Incentive & Loyalty Automation ROI: The Devil's in the Details

Jan 25, 2018

The return on investment (ROI) on any technology investment can be difficult to ascertain.  On the cost (investment side), the software costs themselves are an obvious input; but there are typically other costs that are not considered.  And while it may seem straightforward to identify the benefits/upside, it’s possible to miss some of those factors as well.

When it comes to incentive & loyalty programs and technology solutions, the obvious costs and benefits are:

Investments (inputs)

  • Software
  • Rewards

 Returns (outputs)

  • Increased revenue

But, like every good ROI model that proves its worth, the devil’s in the details.  For example, on the investments side, there’s labor costs to consider – labor for program design and program support (which would be reduced per an automation solution).  And on the returns side, yes, an increase in revenue is to be expected, but how big of an increase?  How can you calculate that increase?

The two big determinants are: (1) the number of customers or channel partners that choose to participate in your incentive/loyalty program, and (2) the increase in business you can expect from those that participate.  One very important consideration – in those instances where customers and partners can self-manage/monitor their own program participation and progress via an incentive/loyalty automation portal, those numbers are much higher.

Sign up today to get a customized version of this ROI tool built for your data.

With the input of industry analysts, we’ve incorporated those factors into an ROI modeling tool with the following variables and expected outputs: