Online Incentive Programs Part V

Objections to Online Reward Systems

The objections most often heard concerning Web-based Reward Systems are:

1. Points are impersonal; we’d rather give our participants something tangible.
2. The awards in points based systems are inflated and cost too much.
3. These systems take too much internal time to administer


While there is some validity to these important objections, they can be answered to the satisfaction with thorough planning during the design phase of the program.

1. Points alone are not personal. However, what points stand for can be very personal. When points are linked to specific individual achievements and performance, points are the tangible currency that an organization uses to communicate value or appreciation. Points then have a “halo effect” or “trophy value” that far supersedes the actual cost. Companies should select the reward options that points can be spent on very carefully ensuring that there is a wide selection, good value and enticing choices. If the point system is supported with technology, take the time to ensure that a high-tech solution incorporates opportunities for high-touch moments. This is essentially a communications question and can be answered by using communications techniques such as electronic or physical point check reminders, letters of appreciation, copies of recognition nominations, etc.

Consumer loyalty points programs abound. Every airline, bank card, hotel, car rental company and hundreds of other companies use points as the currency for reward. They are highly valued and personal to all who accumulate them especially when linked to the desired award.

2. The economic value assigned to points varies by company. If you’re buying an off-the-shelf tracking system, make sure that you can define the value assigned to points. It’s easy. The hard work is ensuring that performers have enough opportunity to earn points and quantifying the value of the performance associated with the points.

The cost of the awards in points is something that is easily negotiated prior to the launch of the system. Program suppliers require a reasonable profit to provide you with the service and expertise that you need to make your program successful. You can pay for this in several ways; some choose to put all program costs in the price of the award, in which case it may appear inflated. If you use this method and are charging your participants income tax on points issued, you should adjust the amount you tax by the estimated administrative costs included in the point value. Others choose to outboard these costs as administrative fees, in which case the awards will not appear inflated. Or their can be a combination of the two. The choice of how to pay for administrative costs is up to the client.

3. To make your programs successful, it will no doubt take some internal time to administer. But generally, once a program is in place, this time is far less than you might think. Compared to complex award solutions of the past, when you consider the time to develop communications, administer the award portion, do the tracking and measurement, the time spent with online web-based systems can be substantially less than doing it manually. As mentioned previously, these types of complex systems just couldn’t be done in the past as easily as they are implemented today.

If you have questions on the incentive awards industry, please feel free to ask. My passion is to help clients run successful incentive award and recognition programs. Successful programs help many folks share in the success of their hard work.

Online incentive award programs can produce some great results and have become the best value in the industry!

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