The companies spending some $8.4 billion annually on incentive travel programs are spread across business sectors, from manufacturing to service. Still, nearly three quarters of the nation's ten million businesses are not using travel or merchandise to motivate employees or customers, according to a new study of 1,013 executives conducted by The Incentive Foundation, a coalition of leading associations, manufacturers, and suppliers in the premium and incentive field.
The first comprehensive study of the incentive industry to be conducted in five years, it reveals that some percent of the nation's ten million business organizations currently use travel or merchandise to motivate consumers, company salespeople, dealers, distributors, and nonsales employees. Of the respondents who said they do not use incentive programs, almost all (93 percent) said they had not seriously considered the use of such programs in the past five years.
Of the respondents that use group travel, 46 percent represent a broad category that includes transportation, communications, insurance, and real estate companies; 44 percent are distributors or wholesalers; 29 percent are manufacturing companies; 22 percent are companies in the service industries; 15 percent are retailers; and 21 percent are in the "other" category, including construction, mining, and agriculture.
Other key findings: * Dealer programs represent the largest segment (48 percent) of respondents that use incentive travel, followed by sales incentives (42 percent), and programs for non-sales employees (ten percent).
* Companies with more than 100 employees represent the bulk (69 percent) of incentive travel users.
* In 1997, one third of all respondents planned to increase incentives for nonsales employees.
Two other recent studies found a similar percentage of companies using travel incentives. A survey of 96 incentive program decision-makers conducted for American Express Incentive Services by Hase/Schannen Research and Associates found 20 percent of respondents offering trips as rewards for their sales, dealer, and employee incentives, while 81 percent used cash (20 percent used merchandise). The annual "Third-Party Sellers Best Management Practices" survey of 30 companies by Silvermine Consulting Group found 37.9 percent of respondents use incentive trips; 65.5 percent use cash.
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