Thinking of launching a loyalty program? But you don’t know where to start? Try running a pilot program!
Loyalty programs are a long-term strategy. Getting them launched requires the strategy to be embraced and signed off by the entire organization, including finance, operations, sales and marketing. Each of these departments has their own agenda and expectations as to what the loyalty program will deliver. This ongoing internal assessment can delay the launch of a program for years, and prevent the company from enjoying the benefits that a well-structured loyalty and incentive program can deliver.
One strategy that is gaining popularity is the launch of a pilot program. A pilot program is usually confined to a specific geography or market segment and allows the company to assess the initial impact, assess the results and fine tune the program before the launch to the wider channel.
Our Top 4 Pilot Programs
1. Short-term SPIFF campaigns
Targets and fixed budgets are set and incentive payments are made based on the sales made during the campaign period. Note that there is a definite end to a SPIFF campaign so sponsors can assess the call to action and the return on investment.
2. Qualification incentives
This is where a fixed budget has been approved and rewards a fixed number of high performing participants. Indeed, we have seen a dramatic increase in this type of incentive over the past 12 months with the most popular reward being incentive group travel. The qualification threshold is set to justify the investment in the campaign and provides good evidence of the return on investment for future incentive campaigns.
3. Regional programs
This tactic has been popular in EMEA where the proposed loyalty or channel incentive program has been launched in a specific country before being rolled out to the region. This strategy provides an insight into to how a regional program will perform whilst allowing for fine-tuning.
4. Segment specific programs
Another popular strategy is to launch the incentive or loyalty programs to a specific segment to gauge their results. Segments have included tier one resellers, premium partners or distributors. When launching a segment only pilot, it is critical that you gain feedback so as use to use this information for fine-tuning of the master program.
Pilot programs also provide stakeholders with concrete results of what a full program may deliver and many cases have been the catalyst for creating advocates within the company. We have seen many success stories and award- winning programs originate from pilot programs over the past 10 years. So if you are considering launching a loyalty program, consider running a pilot first.