The traditional incentive travel model in the insurance and financial services industry could use a boost. Can your field force wait 18 months or more for the reward of attending your conference? Consider the industry today:
- It’s tough out there. Your field force is struggling because their customers are struggling. Can advisers maintain their best efforts over a year or more without some extra motivation?
- A demographic shift is well under way. Limra (formerly the Life Insurance Marketing Research Association) puts the average age of advisers at 52. They’re entrenched in the traditional incentive model. But what motivates the younger, incoming crowd?
- Most insurance companies are now public companies. That means quarterly earnings reports and quarterly pressure to keep the numbers up.
- Some companies are still flying under the radar, and have not brought back their full schedule of incentive conferences. Can they achieve their conference goals without the conference?
One answer to these challenges lies in the creative use of individual incentive travel awards. “Individual travel provides benefits that connect to current lifestyles,” says Jim
Dittman, president, Dittman Incentive Marketing, New Brunswick, N.J. “The majority of households have dual earners, and it can be difficult for the spouse to get time off at the exact time that a winner’s group trip occurs. Many couples want to take their children with them, and individual travel allows them to do that.”
Complement the Group Program
Most buyers and suppliers of individual travel awards see them as pieces of a total motivational strategy that includes a group conference—not as a substitute for that conference. “While individual travel has replaced group travel in the past year in many places, it will not replace it in the long run,” believes Dittman. “It is not intended to. Group travel melts the formal barriers of business relationships and transforms them into personal ones through shared experiences. It allows the sponsor to recognize each winner and to create memories that will be forever associated with the sponsor. There will always be enormous benefits in group travel that make it an all-powerful motivator.”
Likewise, Scott Walker of Hyatt Incentive Rewards sees individual travel as part of a larger strategy. “The corporate world is looking for engagement, not just rewards,” he says. “This becomes a bigger process than just a prize at the end of a contest. Companies are looking for a comprehensive solution.” Hyatt offers many products in different tiers and can help planners work with air and car partners as well.
Ken Juel, who uses both individual and group travel, notes that incentive trips as a whole are new for TD Ameritrade. The group trip, for the top 40 consultants and guests, is just 5 years old. But it’s been successful, and at the 2009 conference, Juel saw increasing camaraderie among repeat qualifiers. “The individual and group trips complement each other,” he says.
The overwhelming majority of investment consultants working for TD Ameritrade are in their 20s and 30s, says Ken Juel, manager, sales incentives and recognition programs. As such, they respond especially well to individual incentive travel. “They like to choose the time and place they travel,” he says. “Younger agents don’t have as much vacation time, and their spouses don’t have as much vacation time, so the flexibility is a huge win for them.”
Likewise, Patricia Kerr, CMP, director, distribution sales support, at Manulife Financial, sees the use of individual incentives as part of a strategy to meet new competitive challenges. “In 10 years, the average adviser will be in his or her 30s and is cut from a different cloth than the traditional adviser,” she says. “The 55-year-old is driven by a sense of loyalty to one or two companies, and places business with them. The newer, younger advisers are driven by a variety of dynamic and more individual rewards. So we need to look beyond the traditional models.”
Short-Term Sales Driver
At Manulife Financial In Waterloo, Ontario, Patricia Kerr, CMP, director, distribution sales support, has been pushed by the business environment and the economy to look outside the traditional incentive conference box to drive sales.
“In 2008 and 2009, companies got kicked when they were down. Slumping sales combined with aggressive expense management and negative conference perception forced all meeting managers to review strategic plans. We have to look at what else we can do, over and above the incentive conference, to help drive sales.”
To that end, several regional Manulife offices designed short-term campaigns for the fourth quarter of 2009. “We are confident we have motivated individuals,” Kerr says of the contests, which were still under way as this issue went to press. “I recently received a call from an adviser whom I never would have guessed would be motivated by this contest. This is the exact result we are looking for.” One of the contests, in fact, is seeing more than double the anticipated number of advisers on track to qualify.
At TD Ameritrade in Omaha, Neb., Ken Juel also uses individual travel rewards to keep the competitive fires burning throughout the year. “We need to show good results quarter to quarter,” says Juel, manager, sales incentives and recognition programs.
Contributing to those results are a number of short-term sales contests that “maintain the buzz and excitement” of the year-long incentive program, he says, adding that the shorter-term programs also get performance boosts out of salespeople who will likely not qualify for the annual conference.
Travel Beats Cash
What drew a lot of Jim Dittman’s banking clients into individual incentive travel in 2009 was the cancellation of group trips. Qualifiers had put in the hard work; companies had to recognize them. Some used cash. Not the best choice, says Dittman. “A few weeks after, they will have no idea what they did with the cash. A trip is a reward for a job extremely well done. And when it doesn’t happen, and you don’t remember what you did with the money, it’s as if there was no award at all.”
Using individual travel means realizing what Robert Ward, director of sales, Ovation Rewards, Fairmont/Raffles/Swissôtels, sees as four phases of motivation. First is the anticipation of earning the trip. Second is the excitement of telling friends and peers that you’ve earned it. Third is the experience itself. Fourth? The bragging rights when it’s over.
In more than three decades as an incentive travel provider, Bob Guerriero of The Journeymasters has seen companies move away from cash. “One insurer was big on big money for their top prize, awarding $5,000,” he recalls. “They generated so much excitement with our Above & Beyond program that they have never gone back to cash. It’s been six years.”
Consider the research. The Forum for People Performance Management and Measurement found that managers prefer noncash motivation solutions to achieve nine of 10 business objectives, including increasing profitability, increasing customer satisfaction, and increasing retention and loyalty.