Every year the Incentive Research Foundation puts out their highly-anticipated incentive trends study, drawing from comprehensive data on client experience and industry research. The IRF’s trends study is a benchmark of the incentive industry and helps to guide incentive strategies and marketing plans. Is your incentive system taking advantage of the IRF’s findings and capitalizing on this year’s incentive trends? Let’s find out!
Non-Cash Incentive Rewards
The numbers don’t lie: non-cash incentives are continuing their steady rise in popularity over cash alone. In 1996, only 26% of US businesses were using non-cash rewards in their incentive programs. But in just the last 20 years, that number has leaped up to 84%! The IRF attributes this to the fact that as companies become more service-focused and employees are increasingly expected to take on non-core job roles, non-cash incentive rewards continue to provide employers with a way of recognizing and promoting positive behaviors. Additionally, there’s plenty of research to suggest that recipients of non-cash rewards enjoy their rewards more and are more likely to tell their friends about them than cash alone—providing trophy value as well as improving your brand image!
In addition to the continued growth of non-cash incentives, the IRF also noted that incentive travel is on the rise, with nearly 40% of US businesses using travel programs as a way of incentivizing and rewarding employees and channel partners. Budgets for travel programs have also seen significant growth, with one-third of program planners now working with a per-head average of $3,000-$4,000. In addition to big-budget group travel programs, the incentive trends study also reported that 25% of program runners are increasing their offerings of individual travel options.
Personalized Incentives and the “Experience Economy”
Although the “experience economy” isn’t new (the term was coined in an article from 1998 it’s only recently begun to take hold in the incentives business as an industry standard. Rather than spending points on tangible rewards, incentive program participants are opting instead for “experiences”—things like movie, sports, and concert tickets are all seeing a significant boost in redemption rates. As more and more incentive systems are expanding their rewards catalogs to include these kinds of personalized incentive rewards, the variety is growing to include full-on retreats like spa days, cruises, and festival passes. The trends study found that 42% of program runners are increasing their offerings of these “experiential rewards”.
The IRF makes a point of noting that these personalized incentives are more than just alternatives to merchandise rewards—their real value lies in tapping into a participant’s emotional engagement to motivate them and promote positive behaviors. As the study states, “the focus for travel is now not only on the destination and venue but equally important are the authentic, unique, individualized experiences delivered.”
New Incentive Technology
The biggest takeaway from the 2017 incentive trends study is that the growing use of technology in our daily lives is having a huge impact on the way we need to think about our incentive systems. The IRF determined that nearly 90% of large businesses are using technology to implement their reward programs, with 60% of those responders engaging with their participants through mobile app technology. Social media continues to see a steady rise in marketing campaign strategies, with over 60% of survey respondents reporting that they rely on social media platforms to boost communications for their programs. The study also brought attention to the role and potential of wearable technology (such as Apple watches and fitness trackers), not only as incentive rewards by themselves but also as a new way of communicating and engaging with program participants.
If your incentive system isn’t utilizing these findings, it may be time to rethink your strategy!
If you haven’t already, you can check out the whole study over at the IRF’s website.