How to Implement a Rebate Marketing Program to Acquire New Customers and Boost Your Sales
Marketers all over the World in many different industries implement rebate marketing programs to boost sales and attract new customers. This article will explain what a rebate marketing program is, how to implement one, some important considerations, and the pros and cons of a rebate marketing program.
What is a Rebate Marketing Program?
How to implement a Rebate Marketing Program
Step 1: Offer a rebate to all who purchase a product or service.
Typically, a business offers the rebate marketing program as a limited time promotion. This has to be communicated through advertising to a business’s target market. The success of a rebate program is highly dependent upon potential customers’ awareness of the rebate offer. You can send out rebate offers as a direct mail campaign, or simply have the rebate forms displayed at the point of purchase.
Step 2: Create rebate fulfillment rules.
Typically, a customer will be asked to mail or register on-line and provide details about the purchase, like a proof of purchase and the UPC (Universal Product Code).
Step 3: Collect the Data and Rebate Fulfillment.
A business needs to have a plan to fulfill the rebate. This can be a time consuming and labour intensive process of collecting the marketing data about the purchaser, checking the validity of the rebate submission, and mailing out the rebate check or promotional item promised in the rebate. Typically, this part of the program is outsourced to a Rebate Clearinghouse, or a Rebate Fulfillment Company, or sometimes called a Rebate Management Company. These companies usually provide a mailing address to send in the required documents, or an on-line solution to collect and verify the rebate. Many also provide a service to print and direct mail the cheques out to the rebate applicants.
Step 4: Analyze the results.
Your Rebate Management company should be able to provide you with lots of data about the amount of rebates fulfilled, the names, addresses and phone numbers of the rebate applicants, date of purchases, and the total cost of the program. You can then correlate this to your sales figures for the period and determine the effect of the rebate promotion.
Consider 3 factors in your overall design:
- Increasing the size of the rebate will increase sales AND redemption rates
- Increasing the effort required to obtain a rebate will decrease sales AND redemption rates
- Giving consumers more time to redeem the rebate increases redemption rates.
Pros and Cons of Rebates
· Simple to communicate and understand, depending on the offer structure
· Although discount based, it avoids the “discount on every purchase” mentality
· Rebates in the form of gift certificates can often drive customers back to the store
· Does not require much administration
· Cheaper to administer than a reward points based scheme
· Can allow tiered offers for highest value customers ice: buy 1 get $10, buy 10 get $100