What Is a Reward System?

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A "rewards system" is a planned and structured approach to reward one or more persons who act in a desirable way. Company marketing departments often facilitate customer rewards systems or programs to motivate people to buy more or to purchase certain things.

A basic rewards system in an organization is the compensation and benefits programs it offers to employees. The point is to reward employees with financial remuneration to garner loyalty, consistency, quality and value in their work. Parents also commonly use reward systems with their children to motivate compliant behavior. A parent may give children stickers and prizes for doing chores, for instance.