7 Reasons Your Business Needs a Rewards Program

Retail stores, such as Borders, learned the hard way. By locations dropping in major metropolitan areas everywhere and overpowering mom-and-pop bookstores, Borders (and Barnes & Noble) became the place to be. But then shoppers started paying attention to how much the price of books were in online stores, such as Amazon and Ebay, versus physical stores. Careful consumers started wondering, "Why should I pay double the price for this item? What do I get out of it?" And a major chain of bookstores closed. So why is Barnes & Noble still open if their books are just as expensive? Rewards programs (memberships) may be the answer, and it's not just in the case of bookstores.
Explaining the value of rewards programs charges

Paid memberships can be a hit or miss. With electronic stores, such as Best Buy's Reward Zone program, there is no charge for the rewards program. B&N charges a $25+ fee to be a member though. And although "free" is always more appealing than payments, if the retail store can easily explain how customers will get their money back, the membership price may seem reasonable.

Competing with online rates

More tech savvy stores like Huzzah Media choose to promote their online stores as prominently as their physical locations. Other companies can't afford both. But even if online purchases don't bring in the same funds as in-store purchases, rewards programs are an effective way to compare savings with other companies' sites.

Keeping track of purchases

Anyone who has been in a grocery store and bought something last minute at the checkout lane knows people are impulsive. They may go onto a site to buy one thing and end up purchasing a handful of other items. Rewards programs help keep track of what impulse purchases are made and who is most likely to make them.

Better chance of online and retail rates

Even if a consumer wasn't originally thinking of purchasing an item, knowing that they'll get a money-back certificate or coupon in the mail from the rewards programs may give them the push to shop in stores or online again.

Consumer savings options

Rewards programs make consumers pay more attention to available items that they normally wouldn't have bothered researching from the rewards programs company.

Money back

Whether it's $1 or a penny for good luck, people like getting their money back. While realists believe that they're only getting their own money back, if the rewards programs are with stores they already enjoy shopping in, they'll eventually make a valid savings. Companies must be sure to point this out when promoting rewards programs.

Getting to know the company

For consumers who just want a product, it doesn't matter where they get it as long as it works. Rewards programs create a relationship with the consumer that walk-in customers do not.

Companies want to make a profit, but they also should want to operate reputable companies that are a benefit to the consumer and themselves. Rewards programs are a one-stop shop to creating lasting relationships, getting free and easy analytics on customer habits and hopefully making more of a profit.