Indexes, surveys, and studies are tools forecasters use to keep tabs on business and industry trends, and for 2011, the Incentive Research Foundation and Corporate Meetings & Incentives conducted a joint survey to see what’s on the horizon for this new year.
The survey sought to find answers to questions, such as:
- Would companies be able to keep upscale incentive programs during 2011?
- Are employees adapting to the ‘fewer frills’ incentives?
- Do recipients of rewards notice that the fanfare is gone?
- Can companies provide quality rewards trips on tight budgets?
Along with the Incentive Research Foundation study, The SITE Foundation recently updated and published the outcome of its ongoing Index study – “The Annual Analysis and Forecast for the Motivational Events Industry.”
Expectedly, the results of both studies are similar. And, as usual, the economic environment took center stage as a principle source driving trends.
Reduced and tighter incentive programs took top focus, caused by budget reductions. While there seems to be an overall slight improvement in budgets for 2011, almost 25 percent of respondents cancelled 2011 travel incentives – that is the same figure as 2010. Along with this, “9 percent reported canceling a 2011 merchandise incentive (up from 4 percent last year).”
Despite a somewhat sunny forecast, 22 percent of respondents anticipate 2011 to have lower budgets than 2010. A bit more drastic, 10 percent believe their budgets will be “significantly lower.” One-third is a pretty high percentage.
The new business trends seem to raise even more questions about incentive programs:
- Will the incentive budgets ever be restored to their former glory?
- Will employees care?
- Will employers find effective strategies to compensate for a lower budget?
Some companies have already found an answer to the last question:
- The number one strategy is to reduce the number of gifts rather than compromise on the event or reward quality
- The second strategy is to shorten program duration
- Third on the list is to cut down on the number of recipients
These are just three of many other steps business owners can take to create and maintain successful incentive programs on a lower budget.
Another interesting trend is an increase in ‘green’ and corporate social responsibility that is making its way into incentive programs. This strategy may very well help ease employee resistance to reduced travel incentives, and other extravagant rewards.