How to Launch a Successful Cashback Reward Program?
- Posted on April 28, 2022 by Robert
- Reading time about 6 minutes
Customer satisfaction is what every business looks for to increase loyalty and retention rates for a longer time. Loyalty programs that are personalized to meet customers’ unique preferences are the ones that are more likely to be successful. One of the most common program types is the cashback loyalty rewards program. Customers feel valued and special as they can make money while spending them on the purchase of desired products from the brand. Cashback, as the name suggests enables customers to earn a small amount back after each purchase.
As there are thousands of similar programs that are running in the market already, you need to make sure that you develop a customized and unique cashback rewards program that can help you cater to the customers’ evolving expectations. In this blog, you will find everything that you need to execute a reward program and make it a successful one in long run.
Cashback Rewards Programs – Types of Businesses That Can Grab Benefits
As we know, cashback reward programs are usually characterized by a simple rule that rewards customers for every purchase. These programs are quite popular as they offer instant gratification, supporting the customer’s decision to shop. However, its focus on instant gratification & financial incentives comes at the expense of long-term appreciation.
Though cashback programs are not new in the market, it has changed over time with the increased adoption of the latest technologies. The cashback offers can now be personalized as per customers’ location & purchase behavior; the program can have a presence on both web/app for better convenience, and instant cashback rewards can be provided using card-linked technology.
Talking about the business types that can get the best advantage from cashback programs, the finance sector is the most popular one where cashback programs work like magic. Others are wholesale businesses, shopping malls, airports, and retail hubs as they deal with multiple brands from various verticals for better efficiency and higher purchase options for customers. These programs are not apt for luxury brands as they will lower the quality of customer experience.
3 Quick Steps to Help You Build a Cashback Reward Program
Some of the common ways to build a cashback rewards program are to build the in-house technology to manage it, partner with a third-party card provider, or use a loyalty program platform adding a cashback feature. Among the three ways listed, partnering is the easiest way as it enables you to add cashback offers and also comes with established technology and a userbase. However, the drawback is businesses miss out on valuable data that they could use to harness if they use their solution.
Here are the steps to help you set up a cashback rewards program-
1. Make a Cashback Account
Cashback points are the monetary value that is granted when customers make a purchase and it determines the amount of money they receive. On the other hand, reward points are a program-based currency that can be redeemed for a gift card, discount coupon, or product. To avoid confusion within the reward system, the reward points and cash back points can be calculated in different accounts.
Make sure that you build an additional cashback account for the platform users if you are planning to build a loyalty program with cashback capabilities. The main motive of your account is to ensure how much cashback your customers are eligible for, without affecting the balances of members’ reward points.
Novus Loyalty ensures that you create the cashback account with ease in just a few simple steps.
2. Set Up Cashback Campaigns
When it comes to cashback reward campaigns, one-size-fits-all loyalty solutions don’t prove to be successful. That means setting up a basic campaign where all customers earn the same amount of cashback on all offers won’t be that appealing for the customer. You should plan different cashback rates based on the following criteria-
- Offer special rate of cashback based on transaction type to boost sales
- Offer cashback bonuses in a new location for a limited period to establish a customer base
- Offer higher cashback rate for brands or product types, great for clearing out old stock
One extra tip is to ensure that you set the incentive before any new campaign of your cashback reward program goes live. For instance, if customers receive a specified amount of money back, you can set a campaign with “$10 cash back on purchases above $100” and if customers receive a percentage-based deal, you can build a new campaign with “Get 7% cashback for every dollar spent”.
Novus Loyalty comes with a clear and easy-to-use editing interface for all of its modules such as cashback rewards, making it easy for brands to edit any campaign with ease.
3. Manage Cashback Requests
If you want your cashback reward program to perform well, seamless process management is very essential. Your campaign should be designed in such a way that you execute the cashback offer by collecting desired information once a customer completes a purchase. Based on the cashback rates and the complexity of the campaign, you must ensure that information is retrieved successfully that can purchase value, product categories, location, etc.
For an eCommerce store, the cashback process is easy but if you are running it for the physical store, ensure that you use the POS system and ask customers to scan and send in their receipts to gain the cashback. Since cashback rewards are directly related to the orders. You need integration with an order management system to handle customers cashback accounts properly. Connect with our experts to opt for our loyalty management platform, Novus which can help you integrate with order management as a part of the implementation process.
Customers today expect extra earnings or special privileges when they associate with the brand and for them, there’s no better feeling than winning relevant cashback rewards just for making a purchase. Hopefully, after going through the blog above, you must have gained a better understanding of how to execute effective cashback loyalty program software. Keep the steps in mind to make sure that your program offers cashback that is valuable to customers.
It’s time to go beyond financial benefits and create cashback offerings that will help you build better customer loyalty. Connect with our expert team of Novus Loyalty to discuss more details about your cashback rewards program today.