The incentive and non-incentive classifications have their roots tied typically to the latter part of the marketing funnel of conversion.

How start-ups can combine objectives of brands and consumers through mobile marketing
Atom Marketing Wednesday, March 22, 2017 - 18:56

Entering the brave new world of mobile marketing, from a non-marketing one, may be daunting – but one with a distinct advantage. One can start from scratch; bottom-up with a first principles approach. There is entitlement to ask the most basic questions. Lateral thinking with a simple-minded approach is not blasphemy. A distinct advantage to have for innovators on the run.

Incentive vs. Non-Incentive - a Divided world

Investigating the taxonomy of marketing at work, it dawned on us that a particular classification is perceived as black and white – mutually exclusive. It is the classification of incentivized and non-incentivized marketing. 

Incentivized marketing is a process where the consumer is rewarded for typically engaging with a product, service, research or campaign. The gratification process is primarily the key driver for migrating from an impression or a view to engagement. In the typical funnel of awareness, consideration and conversion (deeper level opt-in), incentive may be used to create the traffic/awareness but is more popularly used for the latter. Typical real life cases are: installing mobile apps in exchange for reward, earning cashbacks on purchases, filling out surveys to cite a few. Non-incentive on the other hand, is where a consumer views marketing campaigns and engages deeper with no perceived reward in hand. In-stream or native ads on social media, mobile apps for news, music, and free version of games, are typically perceived as non-incentive.  Note that the usage of perceived reward in our description is deliberate and stemming from the fact that the traffic or awareness created even in these examples is actually with an incentive on part of the consumer. S/He is willing to play along with the intrusive ads, “in exchange” for the content or experience at hand. In exchange for ad views at Spotify, we get free music; on a social media, we get a shared experience of updates, photos, videos and more. So from a purist standpoint at this segment of the funnel (awareness/traffic), the engagement is incentivized. The rationale for us to classify the approach as non-incentive is because what matters to a brand or a business at the end of the day is the conversion.

In a nutshell, the takeaway of the introspection is that the incentive and non-incentive classifications have their roots tied typically to the latter part of the marketing funnel of conversion and we will use this as the base case for all practical purposes.

The Conflicting Objectives of the Stakeholders:

Now the primary player or stakeholder in marketing is the Brand or the business on one end of the spectrum and the Consumer on the other end. Marketing is the exercise of connecting the two entities, where the Consumer finds utility in the product or service at a price and the Brand finds a Customer in the Consumer.  The marketing challenge of either using an incentive or a non-incentive channel is that the objectives of the stakeholders are poles apart. The Brand aspires for a genuine, non-incentive engagement from the consumer, but the latter is looking for some form of gratification to engage deeper. It can be in the form of cash rewards, loyalty points, or equivalent – but most often in the broader economic sense – it is perceived value for the product or service consumed. Now, this in reality is a dilemma in marketing given that the starting points of a Brand and a Consumer are wide apart. How can one marry when the wants and expectations are divergent? This match-making problem statement is within the context of the success of opt-in or a deeper engagement as it relates to B2C marketing. In the grand scheme of things, it is a clearing price or point of equilibrium driven by demand and supply that brings the buyers and the sellers together.

(Dr. Manish Sinha is the Founder and CEO of Skrilo.)

Become a TNM Member for just Rs 999!
You can also support us with a one-time payment.