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Rewards program administrators can now dramatically lower their costs while increasing member redemptions and loyalty, thanks to PowerDeals, a new micro-redemption loyalty engine from Access Development.
Unveiled at FinovateSpring, a financial innovation conference in San Francisco, PowerDeals gives customers the opportunity to exchange small amounts of points or miles for merchant funded deals of up to 50 percent off at more than 300,000 local and national merchants. The model is designed to encourage more reward redemptions, resulting in happier, more engaged customers.
COLLOQUY’s 2011 Forecast of U.S. Consumer Loyalty Program Points Value reported that consumers amass more than $48 billion in points and miles annually, yet redeem less than a third of those. By encouraging more frequent, smaller redemptions, PowerDeals makes a positive impact on both the balance sheet and income statement for program administrators—lowering program costs and accrual liability.
“This is exactly what the industry is looking for—more engagement at a lower cost,” said Kelly Passey, Access’ EVP of business & product development. “COLLOQUY research shows the average American household participates in over 18 rewards programs, but is active in less than half of them. Obviously consumers’ needs are still not being met as programs often lack everyday value. And with the overwhelming majority of consumers saying they look for deals before making a buying decision, they clearly want help saving money, too.”
While program administrators often pay full price for the rewards they offer, such as gift cards and merchandise, PowerDeals cost a mere fraction of their face value because the deals are merchant funded. The result is a significant basis point cost savings for rewards administrators and increased engagement and loyalty from their members.
“PowerDeals are a clear win for consumers, because it combines superior value and savings with ‘micro’ redemption thresholds, which encourages frequent participation. And the deals are priced such that administrators will be rewarded for steering redemptions to our offering,” said Passey.
PowerDeals is designed to be simple, both for loyalty program participants and administrators. Members simply link to the white-labeled PowerDeals interface from their existing rewards program website. From there, members are able to browse the entire database of deals, which can be presented at the point of sale and accepted like any other coupon.
For more information about Access, PowerDeals and the Access merchant network, visit accessdevelopment.com and follow us on Twitter at twitter.com/AccessLoyalty.