Rebates are great tools for keeping customers coming back for more. Loyalty drives retention and encourages repeat business, which in turn helps companies generate revenue and achieve overall growth. By offering a rebate loyalty program, you entice your customers to stay with you year over year.
Sounds simple, but your competitors are also vying for your customers’ loyalty, too. That’s why you need to know all the strategies to make sure your rebate loyalty program stands out.
What is a Rebate Loyalty Program?
Retaining trading partners is just as important as forming new relationships — if not more so! To encourage your partners to keep doing business with you, it may be beneficial to offer rebates when multiple divisions within that partner’s organization also do business for you.
Manufacturers use incentive programs to bolster loyalty from buying groups or distributors who purchase from them. The more volume a distributor or buying group purchases, the more they might earn in rebates, securing loyalty from that trading partner. Distributors use incentive programs in a similar capacity when selling to retailers.
For example, imagine you sell a lot of drywall to a home improvement retail chain with locations across the country. You can set up an incentive structure in such a way that the parent company gets a larger rebate as more of their locations sell your drywall. This incentivizes the company to promote your drywall, install product display and keep information about the product up to date to encourage sales.
How to Make Your Loyalty Program Stand Out
Having a well-managed rebate strategy from the start can make a huge difference to the success of your loyalty program. By being more strategic, you can incentivize purchasing behaviors and increase loyalty from the offset. Think about what makes your rebate loyalty program attractive to the other party compared to your competitors, so you can leverage its strategic potential.
Whether you’re a supplier or a customer, chances are you or your trading partner aren’t calculating payments quite right. And chances are, that’s led to a dispute which has ultimately damaged your trading relationship. This doesn’t drive the behaviours you intended when you launched the rebate loyalty program.
Instead, you need rebate management software that helps you compile all your rebate programs into a centralized place and runs your rebate calculations accurately, so your trading partners get paid faster and become more loyal to you.
- Clear Rebate Program Terms
The best loyalty programs are intuitive, both for the sales team (so they can promote enrolment) and for the trading partner (so they actually use it). If you make your loyalty rebate program too complex, your trading partners won’t be able to easily understand what they need to do to get their rebate from you. This could lead to misunderstandings on what they are being offered and unhappy partners whose loyalty will decline.
- Align with Your Partners Goals
Your loyalty rebate program’s success is tied to the goals of your trading partners. Ask yourself: how much do you know about your suppliers’ or buyers’ business goals? How much do they know about yours? What are your goals for your program? What resources will be necessary to support your loyalty rebate program? If you don’t know what your partners are aiming to achieve, and they don’t know what you’re aiming to achieve, you can end up working against rather than with each other. Clearly define the goals of the loyalty program and how it will benefit you both.
- Measure and Track Program Performance
Your loyalty rebate program should be measured and tracked using advanced reporting to monitor its performance and prove the program’s success not only to get continuing buy-in from key stakeholders, but to understand which of your programs are working and why. Look for rebate management software that offers real-time, unlimited access to reporting and dashboards that translate performance data in to easy-to-understand information.
- Run Multiple and Simultaneous Loyalty Programs
Not every loyalty rebate program you run will be relevant (or even possible) for all your trading partners to join. With rebate management software you can segment your trading partners into different divisions and run multiple, simultaneous programs for them. Thus, you gain revenue growth from running more programs and your partners can pick and choose what rebate programs they participate in, that align with their business goals.
The Time for Loyalty Rebate Programs is Now
Loyalty programs are already commonplace in the world of rebates, particularly as the economy springs back from the pandemic. Establishing and rewarding partnerships has immense economic value since retaining an existing trading partner offers greater ROI than winning new ones. Once you have strong trading relationships in place you want them to remain, without them swaying towards your competition. This should be incentive enough for companies to get serious about implementing a rebate loyalty program today.
Want to discover more about how rebates drive loyalty? Download our white paper: Driving Loyalty & Revenue with Rebates