Cutting Costs On Sales Incentives Programs

in Press Releases

By: Jason King

time to cut costs on sales incentives programs

In a previous post I had alluded to a future article that would include some ideas on how to save money while still executing highly  effective sales incentives programs.    Today is that day and we’re going to look at some changes you can make to have a meaningful impact on the budget of your next campaign.   These are changes that scale well, have low cost to implement and will  reduce your expense on all future campaigns.  

paper creates inefficiencies in sales incentives programs
Go Paperless and Automate

Specifically, find a software platform such as the 360 platform to build and manage your programs.   Quite simply, when you digitize your campaign you are effectively removing time from your process – time to fill out forms, time to mail, time to collect and open mail, time to input data, time to handle checks.  

You want to give your customers/RSAs a web portal to log into to enter their claims – the data is entered once by those most familiar with the details of the transaction in the first place – the retail sales associate in the case of spiffs or the consumer in the case of rebate programs.  Each claim then becomes a digital file that moves through your system without anyone touching it and with the original, accurate data remaining intact.

When you remove some of these people steps and shorten the time to payout on your claims, you are also reducing the chance of breakage between your brand and claimants, thereby reducing friction against future opportunity with these important folks. 

stop wasting paper in sales incentives programsWe are going to get into some serious savings around this when we talk about payments, but for now, let’s have a quick look at just the costs of having print collateral for a consumer rebate campaign.  

What is the intended reach of your campaign, in terms of numbers of people who will need to physically fill out and mail a piece of paper to you?   What is your cost to print this paper?   Try some quick math:

(Intended reach of campaign ÷ 1000) x Price per thousand for printing = ?

Now how many physical locations does this print collateral need to be available in?   Let’s assume it will cost you $45 to package and ship the materials to each location: 

locations x $45 = ?

Of course, this elementary math makes no allowance for the amount of waste invariably created by this way of doing things and so it becomes important to look at the optics of being perceived as a wasteful company, or one who is simply not building the kind of front line engagement that successful companies worldwide are winning market share with.

sales incentives programs automation bonusesAutomation Bonuses!

By automating and digitizing your sales incentives programs, your dramatically reduce the timeline to visibility into your programs and their effectiveness – you have your data in real-time, months quicker than the old way and can adjust (remove) incentives when they are not required, which becomes another opportunity for saving.

Additionally, instead of hoping that one day someone in consumer marketing will enter the data from all your rebate forms and start marketing to these folks, you end up with a very clean database to work from with the data keyed in by the prospects themselves.   Make sure your process includes an opportunity for these folks to opt-in to future messaging from your brand!

Make Backup Documentation Mandatory

keep calm and do your paperworkIf your company is going to be good enough to give someone money in the form of a sales incentive or loyalty program payout, the least that they can do to earn that money is have their paperwork in order.   On the surface, it may seem like you are creating an extra administrative burden for yourself by gathering the store invoice or delivery slip to support the claim, but if you are using the proper software platform this will not be the case.

Most of our clients see an 8-9% reduction in total claim volume within the first 90 days of launching with us and the reason for this is simple – 100% of the claims being processed through our system get audited and therefore 100% of the claims require a copy of the documents related to the claim.   This 8-9% number can be directly attributed to fraudulent claims being entered into the system.   When fraudsters see that their claim is on hold pending the addition of supporting documents (which they naturally do not have) the claim drops out of the system.    A client executing against a quarterly marketing spend of, say $20M sees huge value in adding this extra step.

electronic payment is inexpensive fast and scales wellPay Out Electronically

Here is where the cost difference actually gets insane.  If you or your fulfillment provider are  generating and mailing out paper checks, it is time to really have a serious look at electronic payout methods.   

This calculator, provided by a large Canadian bank, shows high and low average figures associated with what the real cost is for an organization to generate a check.   There are many studies on this, and the generally accepted figure is around $15 per check.   Multiplying this figure by the number of incentive payouts you are fulfilling in a month will quickly show you the opportunity for savings by moving to electronic payout.  

As of this writing, prepaid cards are the least expensive, easiest and most scaleable solution and they have the bonus of being able to be branded with your company’s logo and messaging.

Obviously this is the 30,000ft view and all great sales incentives programs require great strategy behind them.  If you’d like to really get into the weeds on this information, let’s book a call!  

contact 360 incentives  

Have a great weekend.

Jason King 360 IncentivesJason is the Content and Community guy at 360Incentives.com Connect with Jason on Twitter @JayKing71LinkedIn or Google+  360 is changing the world of incentives.  To find out how, book a call with us now!

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