The Gratification of Instant vs. Deferred Rewards

by Chuck Martin on May 16, 2013

Receipt-Tape-BBy Chuck Martin

Companies continue to find innovative ways to incent and reward mobile commerce behaviors.

Visa this week introduced an enhancement to its Visa Offers program, which allows merchants who take Visa credit cards to send targeted rewards to Visa cardholders.

After a consumer opts in to receive offers — another totally separate challenge in itself — merchants can send targeted offers to Visa cardholders.

I can’t count how many mobile entities are aiming to enable targeted offers to consumers based on their location, context, past behaviors and the like.

The interesting catch here is that the rewards are instant and noticeable, not in the mobile but in the physical world.

The neat twist Visa added is that at the point of sale, the real-time redemption of coupons or offers can be seen on the receipt.

Credit card discount ties into mobile commerce typically result in credit applied directly to the credit card account. This method can work well, since no salespeople have to be trained or even involved. But the reward may come weeks later.

For example, when a Foursquare restaurant check-in results in an American Express rebate if

more than $20 is spent, the restaurant does nothing while the knowing consumer receives the credit on their next AmEx bill. Nice savings for a consumer and good support for an American Express-using establishment.

But the Visa approach adds a new dimension of immediacy. The reward can be seen at the highest moment of value:  when the actual money is being spent.

I’ll be very interested to see if there ends up being a difference in this instant-reward approach compared to the deferred reward tactic.

All of these incentive approaches to modify consumer behavior around mobile commerce may come down to the value of instant gratification.

I’m not sure whether it’s the instantaneous nature of the reward given or the if the magnitude of the reward trumps timeliness.

What do you think? Timeliness of reward or size of it?

 Chuck Martin is editor of the mCommerce Daily at MediaPost and writes the daily MobileShopTalk column. He is the author of “Mobile Influence,” “The Third Screen,” and “The Smartphone Handbook.” He is CEO of Mobile Future Institute and a frequent mobile keynote speaker and mobile marketing speaker internationally. 

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