Reinventing Rebates
How They Can Drive ROI and Market Research
Bringing in more revenue is on the top of the list of things to do for most storeowners in 2011. Selling more and cutting costs are the tried and true methods for doing this, but often, both are easier said than done. That is why some smart baby and children's product retailers are considering alternatives.
Many are familiar with rebates. They are great tools for advertising and promoting low prices. Unfortunately, over the years, they have become a necessary evil at worst and a nuisance at best. But some retailers are starting to see rebates in a new light. Thanks to new technology, they actually can deliver significant return on investment in a number of ways:
Valuable Market Research
Pre-paid card technology can be used to provide retailers with considerable market research on their customers. Imagine this: A manufacturer offers a $50 rebate on a stroller. The rebate processor makes it really easy for people to get the rebate by putting the whole process online. They mail out a pre-paid card to your customer and they use that card to spend $10 on diapers, $20 on a haircut, and $20 on 2T clothes. Or they spend $35 at a locally-owned pizza shop and $25 at the movies. Suddenly you know a lot more about your customers than you ever did before and can leverage these insights to tailor promotions for maximum effectiveness. It's when you begin to collect this type of data that you gain a better understanding of your customer's demographics and their spending habits, allowing you to create more detailed and more targeted marketing and advertising than you could have imagined before.
Opportunities for Follow-on Sales
Many times, rebates are offered for big-ticket items. Those items often require additional, less expensive items. For instance, if you sell a crib, your customer also needs sheets, bumpers, mobiles, and a lot of other items. If you make it easier for consumers to redeem rebates online, you can collect the email addresses, mailing addresses, and phone numbers of those who shop at your stores. You can then use that opportunity to send follow-up special offers that include deals on other things they need for the crib and other merchandise you sell. Some retailers who have taken this approach have seen anywhere from 30-40 percent of the dollars they paid out as rebates being spent back to their stores. Retailers can also see further traffic to their stores when dollars from manufacturer funded rebates are being used by consumers to make additional purchases at your locations.
Increased Loyalty
Creating a fast and easy rebate process can put you in a favorable light with your customers. But it does not need to stop there. As mentioned before, you can tailor marketing to them and can offer follow-up specials. You can also add them to an e-newsletter to market new products or create special events and invite your best customers that you know have extra rebate money to spend. Eventually, you will also be able to create a loyalty program that gives your customers points and incentives as well as their rebate money.
Rebates can become a very powerful marketing and advertising tool for baby shop owners who are willing to reconsider them and incorporate new technology. It might be just the resolution you need to make 2011 the most successful year yet.