An August 2012 focus group of gift card providers, incentive firms, and corporate end-users held by Corporate Meetings & Incentives and the Incentive Research Foundation explored what’s new in this niche. Here are some of the top findings:

Ease of use is a priority—Checks take a week or more to arrive and cost money to ship. Cards offer quickness of awards and ease of use, which makes them more attractive to administrators.

Internationally, however, merchandise is a coveted award in many places—For example, it’s the best fit in countries with a “gift-giving” culture. Also, in places like Latin America and Asia/Pacific, where there are infrastructure issues and most people don’t have cars, winners prefer items to be delivered to them. In these locales, it’s not necessarily a perk to go to department stores. As one incentive winner said,  “Instead of just going into a store, can’t I just get a tea kettle?”

Companies are getting smart about making the connection between the redemption of the card and the sponsor—Two ways to do this are by customizing the cards or by creating communications that reinforce with recipients why and from whom they received the award. Cards are different from incentive travel, where the sponsoring company is present, or from merchandise awards, which are chosen right from the company’s portal.

The use of cards has grown in the recession—During tough times, people look at all of their compensation mix as “available dollars” and use cards for something they need, like a home improvement item, or a kitchen appliance, or a new couch. In the participant’s mind, gift cards have value, and can be combined with other points they might have, or a sale the store is holding, to get a good deal.

Cards are being used as supplemental awards—One example would be a card to a restaurant that can be used while the winner is on vacation, or one that takes the burden off of the winner for paying for everything on a long weekend trip.

Trophy value is key in a recession—People have less money to spend on themselves. Items that might not have been trophies before have become so now.  Gift cards allow winners to have “little splurges” they can no longer afford.

Gift cards are most effective when used as part of a mix of awards—It’s important that the program not be a one-off, but rather that it be aspirational. You want participants to goal-set so they can achieve more and more points.  

Wellness programs are not stand-alone, but are often a piece of a larger employee program—Also, rewards for wellness incentives don’t have to be wellness-related. In fact, many companies choose a card that allows the winners to indulge after being so good!

 

Attendees

Kathleen Bibbins, vice president, merchant partnerships, Intellispend, Fenton, Mo.

Thomasine Joyce, senior project manager, sales operation, Anheuser Busch, St. Louis

Mary Luckey, director, Maritz, St. Louis

Mike Ryan, senior vice president, marketing and client strategy, Madison Performance Group, New York