Empowering channel partners to drive sales growth in 2020 Part 2: The right way to reward
In the previous blog we talked about how to motivate the channel partners to accelerate sales growth. Besides maintaining a close relationship and providing them with effective sales tools, the kind of reward that you offer plays an extremely crucial role in motivating them to push your product. Let’s take a look at how both, companies and channel partners, can get benefited by the right reward system, taking the partnership to the next level in 2020.
The importance of rewarding
Your channel partner sells for you. The higher their motivation, the stronger they will push the product to the end consumer. By rewarding them well you can ensure higher motivation and loyalty.”
A GRP-heavy advertising campaign can bring your brand to the top of mind of end consumers. But when it comes to the FMCG industry, that is not enough to covert to sales. Distribution and retailers’ recommendation play a very important role in influencing the consumer’s purchase intention. With multiple brands cluttering the market, there is intense competition to get the distributor’s/retailer’s mind share, without which it is difficult to increase sales. This is where a reward program is needed. Channel partners need a reason to push your product. Of course, product and brand power are crucial but so is the kind of reward that they will get by selling your product.
The importance of RIGHT rewarding
“The higher the perceived value of the reward, the greater will be their motivation.”
The practice of incentivizing channel partners to sell more has been around for a long time. The key to any reward program has always been to get the channel partner “engaged” with your company. However, the level of engagement depends greatly on how exciting the reward is to them. Many years ago, cash-based rewards were the most common. Then in an effort to make their rewards unique, companies started giving out aspirational items such as washing machines, refrigerators and air conditioners. As these items became common in every household, the gifts changed to holiday packages and gold coins. These gifting options are common even now. But the times are changing. These gifts are no longer unique and though they may cost a fortune to the company, they are of little value to the channel partners.
Year 2020 is all set to revolutionize the way companies reward their channel partners. There is an increasing need to motivate the channel partners by promising them a reward that they will truly value. By giving the right rewards, not only will you get the channel partners' attention and mind share, but it will go a long way in earning their loyalty.
Why Gift Cards are the right way to reward?
Gift cards have many advantages over traditional gifts
- Higher value, higher engagement
- Easily customizable
- Guilt free shopping
- Can be used by family members
- No logistical challenges
- Easy to manage and track
Cash rewards may have been the most popular choice until now, but the truth is, they are forgettable. It can make the recipient happy for a moment, but it is definitely not something that the partners will remember you by. With gifting household commodities, you run the risk of giving them something they already have. But with gift cards, channel partners have the freedom to buy something tangible that they have been wanting to purchase for a long time, sans the guilt of spending any money. This tangible item becomes something that will remind them of your company and of their contribution to the achievement of the company’s goals. Such memorable gifts will make them feel more appreciated, keeping them engaged with the company. Another big benefit is that the channel partners could choose to use the gift cards to buy something for their loved ones. Not only will this give a lot of satisfaction to the partners, but it will also ensure that their family members support their goals, motivating them further.
But that’s not all! The companies can largely benefit by incorporating gift cards in the reward program, all thanks to new technology. Read our next blog to find out about the ease of rewarding with the use of technology..