Incentive-Reward Preferences: What’s Age Got to Do with It?

Which incentives will motivate your employees to dig deep, make an extra effort, and perform at their best? Shaped by individual circumstances and expectations, a straightforward answer can be elusive. However, the Incentive Research Foundation is on a mission to shed light on the topic, and a recent report looks at the question in terms of career stages.

For the white paper, titled Generational Expectations of Incentives: Incentive Rewards for a Rapidly Changing Workforce, researchers surveyed 939 North American workers: 230 in early career (ages 18 to 30), 499 in mid-career (ages 31 to 50), and 205 in late career (ages 51 and older) to where if there are differences and similarities in reward preferences.

When asked what form of a reward worth $500 they would prefer, all respondents, regardless of age or income level, included two reward types among their top choices: gift cards and cash. The third-ranked preference for all groups was time off from work, rating above travel, gym memberships, and points. While travel is typically seen as a strong motivator, the researchers attributed the weak response to the low reward figure specified in the question.

Travel held much stronger motivational appeal when attendees were asked about their most preferred rewards, excluding cash and gift cards. For this question, attendees chose their top three types of rewards among the following: individual travel, group travel, time off, flexible work arrangements (ability to work remotely two to three days a week), career/learning opportunities, dining, experiences, merchandise, culture of recognition, and a sincere thank you.

Top Choices (in order):

Early-career workers
Time off (64%)
Individual travel (59%)
Flexible work (51%)
Career/learning opportunities (30%)

Mid-career workers
Time off (67%)
Individual travel (60%)
Flexible work (54%)
Merchandise (31%)

Late-career workers
Time off (59%)
Individual travel (58%)
Flexible work (44%)
Dining (34%)

The preference for individual reward travel over group reward travel was stark, with only 11 percent of early- and mid-career workers and 13 percent of the oldest respondents picking it among their top-three reward preferences. Yet group incentive travels are typically preferred by organizations for their relationship- and culture-building opportunities.

When considering group-travel rewards, respondents of all ages showed a clear preference for having relaxing and unscheduled time versus trips that have a busy agenda with a lot of social activities. “Perhaps the greatest reward for a high achiever who qualifies for an annual group travel reward is time to unwind,” the report states. “Knowing reward earners’ preferences, however, designers might consider an agenda with more unstructured time, perhaps with breakfast meetings and just one or two evening events so that participants have their days and most of their evenings free. Designers might also offer optional experiences, such as hiking, golf, water sports, etc. Venues might be chosen that encourage spontaneous social interaction, such as around firepits or pools.”

Researchers included seven questions where respondents selected between rewards A and B (see below). The results drive home the preference for time off, gift cards, and cash at all career stages but reveal some subtle differences. For example, respondents were asked to choose between five days of personal time off for a luxury travel reward with their partner or the cash equivalent of the trip plus the PTO.  While 76 percent of late-career workers preferred the cash/PTO choice, that dropped to 61 percent for early-career workers.

Generational Expectations of Incentives also looks at preferred destinations for group travel, how employees want to be recognized (awards ceremony, team meeting, newsletter, etc.), whether they favor individual or team incentives, and more. It can be downloaded from the IRF website.