Rebates, or money-back incentives, have long been a powerful — and possibly underutilized — tool for marketers. At The Jakes Group, we’ve worked on marketing campaigns designed to leverage the power of these incentives for businesses and end users.
Because of the Inflation Reduction Act of 2022, we’re now revisiting the benefits of rebates tied to energy efficiency. This bill is packed with tax credits and rebates for Americans to not only buy electric vehicles (EVs), but also to install heat pumps, better insulation, and even solar panels. The proposal for the FY2022 Budget Reconciliation bill presented an investment of approximately $369 billion in Energy Security and Climate Change programs over the next ten years. As a part of that, thousands of dollars are available for individual U.S. households to advance and update their homes to make them more energy efficient.
The challenge surrounding these programs is to bring relevant information to consumers that will educate and encourage action when appropriate. In our experience, rebates are a unique marketing opportunity and tool in that they provide benefit to both the seller and the buyer. For customers, a refund or credit offers them dramatic cost-savings, not only on the upgrades, but over time as those investments lower their energy bills.
And, for businesses, offering rebates proactively can differentiate their product or brand from competitors. Rebates can also be used to target specific customer segments. In the instance of energy, rebates might provide incentive for those who have older homes and have considered upgrading their energy systems, but just haven’t been moved to act yet. Rebates can be a great way to move price-sensitive customers forward. But to take action, they must be aware of the offers and understand the considerable value of taking advantage of them.
When promoting rebates, here are a few fundamental issues that can influence the success of the program.
- Make rebates as easy as possible to understand and use. Rebates come in a variety of forms, ranging from simple cash-back offers to more complex rewards programs and can seem confusing to both the seller and the customer. And confusing rebates typically aren’t something anyone wants to spend a lot of time untangling. Cash-back offers and other simple rebates are usually the easiest for customers to understand and use. Other types of rebates may include points programs, which allow customers to accumulate points for every purchase they make, or discounts on future purchases. Whatever the actual program details, marketing needs to ensure the offer is both easy to understand and take part in.
- Make the terms and conditions of the rebate offer very clear. When creating an educational marketing campaign, the rules and regulations associated with the rebate need to be clearly and accurately detailed, including expiration dates, minimum amounts, and any other restrictions. Packaging the full details of the rebate offer in all marketing materials can help ensure that customers understand the details and take advantage of the offer.
- Promote rebates offers to customers. That may sound a bit elementary, but consumers often misunderstand or aren’t even aware of rebates. Rebate programs succeed when customers know the benefits of the program and know how to fully participate.
Rebates can effectively increase sales and loyalty for a wide range of businesses, but particularly energy-involved businesses given the recent changes in legislation. By educating customers on the value and specific benefits of rebate offers, everyone has something to gain.
If you want to know more about how we’ve helped clients build successful rebate marketing programs, please reach out. We are always happy to talk about marketing your specific marketing challenges and aspirations.