The main objective of points to cash mechanism is to encourage client behavior that benefits the company’s growth. It is an effective method to thank your devoted consumers, increase brand loyalty, and, most importantly, user engagement.
According to the Pareto Principle, often known as the Law of the Vital Few, just 20% of your customers account for 80% of your sales, and 20% are frequently devoted, recurring clients.
Making a rewards program enables you to concentrate on the critical 20%!
You have stumbled upon the right place if you wonder;
- What a reward points system is,
- What incentives a points-to-cash mechanism offers to repeat customers, and
- How user engagement is increased through points to cash mechanism
What is a Points to Cash Mechanism
Rewarding points to customers through the points-to-cash mechanism is among the common types of client loyalty programs. A points-to-cash reward points system is a strategy to incentivize customers to increase spending via earning. The points can be in the form of credits or in-store points.
When purchasing, points are added to customers’ accounts. Customers can use their points to get rewards or exchange them for benefits and additional freebies when they shop further. In some tiered loyalty programs, customers can accrue points and upgrade from “regular” to “VIP” status.
Incentives of Points into Cash Mechanism
1- It Makes Your Customers’ Day
This is a fantastic use for your points, whether you use them monthly for holiday gifts or once a year for Christmas shopping. Who doesn’t like having one of the many gift card possibilities that most credit cards offer?
If the “gift” column in your monthly budget was blank or insufficient, you simply fixed a budgeting issue. If not, you can use the money differently, such as for investing or saving.
2- Maximizes Financial Resources
Whether you save your points or use them immediately, points to cash incentive is a smart way to boost your customers’ budget. There are various theories and calculations around this area, and specifics largely rely on the card. Would you like to increase the amount you have set up for emergencies?
You have found some further savings if the answer to the questions “Are you using your card for essentials, such as groceries?” and “Have you paid off your balance?” is yes.
Options for redeeming points into cash also work effectively to cover costs. Consider the scenario in which your post-holiday costs are higher than normal. Converting points into money can be a helpful utility if you still need to redeem your points.
3- Can Make Lives Smarter and Healthier
That fitness checker, smart thermostat, security camera, or cordless vacuum you were planning to buy? Why not improve your lifestyle (or your family’s lifestyle) by leveraging your reward points?
You may argue that you can find that thing cheaper elsewhere, and you may be right. However, can you afford to purchase it right now? If not, then this might be the ideal usage of those rewards.
4- It Gives an Option for Quick Escape.
What about a ski trip with the family, a visit to a nearby restaurant for quick coffee or dinner, or a spa weekend? You can enable customers to cover the costs to travel or buying a house by giving them points for cash opportunities. It can be packed together with your clothing and toiletries with little beforehand planning (check availability) and wise expenditure.
5- Make Customers’ Dreams Come True
Is it a family trip to Disney World, a Greek Isle cruise, or an Amalfi Coast foodie tour? What about a hot air balloon ride, whitewater rafting, or a private plane lesson? You can make that wish list come true with research, persistence, and intentional expenditure.
6- Enables Customers to Earn More Points
Multiplication of reward points is the only thing that can beat reward points! Watch out for promotions from the company that issues your credit card that can raise the points you receive for specific transactions. It’s a clever technique to increase the potential of point earning to have more points to use later.
Five ways to Increase User Engagement Using Points to Cash Mechanism
1- Points to Cash for Account Creation
Creating an account is the initial client action on your website that can earn them points. Many people need to be more active and willing to utilize their personal and contact information to create an account when browsing a website. Therefore, you might offer them reward points as compelling inducements to sign up on your website.
As per Marketing Dive research: Consumers are 40% more likely to view products recommended based on information they have shared with the brand.
This way, it’s possible to increase the number of repeat customers and thus increase your profits.
2- Points to Cash for Purchases
Implementing the idea of “spend more to earn more” is one of the popular ways to reward clients in the points-to-cash mechanism for eCommerce. You may encourage customers to buy more of your products and spend more money by allowing them to earn points each time they make a transaction.
