As a business owner, you’re constantly navigating different terms and techniques when operating your business. This can be especially true when it comes to the supply chain industry. There are terms that are used throughout the industry that can be confusing for owners to understand when looking to continue growing their business. And one way to grow your eCommerce business is by looking into reward fulfillment. In this article, we will dive into the definition of reward fulfillment and how it can work for your business.
The definition of reward fulfillment
Reward fulfillment is a form of logistics that helps incentivize your customers to become repeat shoppers and can be separated into multiple categories. In this blog, we will focus on three categories: marketing, subscription services, and prize sourcing. Each category can help you encourage customers to return to your shop by using unique strategies.
What is marketing fulfillment?
Marketing fulfillment is probably one of the most used among the reward fulfillment categories. This type of fulfillment is utilizing your kitting and packing stations to place promotional items into your customers’ orders in addition to the items they purchased. The most common marketing materials placed in orders are packaging inserts or “pack-ins.” Popular pack-ins include thank you notes, stickers, and business cards. Additionally, these inserts can be promotional materials that offer a discount or some other perk with the customer’s next order. By providing these incentives in your customers’ orders, you have the opportunity to increase customer satisfaction and return shoppers.
What subscription fulfillment really means
Subscription fulfillment is a form of shipping products to customers on a predetermined basis. These services can range from specific items sent to each customer to sending curated, customized boxes based on a customer’s need. With 71% of consumers expecting personalization from brands , subscription fulfillment is certainly something for eCommerce owners like you to consider to keep your customer base growing — especially if your products are easily bundled!
When you hear subscription fulfillment, you might think of this as subscription boxes like StitchFix and HelloFresh , which can seem daunting or overwhelming. However, providing subscription services does not have to be as complicated as this. A subscription service can be as simple as weekly or monthly refills. For example, Quip provides battery and brush head refills to their subscribers every 3 months. This eliminates the need for their customers to go to the store to pick up refills. And such a simple project doesn’t require too much additional lift on your fulfillment partner.
Prize sourcing: a gateway to increased customer engagement
Another form of reward fulfillment is prize sourcing. Prize sourcing can be achieved by providing giveaways or competitions for your customers to participate in. By providing giveaways for loyal customers, you can increase consumer engagement. For this category of reward fulfillment, it’s important to communicate with your fulfillment center or 3PL to ensure they have the right products on hand to quickly send out rewards to your customers. Or, for those eCommerce businesses that are self-fulfilling, it’s just as important to ensure that you have not only the products on hand but also the time and capacity to fill the orders for prize winners.
Are you thinking about reward fulfillment?
If you’re thinking about jumping into reward fulfillment, it’s important to think about which category is best for your business and aligns with your fulfillment center. Why? Each 3PL operates differently and each category of reward fulfillment requires different systems to ensure orders are sent out accurately and in a timely fashion.
Communicate with your 3PL
When you start your research on reward fulfillment, you need to start an open dialogue with your fulfillment partner. For starters, the 3PL needs to have a kitting area to properly handle each category of reward fulfillment. For example, Red Stag will work with you to place pack-ins into orders for your customers. However, subscription fulfillment requires an entirely different system to operate properly, a system that Red Stag’s warehouses simply aren’t equipped to handle.
Requirements for each reward fulfillment category
Subscription fulfillment requires a fulfillment center that can properly handle the personalization of each order. In some cases, it requires an operations team that solely focuses on your products to ensure the right products reach the right customers. However, this is all based on how personalized your subscription service is. For example, as mentioned before, you might be able to work with your current fulfillment partner if you are simply sending out replacements or refills monthly to your customers.
Like mentioned above, marketing fulfillment is the most common category of reward fulfillment. One reason for this is because of how easy it is to send out to your customers. It’s often as simple as slipping in a marketing insert during the packing process. It’s important to talk with your 3PL partner to see if they provide kitting services that can handle the pack-ins that you have for your customers. Not only do you need to discuss kitting services, but you need to discuss how often you will include pack-ins and the volume that will go out.
For prize sourcing, you need to have proper systems on the back end of your business to ensure your prizes are properly sent out to the correct customer. In most cases, businesses will outsource this feature to partners that understand the different levels of prize sourcing. How does your fulfillment partner come into play? Whether you prize source in-house or outsource, it’s important to talk with your 3PL to see if they have the right order management systems that can handle the prize sourcing.
Want to learn more?
If you’re still doing research, we have resources that can help! From definitions of supply chain procedures to an in-depth look at the subscription process, our blog has business resource articles that can help you improve your eCommerce business. Here are a few blogs to get started: