Guest Column - July/August 2011

Avoiding Commoditization & the Death of the 'Wow' Factor

By David Little

Let's address a serious problem that is occurring in our industry, even society as a whole: the loss of the "Wow" factor. The "Wow" factor is what makes an incentive, gift or promotion unique and memorable, and a related program consistently successful. Unfortunately, in today's society gifts are measured in currency equivalent, which is both easily determined and quickly minimized. We can call this the over-commoditization or commercializing of reward items available to us.

Most of us have memories of earning gifts and prizes that stay with us throughout our lives. Perhaps we knew the value, but the "Wow" factor was present enough to offer lingering or nostalgic memories.

I remember one from a young childhood episode. In 1967, WABC-NY radio ran periodic contests. One involved sending a postcard to the studio, stating why you liked a particular product. Oddly enough, my card was picked—and through the mail I received a package of that week's top 40 hits—all in 45 RPM records (those were bigger than CDs, for our younger audience). Beatles, Lulu, Procol Harum, Box Tops, Strawberry Alarm Clock, Jefferson Airplane, etc.—that was some "Wow!" To this day, I recall the package sitting on the milk box (another '60s concept) surrounded by snow with my name on it. I still have all of those 45s, almost 45 years later!

Can you remember the first gift that came through an incentive or promotion program years ago, that "wowed" you? How about from a more recent reward program? Chances are, in our jaded world, most gifts were received with a modicum of excitement.

One can attribute this lack of "Wow" factor to the world as we know it, thanks to mass media, the Internet, big box stores and the general availability of items and their pricing. Look at the more popular items available in our industry.

Travel-for-points is an example. These travel points are increasingly more difficult to use and redeem (unless you crave 6 a.m. flights), yet people continue to display loyalty to the issuer out of fear of losing saved points.

Merchandise brands with items such as electronics, watches, appliances, etc., are so ubiquitous that one only has to go on the Internet to see the same items available with multiple sources and prices. A typical story is the guy who received a gift and quickly scanned the UPC code on this phone only to be disappointed by the value.

Then there are gift cards; they are convenient, but clearly denominated in a monetary value or partially blinded under some point scheme. This forces us to go to some store (frequently not one of choice) or banish to purchasing oblivion by throwing them in a desk drawer. "Is that all I'm worth? A $10 gift card?" asks the motivated employee? We all also know how the breakage model works, what value goes in, doesn't necessarily come out. Not much "Wow" there.

So, how does one still get back the "Wow"? With some work and creativity! Here are some trade tricks:

  • Bundling: combining seemingly unrelated items that support a theme. Thus, for an incentive beach trip, one might include a suitcase with a pair of sunglasses or a food package related to the destination.
  • Blinding: putting together different items (sometimes from a related manufacturer), that support one another, which makes sense as one package. For example, Keurig machines are presently a very popular commodity, but by adding K-Cups, cookies and cakes to create a holiday package, we add value. This blinds the true cost and value. Blinding can also involve multiple manufacturers with competitive lines, whose products are usually not combined. For example, a "Chocolates of the World" set includes Cadbury, Ghirardelli and Lindt components.
  • Repetitive Step Incentive: Pete Mitchell, director of B-to-B Sales for Samsonite LLC, has done this by offering different parts of a three-part luggage set at different intervals of an incentive program. Each recipient needs to do more to receive the next piece of luggage.
  • Creative Packaging: dressing up a standard item with special or unique packaging, or customizing with a ribbon or personalization to give a more gift-oriented appearance.
  • GWP (Gift With Purchase): a typical retail approach: purchase this large gift and get this smaller one for free. A store will create something, usually lower in value and not normally for sale, that enhances the buyer's experience and motivation.