Consumer promotions are used to either attract new customers over your competitors, increase the profitability of existing customers through additional products and services purchased, or decrease the cost to maintain that customer. The latter promotion type has become much more popular in recent years as businesses are finding that they can increase their profitability more easily by cutting costs rather than just focusing on obtaining new clients.
For instance, removing paper billing statements can save an organization up to 3% of revenues or 15% of profitability, but the majority of consumers will not switch to online billing for the good of the company or the environment unless they have an incentive to do so. When factoring in direct and indirect costs, if a paper billing statement costs $4.00 per bill each month, providing customers a $15 reward card to switch is a good investment that could save you $33 per customer per year.
We have provided prepaid reward cards for hundreds of consumer and client promotions. Typically the lowest value on a promotional card is $10. Anything less than that amount is usually not motivating enough to get a customer to take action. The most common types of promotional programs we see are consumer services that are highly competitive such as energy and telecom offerings, or B2B client programs.
Here are a few successful promotional initiatives:
|PROMOTION||REQUIRED CUSTOM ACTION||COMPANY BENEFITS|
|Paperless Billing||Agree to receive all of their monthly bills online||Reduce direct costs associated with paper, production, and mailing and indirect costs such as customer service & accounting reconciliation|
|Prepay for Services||Customer pays for several months or a years worth of service||Increased cash flow upfront, reduce late payments, increase client retention|
|On-time or Rewarding Payments||For customers slow to pay or not paying. Provide a reward to get them to settle up or pay on-time||Increase cash flow, decrease accounting costs and collection costs|
|Service Upgrades or Extensions||Opt in for additional services or contract extensions||Increases revenue and customer loyalty|
|Rewarding Purchasing Habits||Encourage increase in purchase quantity or the frequency of which the purchase (primarily for B2B channels)||Increase cash flow and revenue|
|Viral Marketing Promotions/Contests||Get your customers to spread the word through social media & other outlets through creative contets||Cheaper marketing, build customer loyalty, attract new customers|
|Customer Surveys||Fill out online questionnaire||Better client data for future marketing campaigns|