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.” It's about choice — and we've got some choices for you on the following pages.
A Choice For: Short-Term Sales Drives
Patricia Kerr, CMP, Manulife Financial, Waterloo, Ontario
The business environment and the economy are pushing us to look outside the traditional incentive conference box to drive sales,” says Patricia Kerr, CMP, director, distribution sales support, at Manulife Financial in Waterloo, Ontario.
“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.
A Choice For: Skittish CEOs
CEOs are faced with revenue shortfalls and an uncertain future. If you can present a cost-effective and risk-free program that also boosts revenue, you might just end up as employee of the year 2010.
Consider individual incentives. “Our Great Escapes program has no minimum commitments and no upfront costs,” says Jim Dittman, president of Dittman Incentive Marketing, who launched his company in the 1970s. “The costs come only if the results are achieved.”
Individual rewards also can complement group trips. Faced with budget cuts, a client of Robert Ward, director of sales for Ovation Rewards at Fairmont/Raffles/Swissôtels in Chicago, reworked a 1,000-person group program into two parts: a conference for the 500 top earners, and individual travel for the second tier. “Individual travel is very economical, and it's easy to measure the,” says Ward.
It's also flexible. “The lightning pace of the competitive landscape today calls for people to react in rapid and tactical ways,” Dittman says. “There will be an increasing need to create incentive programs on the spot that have motivational power. Travel will always do that, and a program can be built and launched in a matter of hours.”
Your Best Choice: Travel Beats Cash
What pushed 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, president, Dittman Incentive Marketing. “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.
A Choice To: Complement the Group Program
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 Jim Dittman, president, Dittman Incentive Marketing. “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.
With that in mind, Dittman emphasizes a high-level approach in both areas. “Just throwing someone a couple of travel certificates falls well short of the treatment an incentive winner has the right to expect,” he says. “You need a personal and professional travel counselor and world-class pre-trip winners' materials to deliver the trips in a white-glove way.”
A Choice For: Younger Agents
Ken Juel, TD Ameritrade, Omaha, Neb.
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.”
Individual Incentive Travel Menu
Dittman Incentive Marketing ◆ www.dittmanincentives.com
Journeymasters ◆ www.journeymasters.com
American Express Incentive Services ◆ www.aeis.com
Fairmont/Raffles/Swissôtels ◆ www.frhi.com/ovationrewards
Marriott International ◆ www.marriott.com/incentives
Hyatt Hotels & Resorts ◆ www.hyattincentiverewards.com