5 important components of distributor loyalty programs

1. A CLEAR AND TRANSPARENT REWARD SYSTEM

Perhaps one of the most important prerequisites for setting up a loyalty scheme is the establishment of a clear and transparent reward system. It is essential that the rewards and the path to the rewards are as simple, clear and transparent as possible. Less is sometimes more, and it is therefore advisable to bear in mind that many people do not like to deal with complex and administrative tasks. It is therefore essential that our reward system is easy to understand and transparent.

There are many tried and tested tools available to reward the loyalty of our customers and resellers. In some industries, for example, plastic cards and points booklets to collect stamps or loyalty points are very common. The biggest challenge with these is that we all tend to forget or lose them at home, but often we simply don't want to carry a wallet full of cards from different companies. Let's try to keep it simple; let's make it clear to our target group why it is worth their while to participate in our programme and, at the same time, let's keep in mind why it is worth our while to run the programme, creating a win-win situation.

2. A WELL-FUNCTIONING BACKGROUND

A well-established background is essential for a successful operation, and one of the cornerstones of this is proper and careful administration. The performance of all participants should be fairly and proportionately accounted for. Putting more time and effort into this at the outset will save a lot of headaches.

Thoughtful communication is also a good friend. It is important to keep programme participants regularly informed of current news and the points they have accumulated so far. Where possible, campaigns should be behaviour-based, as we can trigger more based on their previous behaviour and use them effectively to boost activity. We need to constantly monitor the interactions of people in the different segments, so that we can react immediately to their every action (or lack of action). If someone is less active, it is worth communicating with them to reactivate them, and if someone is more active, we can thank them for their loyalty.

3. APPROPRIATE LOGISTICS

Before starting to set up a programme, think about how best to manage the consumption of your products and the associated point values, i.e. the process of collecting points. For one of our clients, we built the functionality around the item numbers on the product pages, as this makes it easy to track the products that are participating in the programme and sold, allowing us to accurately track the results of the programme. In all cases, we recommend a measurable product/item/code that requires little administration and that we turn into a collectible tool for our loyalty programme, so that we can simplify our own work.

4. BEHAVIOURAL INCENTIVES

In order to develop a behaviour-based incentive, we believe we need to lay down 2 key points.

When designing our Incentive Strategy, we need to keep the expected business objectives in mind, because these will help us to define the path to these objectives, i.e. we can then specify the means by which we want to motivate our target group and for what purpose. We need to ask the question: what do we want to achieve? What is the behaviour that will help us to achieve it and how do we motivate people to do it?

Incentive practice is the concrete, step-by-step implementation of an incentive strategy. In behaviour-based incentives, the steps are based on different customer interactions. Behavioural incentives for retailers are sometimes more challenging than simply running a points programme, but the basic expectation for such initiatives is that they should increase sales in a way that benefits all stakeholders. And harassing your partners with direct messages, through inappropriate channels and at inappropriate times, is more risky than ever. In many cases, behavioural communication can be a key element of success, enabling us to more effectively motivate members to do more and better work to increase our sales, maintain their interest and more easily achieve the desired level of trust.
 

5. DEDICATED CONTACT PERSON

A dedicated contact can add surprisingly high value to your loyalty programme by providing up-to-date answers to questions. In an increasingly digital world where human contact is taking a back seat, it's definitely worth providing the opportunity for personal contact. In addition to being the face of the programme in the eyes of the participants, over time a sense of trust can develop between the contact person and the members.

The key contact person will be in daily contact with the stakeholders, dealing with problems and issues on an individual basis, making each participant feel special and like a VIP, which can contribute greatly to success.