new loyalty program - pls. comment

[market44]

hello,

i am looking for web merchants willing to try out a new type of loyalty program extending the concept of 'cash back' (direct discount offered to the customer).

in brief, the idea is to allow a web merchant to credit the account of its customers with small money in order for the customers to buy products on third party merchant websites.

of course the rewarded customer could buy products on the merchant website having issued the discounts but in some cases this is not an appropriate strategy, for instance if you sell office furnitures it is not
appropriate to reward the secretary ordering the products with a discount for a new chair, because it would be obviously more rewarding for her to get cash she can spend at a beauty shop.

the loyalty program i am introducing is actually linking the interests of such different merchant websites. on one hand i am looking for web merchants willing to offer discounts to their customers, and on the other hand i am looking for web merchants willing to offer their products as goods to be purchased by the rewarded clients.

in terms of costs, the merchant willing to reward its customers buys in advance the products sold by the other merchant. however, that's only the general idea. in practice, the system's design allows the second merchant to issue 'exclusive money', i.e. money that can be exclusively spent at its merchant website. thus, for the rewarding merchant it is more about acquiring this 'exclusive money' and to reward its customers with bits of this 'exclusive money'. in other words, there is no products to buy in advance, it is about setting a deal between the merchants (how much do you pay to get the 'exclusive money' of the other merchant) and to let all
the participants do their job: the rewarding merchant distributes its rewards under the form of 'exclusive money', the second merchants makes its products available to this 'exclusive money', and the customers choose
whatever product they like to cash back their rewards.

in terms of technology, there is a specialized platform dealing with everything and it is just a matter of allowing the servers of both merchants to communicate with this platform via PHP scripting.

does that sounds interesting?
do you have comments / questions?
do you want to give it a try?

pls. let me know.

 

[DesignsOnline]

I suspect you would struggle to find people willing to participate, If it were me, I would be worrying about putting up this "reward Cash" and having it spent at all the other stores.

A discount code that could be used at any of the stores might work, but there would either need to be an automatic comunication between the databases of the participants, or a manual notification made once the discount has been used.

Unless all the stores are happy for the discount to be used at all the other stores too, which as it is a discount and not actual cash wouldnt matter.

It is an interesting concept but would need a lot of careful thought to make it a practical application.

Joe

 

[JonathonV]

I have to agree with the previous poster-any loyalty schemes that I arrange I would want to do so in order to stimulate further purchases from me-not sending the client elsewhere. Maybe you'd find people interested, but I look out for my interests when it comes to my business, not other people's

 

[sysops]

does that sounds interesting?
do you have comments / questions?
do you want to give it a try?

Sorry to be negative, but as a retailer we would never go for something like this. Give people money to spend elsewhere???

 

[market44]

I suspect you would struggle to find people willing to participate, If it were me, I would be worrying about putting up this "reward Cash" and having it spent at all the other stores.

i wouldn't worry to send clients to another shop in order for them to spend their 'reward cash', especially if the products sold by the third party shop are more appropriate than yours as far as rewards are concerned. for instance, i would appreciate to receive 'reward cash' to acquire a flight when buying hardware. actually, there is no constraints: the merchant can propose more than one third party shop, including its own shop. basically, the key advantages for the merchant is to offer a (very) large variety of rewards, to avoid all the processing of the rewards (stock, handling, administration, expedition, possible complains, and so on). in conclusion, the reward is 'dematerialized' and converted in a more flexible medium: money.

 

[market44]

I would want to do so in order to stimulate further purchases from me-not sending the client elsewhere.

in this case you can issue 'reward cash' to be spent on your website and your benefit is to get rid of the administrative part of the loyalty program as it is self standing.

 

[market44]

Sorry to be negative, but as a retailer we would never go for something like this. Give people money to spend elsewhere???

but would you do it if it helps your business?

what do you sell? only music? then it is valuable to reward with mp3 players.

on another note, it is also well known that discounting your own products removes value from your products (if i can acquire the same product at a discounted price, what is the real value of this product?)

and did you consider that your products might be acquired with 'reward cash' because another merchant considered it as valuable for its clients base?

 

[sysops]

but would you do it if it helps your business?

But it wouldn't. Trust me, I know what I'm talking about.

 

[market44]

But it wouldn't. Trust me, I know what I'm talking about.

do you mind to let us know what is your business about?

this way we could discuss possible benefits and/or inconveniences having a real case at our disposal.

 

[JonathonV]

in this case you can issue 'reward cash' to be spent on your website and your benefit is to get rid of the administrative part of the loyalty program as it is self standing.

I have never found the reward part of my client program to be a problem though-it's not something that I would be looking for an alternative to. It works, and it's simple.