Rewards PROMOTION Strategies:
 
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Theory of Rewards Programs:

•	Why Monitor customer loyalty and buying frequency:

Business establishments rely on repeat customers.  A sense of fairness, quality, and preference heighten a patron’s comfort with a business.  The Rewards system is designed to help differentiate one business from its competitors.  Strategies in the ‘Rewards’ system can take several forms but in general reward the customer for frequent buying of specific products or for the amount of money spend over time.  The ‘Rewards’ system augments other promotion utilities such as coupons, senior discounts, mix/match discounts, ADVANTAGE discounts (mixed strategies such as buy 5 get 1 free) based on member buying, employee discounts, and so on.  Most promotion strategies are based on matching discounts to what they buy at the time of purchase.  The ‘Rewards’ system accumulates buying and allows promotions based on repetitive or frequent buy habits.

Processing Sequence:

•	Processing Events—Point Accumulation:

A PLU (touch point) named *Rwards when struck displays an entry dialog asking for a member magnetic card swipe.  The card identifies the member.  Each dollar of sales is accumulated into a reward summation.  Redemption of rewards points is left to the merchant’s discrimination.  Points may be redeemed as discounts on food, merchandise, services, gift cards, etc.  Historical information is provided to allow selective redemption and customer promotions.

Processing Events—Item Rewards:

An item level stratagem could be as easy as buy 10 cups of coffee and get the 10th cup free.  To configure this strategy, a manager would go to the Option#1 on the point of sale terminal, strike the ‘Edit Rewards Strategies’ touch point.  A dialog appears with a PLU list to the left and a STRATEGY list to the right.  Select a PLU and a edit dialog displays at the lower margin.  Enter the item count in the DEAL box and select ENTER.  This strategy adds to the right side list.  Selecting ACCEPT will store the rewards list to the system disk.  This active list is distributed to all terminals in the network automatically once a day or when terminal constants are reloaded under manager control.

The current strategy list supports 40 PLU/STRATEGY combinations.  A strategy file named S_Rewards.csv is maintained in the POS directory of the file server.  This file can be updated using a common editor (such as edit, wordpad, notepad, etc) or through the POS terminal as explained above.  

Item redemption as a Terminal Operation is for the most part completely automatic.  The customer offers the ‘Rewards’ card to the operator.  The *Rwards request is made, a dialog appears, and if an item in their purchase matches the active strategies and the accumulations are satisfied, one of the items in the buy is repeated with a negative price (thus eliminating an item).  The reward item is printed on the receipt.  The sales accumulation shows a redemption for the item times the DEAL requirement.  For example, buy 10 at 1.55 and get 1 free, would show a redemption amount of 1.55 times 10 or 15.50.  When a deal is realized, the summation for the particular card-item is set to zero (0).  The redemption process follows the card and the card-item accumulations are automatic and require no operator intervention.

Processing Events—Funds Rewards:

A client has, for example, accumulated 150.00 points.  A provision in the system allows these points to be redeemed as media (media being a method of tender).  An example would be to convert points at a ratio of 100 to 10; therefore, the client with 150 points would receive 10$ against purchase at the time of redemption.  The system would reduce the clients point balance to 50 when the redemption was accomplished.

Processing Events—Funds Rewards Setup:

Special Functions in this systems can be selected using the short description field that is formatted in a particular manner.  REWARDS functions start with the short description formatted as ‘*Rw^^^^^’ where the first three digits are significant (i.e., ‘*Rwards ‘).  To allow points redemption as media, put the amount of reward ($10.00 in the above example) in price field 1 and the required points to allow redemption in price field 2 (100.00 or 10000 in the above example).  The *Rw key can be duplicated with different PLU numbers to accommodate various redemption strategies.  The *Rw keys with the price field set accumulate points from the sale in progress.  This media redemption *Rw can use names such as ‘*Rw Cash’ or some other character combination to identify to an operator that this key is a media redemption function.

•	Collection of Personal Information:

The ‘Rewards’ system is card oriented; however, a database record is provided for customer information such as name, address, birth dates, etc.  This information is optional, but can be used for mailings, notices, advertising, and so on.  The collection of this type information is normally done after the rewards card is issued.  A copy of the original receipt shows the card number.  If an information sheet is filled by the customer, then this information can be entered into the system through the Option#1 path on any network terminal in the POS system.

CAUTION Regarding Rewards Use and Auditing:

The Rewards information (histories and accumulations) are store in a relational database either on the local POS network or a remote server with Internet access.  If the remote option is selected, many facilities can share the query capability.  

Support utilities are provided to allow editing the database and to verify integrity of cards.

Stored Value (or Gift Cards) can be used for ‘Rewards’ cards.  Thus the business can have dual use of these cards to save expense and encourage use. 

 
Rewards Specification and Setup Instructions:

Strategy 1: Buy accumulative items to limit get item reward.
	
	Example:  When a 10 car wash limit is purchased, the eleventh car wash is free.  This buy limit get one free strategy is set in the Strategy design dialog and is unique per item PLU.  If car washes cost $5.oo each and the requirement was 10, the eleventh would be free with 50 points redemption.  This strategy assumes one dollar purchase is worth one point for redemption purposes and reward function has the PLU name *Rward.

Strategy 2: Buy accumulative weight item to limit get weight reward.
	
	Example:  A limit of 100 ounces of yogurt once purchased would reward the dollar cost of 10 ounces.  If yogurt sold for $.49 per ounce, a 10 ounce reward would be $4.90 with redemption points of 49.00.

	The [LIMIT] variable for 100 ounces is set in the Rewards Strategy associated with weighted item for yogurt PLU [say 11101].  The setting would appear as Purchase 11101 Required 100 Sum 1.  The reward weight variable is set in the yogurt PLU fourth price field as .10.  The quantities used in this example are for demonstration purposes only and *Rward if the reward key name.	 

Strategy 3: Buy accumulative ($) value to limit get value ($) reward.
	
	Example:  Accumulative $100 of apple purchases would reward $5 and redemption of 50 points. 

	The strategy $REWARD $LIMIT use price fields 1 and 2 respectively of the reward key PLU for reward and limit variables.  This strategy is not defined using Strategy Design entries.

Strategy 4: Buy accumulative ($) value to limit get Redeem ALL points as ($) reward.
	
	Example:  Accumulative limit of $100 apple purchases and the select to RedeemAll which would reward $10 and redemption of 100 points. 

	This Redeem All strategy uses price fields 1 reward key PLU for $ limit variable.  This strategy is not defined using Strategy Design entries.  At the time of posting a reward, the operator decides when to select Redeem All.

Caveat:

1. Strategies 1 and 2 automatically issue rewards when limits are satisfied. 
2. Rewards do not exceed ticket amount due (ie, no money back).
3. Multiple strategies can operate at once if unique key names (ie, *Rward, *Rw$, etc) are used (digits 4-8 must be unique).
4. Accumulations are tied to the client reward database record.
5. Clients can receive rewards from different strategies and products being tracked.
6. Client reward and redeemable point histories are shown when sales are posted.
7. Client rewards records can be queried via Reward cards, phone numbers, eMail addresses, and manual entry of identification numbers.