INDIVIDUAL INCENTIVES have always been about flexibility: Winners can go where they want, when they want, with whom they want. As this industry matures, here are the top five trends that have emerged:
- Drive-To Destinations
Terrorist attacks, heightened security, and SARs have made some people jittery about traveling far from home, leading to the growing popularity of individual travel certificates. “We're seeing increased interest in regional trips,” reports Karen Renk, executive director of the Naperville, Ill.-based Incentive Marketing Association. “Also for events or travel destinations that may be unique to the area where the winners live. This includes tickets to the local theater or a dinner package.”
Experience-related awards are also popular — certificates for things such as rock-climbing adventures, rafting trips, and gourmet cooking classes.
IExplore (www.iexplore.com), an expert in adventure and experiential travel, has entered the individual incentive market with 3,000 adventure trips that can be used for individual incentives. IExplore can also create customized trips off the beaten path.
- Part of Group Travel
More companies are using individual incentives for smaller dealers who can't sell enough volume to qualify for the group travel program. “Individual incentives help reward and touch more people in a company,” says Scott Walker, director of Hyatt Incentive and Promotion Certificates, Chicago.
For example, Creative Memories, a St. Cloud, Minn.-based company that sells photo storage and picture preservation products, runs three group incentive trips and incorporates individual travel into its sales recognition programs for its 75,000 sales consultants, both as an alternate prize when a winner can't attend a group incentive trip and as a way to award promotions. Individual travel is also used in conjunction with merchandise for quarterly sales contests. Each consultant is sent a color brochure that lists all the potential awards, including information about Marriott Individual Incentive products.
The company recently considered eliminating individual incentive travel certificates but got negative feedback from its consultants. “Many felt it would be detrimental to take travel out of the sales contest,” says Lucy Eisele, manager, travel, events, and meetings.
- Diverse Uses
Employee motivation and recognition, channel support, consumer and business-to-business promotions: Today, individual incentives are being used for all of these things. Other areas in which their popularity has grown: suggestion programs that involve generating, evaluating, and implementing employee ideas; employee referral incentive programs, which encourage employees to refer qualified candidates; and customer service programs to keep customer service and call center reps focused and motivated. Individual incentives are even being used for super achievers who have outgrown group travel.
“Individual incentives can be offered to every department in a corporation,” says Bill Downes, vice president of Atlanta-based Loyaltyworks, a performance and marketing agency. “For instance, human resources can implement an absenteeism and tardiness program using individual incentives. With group programs, it is very difficult to reward these segments.”
Hyatt's Walker says that he has seen a great deal of interest from the service-award segment of the industry. Historically, this was a segment that used merchandise, such as watches, clocks, plaques, and pens, but now “companies want to include the whole family in this honor — and individual incentive travel reward certificates allow this to happen,” he says.
- Short-Term Marketing Solutions
Companies looking to solve a short-term problem need a reward that is easy to administrate, and individual travel is increasingly becoming the marketing solution in this situation. For example, Bob Ryan, president of Memphis, Tenn.-based Travel Round, recently designed a three-month program for an electronics manufacturer that sells its products through distributors. The manufacturer wanted to promote a new product and did so by offering individual travel certificates when distributors hit different sales levels.
- Online Management
While this didn't exist a few years back, each of this year's winners of the IMA's Circle of Excellence Awards, which recognize businesses that effectively design and implement incentive programs to motivate customers and employees, used an online application.
The Online Incentive Council, a group of companies that provide online performance improvement solutions, surveyed 250 corporations and found that 61 percent had run an incentive program using Internet-based software for administration, fulfillment, or other purposes. When asked when they would consider using Internet-based software for future programs, 49 percent planned to do so within six months. Only one in five said online program management was not under consideration.
Why? Online incentive programs save money and time. “A traditional incentive budget consisted of 15 [percent] to 20 percent fixed costs that included things like point statements, catalogs, and all program communications. For an online program, those fixed costs are reduced to 3 [percent] to 7 percent — a substantial savings,” says Michael Arkes, CEO of Chicago-based Hinda Incentives. Also, employees like the easy access, as they can redeem points with the click of a mouse.
Online management has also simplified incentive programs offered to international salespeople. Before the Internet made this relatively hassle-free, reports on the qualification process and other updates had to be done through international mail, a timely, costly, and cumbersome process.
Following in the wake of the popularity of eBay, many online incentive companies are starting to offer auctions. Hinda's Web-based auction lets participants use their point banks to bid on items in an online product catalog. Winners have the opportunity to get more value for their points and enjoy the excitement of bidding for items they want. “Our auctions are definitely gaining in popularity,” reports Arkes.
Marriott recently entered the world of plastic with its TravelCard, a prepaid card that is available in denominations of $50, $75, $100, $250, and $500. It is valid at Marriott locations worldwide and can be used for accommodations, dining, spa treatments, or golf.
A key feature of the TravelCard is that it registers a running balance. If someone has a $100 card and only spends $90, for example, $10 is left on the card.
Marriott is also in the process of creating an e-certificate program, which should be up and running in a year, according to Peggy Whitman, CITE, manager, West and Midwest sales, Marriott Incentive Awards. “Individual incentives are a booming area of the motivational field,” she says. “It's no wonder: Travel creates precious memories.”
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