Digital Rewards: The Evolution of Reward Technology
A recent survey conducted by Love2shop has revealed that ever-evolving reward technology is changing expectations among consumers and opening up new loyalty and reward strategies for companies.
Over 2,000 employees and professionals participated in the complimentary survey carried out in April 2016. The study set out to compare attitudes towards rewards among corporates and the people that they employ. The results make interesting reading for marketers seeking to improve interactions with consumers and employers wanting to improve employee engagement alike.
Employees embracing digital rewards
The data uncovered an increasing willingness among employees to embrace digital rewards, but this willingness is only just starting to be reflected by corporate strategies. More than 70% of businesses present their rewards by hand while just under 25% physically post their rewards to their recipients’ home addresses. By contrast, nearly half of consumers would be happy to receive an electronic code as a gift, suggesting a significant gap between what corporates are doing and what employees would accept.
Love2shop has released a new whitepaper that examines how technology is changing expectations among consumers and opening up new loyalty and reward strategies for companies. The paper outlines a number of the benefits of utilising digital channels for issuing rewards.
Digital rewards offer enhanced data in comparison with paper and card-based strategies. This data can help marketing and human resources managers understand their colleagues better.
Once the initial set-up is complete, the ongoing cost of administering a digital reward scheme is significantly lower, with reduced administration time and postage costs when compared to posting merchandise, paper vouchers or single use gift cards. Digital rewards also don’t accrue production costs or take up physical space in an office.
Digital rewards also have a number of security benefits, including the ability to cancel and replace instantaneously. They also reduce the temptation and impact of theft.
Download the whitepaper here: The evolution of reward technology >>
Personalisation is key
Electronic vouchers are relatively easy to personalise, a factor that around three quarters of employees surveyed said was important or very important. While gift cards can also be personalised and paper vouchers can be issued in personalised wallets, brands must again consider the increased production and administration costs.
The survey also highlights consumer’s expectations for flexibility and a wide choice of places to enjoy their reward, with 84% of consumers saying that they would like to have the option to spend their gift card both on the high street and online.
From a psychological perspective, digital rewards also have considerable value. Studies have shown that it is important to receive recognition or praise within seven days if you are rewarding behaviour that you would like to see repeated. Three out of five generation Y workers expect to be able to work remotely, making it an increasing logistical challenge to hold reward ceremonies where there are enough people present to make the activity worthwhile. Receiving a reward by email or text may not have the same direct impact, but if it can be achieved with more consistency and accompanied by recognition from senior leadership, it is likely to have a better long-term influence on behaviours.
As a result, while calling-out great behaviour should always be part of a motivational strategy, issuing rewards quickly is likely to encourage teams to repeat the desired behaviour and nurture a sense of engagement. The same can be said of consumers interacting with a brand.
Social media: The people are talking
Social media is the final piece of the puzzle. Where once brands could only really show their personality through adverts and sponsorships, they can now engage with customers in a far wider way. And these interactions generate valuable data that can be used to finesse strategies.
The easy route to reward
It should also be pointed out that the proportion of consumers willing to accept an electronic code as a form of reward is likely to increase over the next few years as demographics evolve. Millennials already represent the largest proportion of the workforce and digital natives are also a rapidly growing demographic.
Ultimately, it seems that we have reached the era of electronic reward schemes, and we would recommend that firms look to manage their reward strategies to reflect the changing attitudes of consumers and how that reflects within the workforce.