Corporate incentives appear to be on a slow but significant growth curve according to a recent study conducted for the Incentive Federation. Of the 835 corporate executives who participated in A Study of the Incentive Merchandise and Travel Marketplace, 32 percent used noncash incentives as motivational rewards in 2000, compared to 26 percent in 1996, when the last study was conducted. While this study was completed before the economic slowdown, it suggests that the marketplace will respond quickly when the economy heats up again.

Merchandise edged out cash as the most popular motivator, with 71 percent of respondents saying they use it as a motivational tool, compared to 69 percent who cited cash. Individual travel as a motivator rose from 38 percent in 1996 to 47 percent, and group travel rose from 29 percent to 42 percent. Overall, respondents are using a more varied mix of motivational programs than they did in 1996.

Survey participants spent $26.9 billion on noncash rewards in 2000; $9.8 million of that was spent on travel programs. The bigger the company, the bigger the expenditure for incentives: 53 percent of companies with 1,000 or more employees used noncash incentives in 2000 (compared with 38 percent in 1996). Thirty-five percent of the respondents said their 2001 budget for motivational programs will increase; 60 percent said it will remain the same, and 5 percent said it will decrease.

Sales programs were the most popular type of noncash incentive used by respondents (64 percent); followed by nonsales employee recognition awards (62 percent); business gifts (57 percent); consumer/user promotions (44 percent); and dealer incentives (33 percent).

Questions about the Internet were included in this study for the first time, and research showed that 15 percent of the respondents got help online for their motivational programs, compared to 35 percent who used the services of an incentive marketing company.

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