Top 10 Ways Points-Based Rewards Are Super Meaningful

When using nominal reward amounts in rewarding employees the typical options available to organizations are cash, points, and gift cards. Researchers have conducted many studies on the benefits of cash versus non-monetary rewards—what about points-based rewards? Further research by Dr. Patricia A. Norberg from Quinnipiac University in Hamden, Connecticut, provides insights from which these Top 10 Ways Points-Based Rewards Are Super Meaningful are based.

1.  People think about points more often. For example, individuals who receive reward points tend to think about and plan out how they plan to use them more so than reward recipients who receive cash or gift cards do.

2.  They’ll even talk about their points more. Think about personal loyalty points you’ve collected. Employees who receive reward points talk about their reward points more often than employees who get cash or gift cards.

3.   Point recipients report higher satisfaction levels. Employees who receive reward points report significantly higher levels of satisfaction with their reward than those reward recipients who got cash or gift cards.

4.   People receiving points remember how they used them. Employees receiving reward points were significantly better at remembering what they used their reward points for than those recipients receiving cash or gift cards.

5.   There’s a higher perceived trophy status with points. Employees perceive points at a higher currency ratio value than associated with cash rewards, making them more meaningful to employees to hold up with pride.

6.   Points get redeemed for more meaningful gifts. Studies show that cash gets used for more utilitarian and practical items such as bills and household necessities. Points get used for meaningful gift items that employees talk about.

7.   Using point-based rewards encourages greater engagement. Employees receiving point rewards engage more with company reward sites than cash, which appears on pay statements, or gift cards they have to top up to use.

8.   There’s greater potential of emotional appeal with points. Point-based rewards have greater emotional appeal to employees than cash. Emotional draw creates intrinsic connection for the employee with their company.

9.  Points generate greater social-emotional impact. If you want a rewards program to create better word-of-mouth promotion across employees and higher levels of employee satisfaction, then points-based rewards appears to fit the bill.

10. Nominal points-based reward programs work. By all accounts, points-based reward programs offer an all round memorable, meaningful, and motivational option to consider in your reward program planning. 

Recognition Reflection: Has the organization clearly defined the benefits of a points-based reward program to our employees?

How Intuitive Is Your Recognition and Reward Program?

Wow! You have a great online recognition and reward program all set up and people are using it.

But a few people have some concerns about how painless it will be to access.

Your program should have a friendly interface and be easy to use. Common functions should be accessible from a simple drop-down menu.

Now you are wondering how intuitive your recognition and reward program really is.

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A Dozen Ways To Educate People on Using Your Recognition Programs

Teaching people how to use your recognition programs takes time and effort. And the education opportunities are best if you repeat them in different ways at various times.

Try to set up the following ways to educate managers and employees on using your recognition programs. 

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How To Engage All Employees In Using Your Recognition Programs

Too often we rely on lines from Hollywood movie scripts that say things like, “If you build it, they will come.” Unfortunately, that doesn’t work very well when it comes to recognition and reward programs.

Look at the following ideas to consider when you want to engage all, or more of, your employees in using your recognition programs.

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What Is The Recommended Ratio of Recognition to Rewards?

Setting up business rules in the design and program strategy stage for a new recognition program can very interesting. I often get asked what ratio to set up for the usage of their recognition to rewards in their programs. 

My answer is always the same. It all depends. 

The thing is the answer really depends on the industry you are in and the need for using rewards or not, and many other factors. For example, a major Silicon Valley technology company will have a significantly higher ratio of rewards to recognition expectation than would a healthcare organization in Texas. 

Here are a few guidelines to follow that might help you.

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Remember To Tell People When and When Not To Give Rewards

Recognition programs coupled with the use of rewards can challenge managers and employees, especially when you just launch a new program. 

It seems managers and employees alike are like kids in a candy store. With a myriad of good intentions, they lavish out rewards on everyone. And the reasons are often spotty at best.

Which is why you must always handle your rewards with care. 

This matter has come up for a couple of clients in the last few months, so it seemed fitting to bring it up here as well.

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Why Recognition Needs To Be More Strategic Where You Work

One trend I am seeing with different clients over the last two years is the development of written recognition strategies. 

Organizations are leveraging a tighter mandate on recognition, especially when coupled with rewards in their programs. 

I’ve seen programs where lower-level reward amounts, whether point-based or gift cards, are opened up in global recognition and reward programs for employees to reward their peers. This can create problems when the cost of living is low in some countries and employees use the rewards more as a make up for lack of salary increases, rather than rewarding above and beyond actions. And some staff get into a tit-for-tat of “I’ll reward you if you’ll reward me” behaviors when controls or approvals are not present. 

So, why should recognition be more strategic in your organization? 

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The Right Balance of Recognition to Reward Programs

One of the many challenges in managing a recognition and rewards program is figuring out how to steer the course of your programs to maximum impact. 

And one repeated concern I see is when program owners inherit a program, they call recognition, but it’s been almost a total rewards program. Getting rid of the rewards mindset that triggers entitlement, expectations, and “more please”, is hard to unlearn. 

Providers, compensation and benefits associations, and non-profit business research organizations give good estimates on how much money to spend. They draw upon a percentage of your payroll budget or the average dollar spent per full-time equivalent (FTE) of employees. 

But what’s missing is how much to spend on the different programs. Is there a perfect balance between recognition specific programs and reward type program? How do you advocate budgets based on how people use the different types of programs? 

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How To Set Up a Point-Based Reward Program

Many people have clicked on a previous version of this blog post wanting to learn how they should set up a point-based reward program. 

Unfortunately, some individuals and recognition and reward providers suggest certain ideas as being best practices so the client’s employees will consume more points. So, buyer beware and let’s learn some principles versus supposed best practices to guide you.

My goal is to provide you with objective information along with solid principles for you to make wise decisions by.  I will also give you some pros and cons for some options.

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Build Your Recognition Programs From the Bottom Up

Designing and developing recognition programs take a lot of thought, planning, and creativity.

The best way I can recommend beginning is to consider the distinct programs falling under a pyramid. And like building most structures, the foundation is critical because it holds everything built on top of it.

That’s why you build your recognition programs from the bottom up. 

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