A bonus scheme is a strategy used by companies to motivate employees and attract/retain customers. It offers rewards beyond standard salary/benefits and creates incentives to continue the relationship. It benefits the company by increasing productivity/profit margins and building strong relationships with customers.
Also known as an incentive scheme, a bonus scheme is a strategy that is used by companies in two different ways. One approach centers on employee motivation in the workplace, up to and including incentives that help keep employee turnover to a minimum. A second application of the bonus system is focused on consumers, with the aim of attracting and retaining customers by motivating them to buy more of the supplier’s offers. Both approaches focus on offering something to the target audience that is above and beyond what is considered standard, creating an incentive to continue the relationship.
In relation to employee motivational programs. A bonus scheme often involves setting up some sort of short- or long-term event that offers a reward beyond the standard salary, wages and benefits enjoyed by employees. For example, sales personnel may be offered the incentive to increase sales to a certain level in order to benefit from the possibility of receiving an extra week of paid vacation, or even an all-expenses-paid vacation to a destination desirable. Incentives offered to different levels and departments of employees would be in line with their duties and would offer something that would provide a desirable benefit. Even simple bonuses like free meals at local restaurants or a paid day off can be used as part of this motivational approach.
In terms of branding strategies, a bonus system usually has to do with strengthening ties with consumers, so that they receive some sort of added benefit from purchasing the goods or services offered by the company. Sometimes, this may involve teaming up with others to offer some sort of added incentive. This means that the manufacturer of a line of ketchups and other condiments can partner with a bakery to offer customers incentives to purchase a certain number of products in order to also receive a loaf of bread or a package of hamburger buns. Similarly, companies can offer discount coupons or rewards programs that can be redeemed later for products that consumers find appealing.
In each incarnation, a bonus scheme is designed to benefit specific recipients and enable the company to in turn receive some return on their efforts. As it applies to employees, the company benefits from happier employees who tend to be more productive which in turn increases the profit margin of the company and also helps encourage valuable employees to stay with the employer . As a marketing tool, a bonus scheme can increase consumer awareness, build strong supplier-customer relationships and also increase the chances of good word of mouth which in turn increases business volume.
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