For instance, customers can receive one point for every $10 spent. Resultantly, 10 reward points will be applied to their account following a $100 item purchase. A $10 discount on their subsequent order is possible with these 10 points.
Setting the date of expiry for converting points to cash should be considered. In this way, customers are reminded to redeem them within a specific time.
3- Points to Cash for Product Reviews
Allowing consumers to earn points by reviewing purchased things is another concept to look after when designing points for the cash system.
Do you know that, according to the Spiegel Research Center, a product with five reviews is 270% more likely to be bought than one without any?
However, consumers frequently need more passion for revisiting their purchases and providing feedback. Therefore, introducing points to the cash mechanism can motivate customers to return to your site and offer product reviews.
You can thus accomplish two goals at once by utilizing user-generated content to increase sales and retain a solid connection with your clients.
4- Points to Cash for Referral Activities
According to a Nielsen survey, over 90% of customers trust recommendations from friends and family more than ads.
Paying them for referring their relatives and friends to your online store can easily convert your customers into dependable brand ambassadors.
These new clients can be drawn to your loyalty program and turn out to be referrals. Thus, doing things this way will ultimately be beneficial to your company. Additionally, you can give your clients more points when they successfully suggest a consumer who purchases through your referral link.
5- Points to Cash for Social Sharing and Comments
An effective strategy to increase organic internet traffic is to share your information and merchandise on social media. So why not allow your consumers to convert points into cash through social sharing?
Also, this concept motivates them to tell their social network about their preferred products. Now that you have more opportunities to turn social media attention into sales and your consumers have more points to use toward deals and offers, everyone wins!
Furthermore, offering incentives to visitors who leave comments on your blog may help you learn more about their interests and develop creative content to meet their needs effectively.
Offer Points for Desired Actions
Give users points when they take actions you want to encourage. This could include:
- Making a purchase
- Referring friends
- Writing reviews
- Engaging with content
- Completing their user profile
Tie point gains directly to key behaviors on your platform. Make them tantalizing enough that users go out of their way to earn more.
Let Users Redeem for Rewards
Allow points to be redeemed in a virtual shop for prizes users truly want. Popular options include:
- Discounts on future purchases
- Free products
- Donations to charities
- sweepstakes entries
- badges and status symbols
Customize daily rewards to your audience. The incentive of redeeming hard-earned points keeps users engaged.
Leaderboards Satisfy Competitive Urges. Public leaderboards drive engagement by letting users compete for top point totals. Transparency fuels competition to climb ranks and gain bragging rights. Make sure to segment boards by relevant criteria, so users compete fairly against similar users.
Run Special Point Promotions
Drive excitement and spike engagement with special point-boosting promotions like:
- Tripling points gained for a weekend
- Bonus points for referring new users
- Points jackpots through gamified contests
Limited-time promotions give users an incentive to take action now before missing out.
How myCred is a Game Changer in Providing Points to Cash Mechanism
myCred is a WordPress plugin that is designed for the points management system. There are various add-ons that myCred offers to increase customer loyalty through the points management system. Among those add-ons, cashCred is at the top.
cashCred is myCred’s built-in add-on, which enables users to convert myCred points into real money anywhere, anytime. You can offer your customers an opportunity to earn myCred points through myCred’s rewards system. Instead of offering them cash, you can offer points to them that are encashable at any time.
cashCred work is a perfect point-to-cash system that helps engage users in activities that need user interaction, like writing a review, watching videos, or filling out survey forms.
One of the best methods to enhance customer loyalty is to develop an efficient points-to-cash mechanism. An efficient point-reward system improves your rapport with present clients and makes your company’s identity stand out among rivals.
Customers can receive rewards for their actions on your e-commerce website, including referrals, product reviews, purchases, and more. The mechanism will drastically raise your conversion rate and increase customer retention and income.