News

Rewards beat discount when it comes to retail promotions

September 21, 2018

Retailers offering shoppers reward-based promotions to drive engagement and purchase activity will likely experience bigger marketing success and profitability compared to offering discount-based promotions.

Reward-based promotions are those that offer shopper incentives to drive purchase and the discount approach offers a reduced purchase price.

The insight, from Aberdeen Group research commissioned by Hawk Incentives, can help retailers striving to boost and deepen customer loyalty, according to a press release. The research surveyed more than 200 U.S. businesses on use of reward and discount promotions.

"Businesses have plenty of choices when determining marketing strategy, but reward-based programs stand out as incredibly impactful options to achieve business goals and drive effectiveness," Theresa McEndree, vice president of marketing, Blackhawk Network, said in the release. "These promotions enable businesses to encourage consumers to buy products while creating engagement that makes them more likely to make repeat purchases in the future. Consumer loyalty can be fleeting, but reward-based promotions offer businesses the opportunity to keep shoppers coming back while also encouraging revenue growth and building brand reputation."