of an incentive.  It is true saying that an incentive must impact initial decision making of an employee; customer or respondent the company using the incentive must also take a long-term view of their ongoing relationship with the recipient.

A well-structured incentive plan cannot only positively impact initial behavior and decision making but also solidify a long-term (and profitable) relationship with the target audience…or forever end that relationship and likely the disgruntled respondent’s immediate circle of influence.  An incentive plan must take into consideration the impact the reward redemption process may have on the long-term potential of the client relationship.  Unfortunately, too many incentive marketing agencies are long on innovative redemption processes but short on the vision for the long-term impact they may have on client relationships to their audience.

Many key stakeholders focus too much on the cost per incentive when evaluating a potential solution.  The danger of that mentality is not considering the ability of a professional incentive marketing agency to alter their client incentive costs through the manipulation of the redemption process to create natural “breakage.”  The wrong incentive marketing agency can often offer incentive rewards at prices considerably lower than the actual cost of the item by creating a cumbersome, multi-step redemption process that creates breakage…and often frustration and anger on the part of the recipient.

High breakage (promotional) incentives certainly have a viable role in the marketplace.  Promotional incentives are a highly effective tool for businesses that have a need for high perceived value incentives that require only a onetime relationship with recipients.   Industries where promotional rewards are common (Auto, Travel, Retail) are it is found to be widely accepted by the consumer.  However, these promotional incentives are problematic when the process of redemption is set up incorrectly or in the wrong environment.

Table of Contents:

Incentive Types


Promotional Incentive

Corporate Incentive

Incentive Distribution Methods


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