Designing a rewards catalog trade partners actually redeem from

Ask a brand manager what belongs in the catalog and you get a mood board: branded jackets, Bluetooth speakers, coffee machines. Ask the redemption data and you get a very different, very consistent answer across paints, cement, electrical, lubricants and FMCG programs:

• UPI cash — the runaway leader for influencers (electricians, painters, plumbers, mechanics, masons, carpenters). When cash is on the menu, it typically takes 60–80% of redemption volume. It is liquid, needs no delivery address, and lands in the same account the family runs on.
• Gold — coins from 0.5g to 10g, and digital gold in smaller programs. Gold is the culturally trusted store of value: it is savings the spouse approves of, it photographs well at the annual dealer meet, and it peaks sharply before Diwali, Dhanteras and Akshaya Tritiya, and through the November–February wedding season.
• Smartphones — the single most redeemed merchandise item. A ₹10,000–15,000 4G/5G handset is both a family gift and a work tool; for a scanning-based program it literally upgrades the user's ability to participate.
• Kitchen and home appliances — mixer-grinders (₹2,500–4,000), pressure cookers, induction cooktops, fans, water purifiers, and at the top end refrigerators and washing machines. These are household-status purchases the trade partner might defer for years; the program lets him bring one home without a family budget debate.
• Two-wheeler down payments and accessories — a ₹15,000–25,000 voucher against a new bike or scooter is the most aspirational attainable reward for a working electrician or mechanic. Some programs partner with financiers so points settle the down payment directly.
• Insurance and financial protection — one-year personal accident cover (₹5–10 lakh sum assured costs the brand roughly ₹150–500 per person) or hospital-cash top-ups. Redemption volumes are modest, but perceived value is enormous for workers whose income stops the day they fall off a ladder — and it positions the brand as a protector, not just a paymaster.
• Trips — Thailand, Dubai, Vaishno Devi, Goa. Almost nobody "redeems points" for these; they are annual target-unlock rewards for the top decile. Their catalog role is aspiration and storytelling, not volume.

Notice what is missing: branded merchandise below ₹500, desk trinkets, and anything the partner could buy cheaper in his own market. Trade users price-check the catalog against Amazon and the local bazaar within minutes of first login. One overpriced mixer-grinder and the entire catalog is judged dishonest.

A well-built catalog is a pyramid with three deliberate layers, and each layer does a different job:

• Attainable staples (60–70% of catalog, redeemable within 4–8 weeks of normal activity) — UPI transfers from ₹100, recharge vouchers, small kitchen items, tool-kit components. Their job is proof: the new enrolee must experience one successful redemption in the first month, because a partner who has redeemed once behaves completely differently from one who has only earned. Programs that lift first-redemption rates from 20% to 50% typically see scan frequency roughly double in the following quarter.
• Goal rewards (25–30%, reachable in 3–6 months) — smartphones, 1g–5g gold, large appliances, bicycle-to-bike accessories. Their job is retention: a partner saving toward a named goal keeps scanning through the slow monsoon months when site work halves. Show a progress bar; "you are 68% of the way to the Samsung" is the cheapest retention message in loyalty.
• Aspirational anchors (5–10%, top 5% of users only) — 10g gold, foreign trips, large-screen TVs, two-wheeler vouchers. Their job is not redemption volume; it is anchoring. The ₹65,000 trip at the top makes the ₹12,000 smartphone in the middle feel reachable and makes the program worth talking about at the tea stall. Every catalog needs a headline reward the field team can hold up at influencer meets.

Regional tuning matters more than most brands expect. Gold indexes strongest in the South and West; cash and smartphones in the North and East; pressure cookers and stainless steel travel everywhere. Run the catalog by state after six months of data and you will find 20–30% of SKUs redeeming almost entirely in one region — stock and merchandise accordingly.

Fix the exchange rate and keep it sacred. ₹1 = 1 point is the easiest rate to communicate to a low-literacy audience and the hardest to manipulate silently. Some programs use 1 point = ₹0.25 to make earn numbers feel bigger ("400 points per coil!"); this works only if you never change it — a devaluation is experienced as theft and spreads through the trade WhatsApp groups within a day.

Price at landed cost plus fulfilment, not MRP. If the mixer-grinder retails at ₹3,500 but you source it at ₹2,600 landed, the honest point price is ~2,800–2,900 points (cost + delivery + a thin buffer), not 3,500. Pricing at MRP while sourcing at wholesale is how brands quietly claw back 25% of reward value — and how catalogs get exposed. The strongest programs deliberately price one or two hero SKUs below street price and let the trade discover it; that discovery does more for participation than any launch campaign.

Worked example. An electrician scans ₹40,000 of wires and switchgear a month on a program paying roughly 1.5% in points → ~600 points/month, ~7,200/year. Your catalog should therefore have: staples at 100–500 points (weekly UPI pulls), goal rewards at 2,500–8,000 points (the 1g gold coin at ~₹7,000-equivalent lands beautifully as a one-year goal), and anchors above 25,000 points that only the ₹2 lakh/month superstar reaches. If your median user cannot reach anything meaningful inside a year, your earn rate and your catalog are misaligned — fix the earn rate, or add lower rungs.

Keep internal price parity. Two items of similar market value must sit at similar point prices. Users cross-check; a 3,000-point kettle next to a 3,000-point smartphone accessory worth half as much reads as a trap.

Breakage — points earned but never redeemed — is a real budget line. If you issue ₹1 crore of points in a year and 25% break, your true reward cost is ₹75 lakh, and your CFO will want that assumption in the plan. Practitioner ranges: influencer programs with instant UPI run low breakage (10–20%, because cash gets pulled fast); retailer points programs with merchandise catalogs run 25–35%; poorly communicated programs run 50%+ — which is not efficiency, it is a warning light.

The ethics are simple to state and easy to violate under budget pressure. Legitimate: reasonable expiry with loud, repeated warnings; minimum redemption thresholds low enough that a median user clears them in a month or two; conservative breakage assumptions in the budget. Illegitimate: expiry designed to trigger just before typical accumulation reaches the smartphone; redemption windows that "open" only twice a year; catalogs where everything worth having sits above what 95% of users will ever earn; silent devaluation of the point rate. The second list produces one great quarter of P&L and then a dead program — breakage above ~40% almost always precedes a participation collapse, because trade WhatsApp groups do the forensic accounting for you.

Accounting note: unredeemed points are a liability until they expire or are redeemed; align the expiry policy with your auditor's revenue-recognition treatment early, not at year-end. Model the full cost side — earn rate, breakage, fulfilment, platform — in the loyalty program cost calculator before you publish a single point price.

Decide early whether you source rewards yourself or use the platform's fulfilment network. Self-sourcing saves 5–8% on hero SKUs but makes you a logistics company for 500-pin-code deliveries; platform fulfilment costs a margin but gives you catalog breadth, replacement handling and delivery SLAs on someone else's balance sheet. Most brands hybridise: platform catalog for the long tail, self-sourced for gold and the annual trip.

Then treat the catalog like a retailer treats shelf space. Review monthly: redemption rate by SKU, points-to-delivery lead time, complaint rate, and dead SKUs (listed 90 days, near-zero redemptions — delist them). Survey redeemers on WhatsApp one week after delivery with a single question. And watch what users almost redeem — items added to wishlists or viewed repeatedly but never affordable are your signal to add a lower-priced variant. A catalog is not a PDF you publish at launch; it is the storefront of the entire program, and it should be managed with the same energy as the schemes that feed it — see the retailer incentives playbook for how earn and burn sides fit together.