Imagine you are a partner for a company that relies on you for sales of its product. The product has increased in price six times in the last 12 months. As a result, you need to re-explain the value to the buyer, especially when competitive offers seem appealing. While your sales targets remain the same. What would persuade you to push sales of their product over another: a barely noticeable bump in your paycheck OR a personalized reward that YOU get to select? It could be that you earn enough points to get that custom-designed bicycle or even a family travel experience that’s been on your bucket list.
Many companies have recently encountered a situation very similar to this, due especially to the impact of inflation (not to mention supply chain delays). Increased prices of basic necessities and travel make more cash incentives seem like the answer. But, it’s not as straightforward as that, according to recent surveys. The latest research shows an ever-increasing demand for non-monetary incentives like points-based programs and travel.
Our clients are finding success in offering a balanced mix of rewards for their participants post-pandemic, including individual travel, the hottest brand products, and even the option to donate points to a charity, providing the ultimate reward of feel-good emotions. We have even offered a personal shopper for participants to redeem their earned points on more unique and customizable products, from a custom-built PC to a flashy fishing boat with all the extras!
Research repeatedly demonstrates that non-cash rewards are more effective at improving performance than cash. The results of a 2023 study from the Incentive Research Foundation show that non-cash incentive programs are also viewed as a valuable means to attract and retain talent and output. In the study, survey results show “half of the North American respondents believe that high inflation increases the value of non-cash incentives”, especially given the increased cost of living.
Source: Industry Outlook for 2023: Merchandise, Gift Cards and Event Gifting – Incentive Research Foundation (theirf.org)
The Greater Impact of Incentive Travel
Even with the higher demand and lower supply of travel, group incentive experiences remain effective as a top-tier reward for your high performers. Combined with points-based programs, offering incentive travel can produce a more effective focus on incremental effort and results with:
- 3x the performance lift as the same value in cash
- Stronger memorability/trophy value for earners
Unique Benefits of Incentive Travel
Incentive travel is not confused with other forms of compensation, allowing you the flexibility to turn on and off, whereas cash is perceived as an entitlement. The principles of behavioral science explain the greater ability of incentive travel to provide social reinforcement, “guilt-free spending”, high perceived value, and distinct separability from monetary compensation.