Steve Altieri is a man with a definite philosophy when it comes to thanking his top achievers: One size does not fit all. As manager of compensation and benefits for the Foxboro Company, an instrumentation manufacturer for the chemical industry based in Foxboro, Mass., Altieri decided a couple of years ago that his best performers needed more than the traditional group incentive trip. "I realized we needed something different to keep people on their toes."
Since Foxboro already conducted several top regional and national sales meetings every year, the company's highest achievers already had opportunities to rub shoulders with their peers, as well as with senior management. So Altieri took the direction more and more companies are taking and began to offer individual trips as rewards. "It was time to build travel incentives to be outside of those annual events--to let the salespeople go their own ways with their spouses."
Altieri uses several types of individual incentives. One program, the Circle of Excellence, is targeted to the company's "creme de la creme"--the top 10 percent of the sales force, along with some sales managers. He also runs contests to increase the visibility of new or targeted products and to generate orders. "We'll do a drawing, with first-, second-, and third-place winners," he explains. "Every time an order comes in, the salesperson's name goes into a hat. Obviously, the more orders you get, the more times your name goes into the hat, and the greater your chances of winning the trip."
What Do Employees Want? In a 1999 survey sponsored by the SITE Foundation and other members of the umbrella organization, the Incentive Federation, 36 percent of the corporations responding awarded domestic trips to individuals--almost as many as used group trips (39 percent). When it came to incentive awards for international tours, 18 percent of the responding companies gave individual awards, and a close 21 percent went for group trips.
Why individual incentives, and why now? "Look at what's happening in the workplace," says David Riddell, vice president of certificate marketing for Marriott International in Bethesda, Md. "Many baby boomers have put their families on hold while they chased their careers. Now that they're getting on in years, they want to spend time with their families, and individual travel gives them the opportunity to do that.
"Also, with individual incentives," he adds, "the company is saying, 'It's what you want that matters--rather than what we think is best for you. That's a reaction not just to the baby boomers but also to the Generation Xers, who are pretty individualistic. They like to do things on their own; they don't like the herd mentality."
Another factor playing into the growing use of these awards: With unemployment down and increasing competition for skilled candidates, companies need new retention tools. "The come-on is, 'Take the job and stay with me for six months. Then you can go where you want, take whomever you want, travel when you want, and you make all the decisions,'" says Riddell.
Finally, he says, the trips cost less than group incentives. "On average, a company will spend somewhere around $1,000 to $1,200 dollars for an individual incentive trip--half the cost of a group trip."
Easy to Use It's all about choice, according to Scott Skeabeck, manager of sales promotion and advertising at ING Equitable Life Insurance in Des Moines, Iowa. "People just don't seem to want to be locked into anything now. That's what's nice about the travel packages that offer winners a choice of 500 places to go."
Skeabeck recently held a contest in which he gave out $100 gift certificates toward trips through his local travel agency, with a 5 percent discount on the travel. "The more insurance applications (APs) people did, the more travel they won," he explains. "One guy did 10 APs, and won $1,000 toward a gift certificate, which he could apply to any trip he chose."
In another contest, Skeabeck offered a choice: For every AP, the salesperson would win $100 toward a certificate from Hertz, Avis, American Airlines, or United Airlines. "Each person had an individual package of certificates and created his own trip, which was nice because we weren't involved in administering the actual travel," he says.
Skeabeck figures his return on investment several ways: "We look at how much business came in, which in our case, is premium," he explains. "We find out how much the award cost, and we know that, for every award dollar, we got X amount of premium in the door. Sometimes we analyze it just based on volume. If we're trying to get new agents in, premium isn't as important as getting people in the door selling their first AP."
Since they're flexible and easy to put in place, these types of awards have allowed the company to be more responsive to market pressures. "Let's say sales are down this month on annuities," says Skeabeck. "Right away, we'll start working on an individual incentive promotion to get out there in the next few days. You can't do that with group programs. While other companies might not have a campaign planned until fall, we'll immediately react to the marketplace and to our field force."
