Employee Incentives And Employee Benefits News: Do prepaid incentive schemes help engagement? If you have ever wondered if a prepaid incentive scheme
Employee Incentives And Employee Benefits News: Do prepaid incentive schemes help engagement?
If you have ever wondered if a prepaid incentive scheme could help your business engage with consumers and employees, you’re in luck. It seems that research shows that by evolving your organisation’s loyalty program, you can help retain employees and motivate team members.
We spoke to Head of Prepaid at AFEX, Heather Ribbans, to learn how a prepaid incentive programme can help businesses foster not just improved customer loyalty, but more engaged and productive team members too.
An impressive 91% of UK consumers own a loyalty card, using them on average three times a week. Meanwhile, a growing number of UK businesses, particularly small-to-medium sized enterprises (SMEs), are seeking to motivate their team members by rewarding them with gift vouchers and similar prizes. In fact, recent research suggests that the nation’s small businesses offer nearly £1000 of incentives every year.
As these figures demonstrate, the incentive, loyalty or reward programme has become an integral component of UK businesses’ relationship with both end customers and employees. The benefits of such schemes are plentiful, with easily-accessible reports documenting their positive impact on employee performance, customer engagement, and brand visibility.
But, with KPMG Nunwood’s latest US Customer Experience Excellence report revealing that consumers are 15 times more likely to have a good experience with a US brand than a British one, as a result of American businesses’ greater focus on employee engagement, there is significant room for improvement here in the UK.
With this in mind, it is clearly time for British business leaders to find ways to optimise their incentive schemes to strengthen their brands’ relationships with their two most important stakeholders – their team members and their customers. At AFEX, we believe that the answer to both of these conundrums lies in the adoption of a prepaid card-based incentive programme.
Holding consumers’ attention
All businesses want to attract new customers as a means of increasing their market share. However, with a recent report suggesting that it costs between four and ten times more to acquire a new customer than it does to keep an existing one, it’s clear that businesses would be much better off looking for ways to make the most of the customer relationships that they already have.
Loyalty schemes have long been viewed by retailers and other businesses as a key way of incentivising and retaining customers, by actively rewarding them for the transactions they make and showing them that they are valued by their favourite brands. In fact, 51% of UK consumers say that incentive schemes influence where they spend their money.
However, recent research suggests that many major retailers’ customer loyalty schemes are failing to meet the needs of their customers, with growing quantities of unclaimed points languishing on clubcards and paper vouchers across the UK.
With this in mind, it is clear that businesses need to explore new ways to make their incentive programmes relevant. It is time for businesses to evolve their schemes away from the limitations of paper vouchers that can only be spent on certain products.
Opting for prepaid card incentive technology can go a long way towards helping businesses achieve this goal. With such a solution, retailers simply offer customers a Mastercard-enabled incentive card, which can be used at more than 35 million locations, both in-store and online, giving holders the freedom to spend their points where and how they like. For example, PayFEX users are able to redeem their rewards to buy unique experiences, from spa treatments, to gin tasting sessions and even culinary evenings.
Re-engaging with employees
Prepaid incentive schemes don’t just offer benefits for brands reaching out to consumers. They also have the potential to help businesses significantly strengthen their relationship with their team members, by allowing them to recognise and reward employees’ hard work.
This recognition is crucial in boosting worker engagement with their employer, as shown by a recent study by recruitment consultancy, Robert Half, which found that 50% of employees consider feeling appreciated as the key ingredient for workplace happiness. Showing appreciation in this way can have a significant positive impact on business productivity in turn, as engaged employees perform better than their demotivated colleagues.
Despite these obvious benefits, too few UK employers are meeting this requirement: some 62% of UK workers don’t feel valued at work. This is having a major negative effect on staff retention, resulting in many businesses losing invaluable talented team members.
With all of this in mind, it is no surprise that more and more businesses are turning to incentive schemes for their team members. Some 46% of SME employees say such programmes make them feel truly valued, and 33% say they make them feel motivated to work harder.
Nevertheless, as beneficial as they are, many of these schemes are running up against the same challenges as those faced by customer loyalty initiatives. Often they are administered as paper vouchers for use in high-street shops and restaurants. These can be fine for workers based in the company’s host country, but can pose a challenge for colleagues based abroad where the business’s loyalty partners do not have a presence.
A prepaid incentive scheme, such as PayFEX, on the other hand, can be linked directly to staff members’ performance, allowing businesses to automatically distribute rewards to cardholding employees no matter where they are in the world.
Moreover, if it is not possible to give out physical cards for any reason, businesses can opt for virtual cards, which can be distributed online. This eliminates the need for cardholders to wait to receive their card in the post or from a centralised location.
Smarter ways to build customer and employee relationships
Loyalty schemes are well-established as a popular means for businesses to engage with their most important stakeholders. However, as UK consumers turn towards cashless and digital payment methods for their day-to-day purchases, many existing programmes are fast becoming obsolete, undermining businesses’ efforts to build strong relationships with their customers and their employees.
With this in mind, it is vital that businesses do all they can to evolve their loyalty programmes to ensure they continue to meet their customers’ and team members’ needs. Prepaid incentive technology presents the ideal solution to this conundrum, offering a means of genuinely thanking people for their loyalty, while freeing them from the constraints of the traditional paper coupon.
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