promotional spend

Rethinking Promotional Spend ROI

  • May 29, 2017

The question of Promotional Spend Return on Investment (ROI) has always been prevalent among CMO’s and channel marketing managers. Obviously, the greater the monetary return – the better the program, but the question is usually one of how to best measure the true return on promotional spend.

In today’s business world, measuring solely for financial impact isn’t cutting it anymore. People want a bigger competitive advantage in their respective markets, and they can’t do that solely based off bigger incentive numbers.

It’s time to rethink how you measure return on investment.

Your program should be supplying you with more than just financial profit, but additional outcomes you can use to help your brand grow and thrive. It should build brand advocacy, deter fraudulent behavior, increase brand awareness, and more.

Here are three core features your SPIFF program should be delivering:

Consumer Insights

Consumer insights are imperative to understanding your customer base and successfully marketing your brand. We live in a consumer-driven economy where not only are consumers are more demanding than ever, they’re more informed, and they’re more vocal. In order to successfully sell your product, you need to target their needs and provide the best service you can.

Organizations already spend a great quantity of time, resources and capital to understand their consumers. So why not, if available, leverage an incentive program in the same capacity. A rebate program possess the ability for people to willingly input information into your system. The return on investment is then being armed with knowledge and detailed information on your consumer base, to drive further successful marketing operations and incentive programs. A revolutionary return on investment.


Gaining a better view of your risk and compliance structure is a definite return on investment. Fraud and non-compliance can cost the average company millions of dollars in wasted promotional spend that could be used for additional incentive programs. In-house compliance tactics such as random auditing of only about 5-10% of incentive payouts, are as effective as hoping to win the lottery. Best in class incentive vendors check 100% of incentive claims for fraud/non-compliance before a claim is paid out and without slowing down the payment cycle.

A huge return on your investment.

Increase Promotional Spend Incremental Margins

Driving increased capital and the bottom line is what most VPs and CMOs look for within a SPIFF program. They want to know how they can grow top line sales from the incentive program to boost their bottom line.

An incentive program can equip you with real time data so that you can see what is working for your organization and what isn’t. This allows you to make appropriate changes when necessary, and maximize revenue, but consider the growth opportunities in the above two points.  Collecting program data allows for experiment

Collecting program data allows for experimentation with varied consumer or sales incentive amounts and many companies are very pleased to find that they are able to actually drive the desired program results even with the use of lower payouts.  The collection of program data is key here; without data collection, you lose the power to experiment with different amounts and make these determinations.

As with the ability to lower payout amounts, there are significant gains to be had through fraud reduction.  While brands are free the money saved through audit to further fund their programs and pay out more claimants, they are also free to keep it.  By funding more claims, brands have attributable gains in sales and by holding the savings, they reduce their total cost of sales – either way, the result that emerges is a measurable ROI on the program.

Incentive programs additionally offer product knowledge for sales associates, they engage the channel, increase communication, and build brand advocates. All factors that work towards increasing mindshare on the sales floor to reel in a larger revenue stream.

Measuring Promotional Spend ROI

A final consideration here; the main reason for reconsidering how your organization calculates ROI on incentive programs is that you are now able to build unprecedented points of leverage into the programs.  Whereas previously, incentives were a necessary evil and simply an added cost of sales, your brand can now view incentives programs as a way to build up a powerful database of consumer and channel data that will help you continue to drive more and more sales and you continue to refine your programs based on your learning.  Perhaps your company used to spend money on consumer intelligence gathering or running focus groups with channel partners?  These can now be rolled into your incentive claim process.  The best part?  Instead of being a simple expense to your company, each survey you integrate with an incentive claim workflow is attached to a sale that has already happened.

When choosing an incentive provider or building an incentive program it’s important to consider all the ways in which the program can cater to your organization’s goals and objectives. Reaping only financial benefits isn’t cutting it anymore, and building an incentive program without a clear vision can be detrimental.

It’s time to consider different ways of evaluating ROI, and start utilizing your incentive program so your organization can become triumphant.

Join the Discussion

Have something to add to this topic?

Wondering how you can sell in the COVID shortened sales cycle?

Learn tips on what you can do to secure your #sales with Taylor Macdonald, SVP of Channel Sales at @Sageintacct, in the new episode of #ChannelEdge.

Listen to the full episode here:

Do you know who is the most impactful person in the buyer's journey?

Unpack the #buyer’sjourney and its relation to #marketingenablement and #investments with @forrester's @MariaChien and our own @StevenKellam6 in a #interactivedialog.

Watch it here:

Join us on April 27th as our UK Marketing Director, @dgould1969, hosts a LinkedIn Live Event to discuss all things #PartnerEnablement.

You won't want to miss it. Sign up to join the discussion now:

#partnerengagement #partnerjourney

Do you know the impact a successful channel incentive program can have on your business? Learn about all the benefits of an incentive program in our newest blog.

Read all about it here:

#Salesincentives #ChannelIncentives #ChannelEngagement

Load More...

What do you believe is the channel’s biggest challenge today?

Upcoming Channel Events

Are we missing an event? Tell us about it.

Channel Partners
May 4-7, 2020
September 8-11, 2020
Channel Focus
Nov 17-19, 2020
360insights Relevance