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From Airlines to Consumer Product Companies to Sports and Entertainment firms, more and more organizations are turning to online Auctions in general, and points-based online auctions in particular, as a means of reaching out to customers and building their brand.

Why you say?  I'm glad you asked...the reasons why are varied, but all tie back to the elusive challenge of keeping that all important returning customer coming back again and again...So here then, are the top reasons why marketers see value in adding online auctions to their eCommerce and Online Marketing toolkit:

Reason #1 – Airlines/hotels and other companies that reward customers with points or loyalty rewards need these loyal customers to continue to redeem these points. Often loyalty points are viewed as a liability on an organizations P+L and most naturally want to encourage their redemption. Auctions are an effective method to encourage this.

Reason #2 - These organizations need to engage their customers with interesting new ideas and products and provide compelling reasons to return to their respective .coms. Auctions have historically proven to be sticky application providing an ‘entertainment/game’ like functionality the respective web sites. Average time spent on auction sites by customers is significantly higher than on traditional eCommerce sites -- often 3 to 4 times the average session time

Reason #3 - Airlines/hotels and other companies that reward customers with points or loyalty rewards can often leverage existing partnerships and relationships they have already developed for prizing and products for their online auctions.

For example Priority Club Auctions has an arrangement with Major League baseball (MLB) via Holiday Inn as the official hotel of Major League baseball. They utilize this relationship for prizing such as tickets, once in lifetime experiences and signed baseball memorabilia

Reason #4 - Many organizations want the ability to communicate directly with their customers on a frequent and consistent basis. Auctions provide this level of communication by the very nature of the auction environment i.e. email upon registration, email upon bid, email upon out bid, etc.

It is a pretty safe bet to say that Loyalty Points Auction programs are becoming a required piece of site functionality for any company that is developing or has developed an extensive program that rewards customers with points or miles.

Posted at 11:45 AM in Auctions | Permalink