Why do rewards resonate so well with customers?
Loyalty schemes, prizes and rewards have a huge impact on brand loyalty and customer engagement because appreciation and rewards have a positive psychological effect.
78% of employees say recognition motivates them in their job and a combined 68% of respondents in REBA’s The Rewards Report 2016 said recognition with a reward made them feel valued or motivated at work.
The same positive impact of rewards and appreciation can be applied to consumers paying their accounts as well. It is all about science.
The Science behind Rewards
What psychological impact do rewards have on a person?
Being rewarded through a loyalty scheme or rewards program is an expression of gratitude from the brand or company to the customer for continuing paying their account over another competitor. It also helps to incentivise a customer to continue to pay their accounts.
Gratitude has shown to lessen stress, increase your metabolism, and improve your sleeping habits – all of which can have a positive effect on people’s health and wellbeing.
But, let us be honest – consumers may not necessarily associate their improved sleeping pattern with your brand, the experiences they do associate with will be positive as they feel they are getting something in return for their payment.
The neurotransmitter, dopamine, affects the pleasure and reward centres of the brain. This is affecting the positive experiences a customer has with a brand. Dopamine is often linked with addiction, meaning that once they satisfy those pleasure cravings, they want more.
Sharon Begley comments on dopamine in The New York Times, saying:
“Activity in the dopamine circuit is not so much about pleasure as about expecting pleasure, and when we don’t get it, we feel driven to seek it out, desperately and compulsively.”
That’s not to suggest getting rewards by being a loyal paying customer is an addiction but, in layman’s terms, if customers get pleasure from what extras brands can offer them, this can improve companies’ customer retention and brand loyalty.
eColls™ is a digital first in the credit management industry where customers can create arrangements and make payments without any added costs or fees. It allows the customer to update his/her personal information, log their queries, make arrangements and choose from an array of payment options and then get rewarded.