Points Based Rewards System – How They Work So Well?

One of the most powerful and effective ways to motivate and reward employees is with a points rewards based system. They work well to drive organizational outcomes like engagement, productivity, and retention.

Points Based Reward Systems - How They Work So Well?

Why do they work, though? And how do you make a rewards program that is based on points?

In order to answer these questions, this blog goes into more detail about:

What a system based on points is,

Why it works to help workers reach their fullest potential,

And what you can do next.

Let’s start.

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What is a rewards system that is based on points?

With a points-based reward system, you can give someone reward points to show how much you appreciate them. It’s a real way to show appreciation, and each point is worth a certain amount of money. So, when employees get such rewards, they feel great.

But let’s say you’ve earned points for doing a great job at work.

How do you plan to use the points?

Let’s check it out.

How to Use Your Reward Points

Now comes the good part.

Reward points give employees the freedom to choose the reward they want. They can trade in their points for your favorite items, fun experiences, and gift cards.

It makes more sense to let employees pick their own rewards. Also, it gives them a feeling of excitement. Employees can save their points until they find a good reward that they want to spend them on.


Employees can use their reward points to buy a wide range of goods from well-known brands around the world. In merchandise stores, you can find clothes, shoes, home decor, electronics, accessories, sports gear, and many other things.


Employees can also use their reward points to book trips, events, and other experiences that are fun and adventurous. To make reward points usable for booking, the company only needs to work with vendors who offer travel packages.

Present cards

In a recent survey, workers were asked to pick their dream reward for reaching a work goal. 44 percent of those who answered said they would strongly prefer a gift card.

One of the most popular ways to thank employees is with a gift card, which is easy to add to a points-based rewards system. It’s like a prepaid debit card with a certain amount of money that you can use to buy different things. Using reward points to buy it gives it value.

In the points-rewards program, there are two kinds of gift cards that can be used:

Closed-loop gift cards can only be used at one store or with one brand. For example, gift cards for a certain restaurant can only be used at that restaurant or other locations of the same restaurant.

Open-loop gift cards usually have a credit card network logo on them, like Visa. These cards can be used for multiple brands unless they say otherwise.

Why Rewards Based on Points Work

An SHRM study found that giving employees flexible rewards like points makes them more interested in their jobs. This could be because points turn the process of giving rewards into a game. It means that employees can see how their actions can lead to rewards, which makes them more motivated to move up to the next level.

Also, one of the main goals of point-based rewards is to take the focus off of cash-based incentives.

Yes, it might be nice to get a big sum of money when you reach a goal. But sometimes money isn’t enough to get people to do things.

Cash prizes are often lost in the shuffle. It might be spent on bills or other routine things that have nothing to do with the behavior that earned the reward.

But reward points let employees buy something meaningful with their money that they wouldn’t normally buy. They can use points to get something right away or save them up to buy something later. So, every time they get a prize, they’ll be able to use their points to get something real.

The points-based rewards system also gives employees the freedom to choose the rewards they’re most interested in. This makes people in the workforce feel excited, which makes them act in a good way.

7 Good Things About Reward Systems Based on Points

Point-based rewards are highly recommended for companies with employees all over the world who want to show their appreciation.

Using point-based rewards as part of your rewards and recognition strategy can be very helpful in many ways. These things are:

1. Higher Engagement

Since the reward points are worth money, when employees get them, they feel great. It turns the process of recognizing them into a game, which keeps them interested, happy, motivated, and working.

Employees will feel like they have accomplished something when they are recognized. This is true whether they are working to meet a deadline or to reach a goal. They’ll look for ways to earn and save up more points so they can trade them in for prizes with a higher value.

2. The global workforce is easy to spot

Today, a lot of companies have workers in different parts of the world who still work together. With an in-house recognition program, it’s hard to find a way to thank these kinds of employees.

A digital reward system based on points makes it easier and faster to show appreciation for employees who work in different countries.

3. Being Adaptable

Points-based programs can be changed quickly to meet the changing needs of the company, the goals of the program, and the preferences of the employees.

This is how:

You can give awards for different things that are important to your business, such as innovation, meeting goals, good customer service, hard work, and so on.

Also, workers are free to choose how they want to spend their points.

You don’t have to have a “one size fits all” program where you just give gift cards. You can look into other options, like giving away goods or experiences.

If your company has employees from all over the world, SOLI-based rewards programs can help you convert points into major currencies.

4. Easy for staff to understand

Points-based programs are also easy for employees to understand, which is another benefit.

Most people already know how to get points from stores, credit cards, and online shopping sites. So, you won’t have to spend a lot of time training them to explain the idea to them.

5. Enables Frequent Recognition

A point-based reward system makes it easy to show appreciation to employees often. Throughout the year, you can give employees reward points for doing what you want them to do.

Also, rewards based on points are a good way to show appreciation quickly. It might not make sense to praise a worker for something they did months ago. This is because praise works best when it comes right after the behavior you want to encourage.

6. Track metrics and measure impact

Most reward point systems do more than just motivate employees. They also help you keep track of metrics like productivity and performance. The data on how points are used shows a lot about how engaged employees are.

You can find out about:

Who is getting the most money?

Who doesn’t give or receive points?

If the money you’re spending is being put to good use, etc.

And do what you need to do.

7. Points make awards more valuable

People who took Glassdoor’s Employee Appreciation Survey said that if their boss showed appreciation, they would work harder. But when you add money to that appreciation, it helps the appreciation go even further. Think of it as a type of motivation called extrinsic motivation, in which employees focus on the reward they will get for doing a task.

Employee Rewards and Recognition Program

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