2016 Distribution Trends – How Incentives Make an Impact

February 25, 2016

Recently I was searching the web for 2016 distribution trends for a client presentation and came across an article titled “16 Distribution Trends for 2016” on Since HMI Performance Incentives manages a number of programs for clients in the electrical industry (and other construction trades), I read with interest.

From an incentive / customer loyalty viewpoint, key trends included:

#1 A move by distributors to offer eCommerce
#5 Distributor information collection will & needs to improve
#6 Voice of XXX (customer) is important
#7 Live your brand
#8 Invest in a metric management culture
#15 Moneyball results for Distributors
#16 Patchwork economy and the need to take share

So, why did I pick these 7 trends? Because a well-constructed incentive or customer loyalty program can help distributors address these issues to help them grow their business in 2016.  Let’s take each point one at a time.

#1 eCommerce – distributors seem to be offering eCommerce for either defensive or offensive reasons. Defense is to retain customers; offensive is to attract new business. To gain system adoption, why not offer customers bonus points for utilizing your eCommerce system to place orders? The objective is to change customer behavior, which is where an incentive program can make a huge impact.

#5 Information collection – the registration phase is a great time to begin to capture demographic and psychographic information on your customers. HMI’s Survey Module is another tool that can be used to gather additional information throughout a program which can be appended to a registrants profile, helping companies remarket to their customers.

#6 Voice of Customer – again, here’s another great application for our eLearning and Survey Modules. Or you can offer customers bonus points for completing a more comprehensive survey.

#7 Live your brand – the communications element of an incentive program is critical as it helps keep the program alive to your customers. Through a comprehensive communications campaign HMI can help you communicate your value-added services and your company’s differentiating points to customers who are important to you. In many programs, the program participants represent 50-75% of a company’s sales. What better audience to reinforce your message.

#8 Metric management – the performance of an incentive / customer loyalty program is easily defined, and you only pay based upon performance. It’s easy to see if customers are engaged and are tracking to exceed goals. HMI’s R-Cube analytics suite provides clients the tools to measure success and reinforce the program throughout their sales hierarchy.

#15 Moneyball – Moneyball is all about metrics and understanding your business. Programs can be developed to influence an array of behaviors and R-Cube can identify trends you can capitalize upon.

#16 Patchwork economy requires market share gains – Incentive / loyalty programs are effective differentiators as they answer the WIIFM (What’s In It For Me) question.  The expect you to be price competitive, they expect good service, they expect inventory and availability.  An incentive / loyalty program can be a differentiator to help you earn the business and take market share.

If you’re facing challenges in how to grow the business, give us a call. HMI Performance Incentives can help you capitalize on these trends.

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