The trips themselves are typically extended weekends. "It's not like it was in the 1950s and '60s, when American families took weeklong vacations," says Skeabeck. "What it gives me a chance to do is offer plenty of options--so someone can go skiing in Killington, Vt., while someone else can take the family to Orlando."
Just as at Equitable, the types of individual incentives used at Gillette, in Boston, Mass., vary widely. "We've done some weekend getaways based on where the person wanted to go, with them paying for all the incidentals," says Sharon Banaszak, an account manager. "Sometimes we'll create an entire travel package with golf and dinner for two; other times we'll pay only pay for the accommodations, or hotel and transportation."
She typically awards first-, second-, and third-place prizes. "First place may have accommodations and a little more thrown in, while second or third might get downscaled by maybe $100. It's all based on what the sales goals are. We have to do about a 10 percent investment based on our total return from the program."
Not Just for Sales In addition to being an award that offers flexibility to dual-income families and one that is easily administered for short-term promotions, individual incentives are a natural fit for nonsales employees. Paul Mednis, national marketing development manager at the Journeymasters, an incentive travel company in Salem, Mass., gives an example of a program he's working on for one company's human resources department. "The client reviews its employees every two months for exceptional service. It could be a secretary, someone in customer service, or accounting--even maintenance. A committee will get together, suggestions will be made, names will be evaluated, and then the chosen people will get the award."
The company uses a combination of Journeymasters' "Sapphire" and "Ruby" Awards. The Ruby Award is two airline tickets to anywhere in the continental U.S., plus three days, two nights at one of more than 600 hotels. The Sapphire Award is four days, three nights and $350 in hotel credits, or two roundtrip airline tickets to anywhere in the U.S.
Again, this doesn't work for every company. At Foxboro, for example, Altieri has included some support people in his programs "when it made sense," but "that's more the exception than the rule."
Another point is that there's only so much time people can take off from their jobs for any type of trip, which discourages employees from entering multiple contests within a single year. Says Equitable's Skeabeck: "You've got to stay at work, too. So travel--any travel--can be a little tricky that way: It's best if it's a rare commodity."
Little Work, Big Payoff As the person in charge of all of NBC's national radio promotions, Merry Aronson is a true believer in individual incentives. "I've been using them for about four years, and I do about 10 national promotions a year in about 125 markets each," says Aronson, director of special projects in affiliate advertising and promotion services for the network, based in Burbank, Calif. "In the top 25 markets, the grand prize often involves a glamorous trip, with hotel, airline, and spending money."
As she puts it, the awards are carefree: "I don't have to become a travel agent and book people's trips. The awards go into the envelopes, and it's the last time I deal with them."
NBC ties the trips into individual promotions. For example, the promotion for the comedy show Friends gave winners a trip to see a friend anywhere in America. "Our goal is to promote our television events to radio listeners and drive them to watch our broadcast events," she says. "All of my grand prize trips are given away on what we call a 'Watch, listen, and win' basis: You can only answer the question that will win you the trip if you've watched the series or the movie."
The on-air quiz building up to that grand prize question takes many different forms. It could be sound bites from the celebrities on the shows, or a trivia quiz that the DJ announces, or sound bites from the shows themselves. Aronson writes the promotions herself. "Sometimes I get the celebrities to record all the sound bites I write. Often they'll do the radio promos as well: 'Hi, this is Jennifer Anniston from Friends. Make sure you stay tuned to this radio station for a chance to win a trip to England, and I'll see you on Thursdays.' We've done it all kinds of ways."
More often than not, the grand prize is a glamorous trip--because, she says, "That's what listeners want the most. And it's working very well for us: We get about a five- or six-to-one return on investment. If I measured the air time we get on radio, if I measured what it cost us to buy, I get about $300,000 of free air time in the top 25 markets per contest."