Corporate Incentive Trends 2004
(Corporate Meetings & Incentives)—The profile of the typical incentive program goes something like this: A 12-month campaign, designed to increase sales across the board, has as its reward a group travel program to a domestic destination, probably Florida, Hawaii, or California. The CEO selected the destination, and an in-house team handled the logistics. Just over 200 employees qualified for the trip, and per-qualifier spending topped $2,650.
That’s a quick snapshot of some of the aggregate results of our 2004 Corporate Incentive Trends survey; the complete story is, of course, far more nuanced. We’ve learned that a third of respondents are designing incentives to deal with targeted goals such as growing product awareness or increasing sales of a particular product; that only one in four respondents is using outsource partners such as incentive houses and independent planners to help with incentive travel logistics; that a full 50% of respondents’ current or upcoming major incentives are planned for international destinations or a cruise ship; and that 75% of site-selection decisions for incentive travel are made by either C-level executives or sales and marketing management.
Overall, incentives—and especially incentive travel rewards—appear to be trending in a positive direction. Almost two-thirds of respondents reward their salespeople and distributors with travel—either individual or group. And per-person spending for these programs shows steady growth. When budgets do shrink, respondents say that cutting the number of qualifiers is their least likely response.
Most respondents (81%) geared their incentive programs to salespeople, and about a third (35%) ran dealer/distributor programs, but other workers were not forgotten. Half the people who answered our survey had incentive programs in place for their nonsales employees.
Not everyone is rewarded equally, however. Salespeople and distributors are more likely to have travel incentives dangled as their reward than nonsales employees. Although group travel is the No. 1 reward for all three groups, nonsales workers are almost as likely to be offered merchandise and cash for good performance.
Interestingly, while merchandise is the reward for one in four distributors, incentive organizers don’t have much faith in its ability to motivate increased sales.
Increasing overall sales far and away is the reason for launching an incentive program in the eyes of most readers. It is interesting to note, however, that about a quarter have a more niched goal for their programs. Respondents wrote in a variety of “other” primary goals for their incentive programs, most of which fell into two categories: “reward high achievers” or “education.”
To get at respondents’ incentive destination choices, we asked them where they had taken their last major group incentive program and, if they knew, where the next two were booked. We analyzed the resulting pool of 214 trips. More than 80 individual destinations got a mention, from Napa, CA, to Naples, FL, to Hilo, HI, on the home front and a broad range of international sites: Barcelona, Hong Kong, Nevis, Nassau, Rome, and many more. While the quality of the resort and many other factors play a role in site selection, clearly warm weather is critical to most destination decision-makers. Canada, which had made a good showing in past surveys, fell off the list of top sites. Respondents are reporting growing enthusiasm for Mexico incentives, strongly booking the Cancun and Los Cabos areas in particular.
Methodology
In early November 2004, Primedia Business Marketing Research (a unit of CMI’s parent company, Primedia Business Media) e-mailed invitations to participate in an online survey to a selection of CMI’s corporate subscribers who have responsibility for incentive travel programs. A follow-up e-mail was sent a week later. The results here are based on 148 useable responses.
