Annual group incentive travel programs for top sales performers have been a staple for driving performance for decades. They are not going away, as evidenced by the most recent research from the Incentive Federation, which shows that companies budgeted $14.4 billion in 2015 for incentive travel programs.
There will always be companies that find value in bringing top performers together to celebrate their successes. But the incentive industry research and anecdotal evidence indicates significant shifts in incentive travel spending are also occurring. The increasing popularity of individual incentive travel should not be ignored.
What it looks like
Individual incentive travel rewards come in many different varieties. It may be provided in the form of a gift card or an option in a points program that also includes incentive merchandise. Typically, reward recipients can travel when they choose and often select the destination. Some individual incentive travel instruments do select the destination for the recipient, while others provide a value amount that can be spent on the trip of the recipient’s choice.
“It has always been a viable option,” says Melissa Van Dyke, president of the Incentive Research Foundation, a nonprofit that funds research studies and develops products serving all segments of the global incentive industry. “When an economic downturn hit, it became an interesting option for companies that did not have the dollars to spend to get their whole group together.”
Why it’s used
Van Dyke says conversations she has had with users of incentive travel indicate companies use the strategy to offer variety and maintain a reasonable price point. In a hybrid model she has seen used, program sponsors offer individual travel to one of three or four preselected destinations. As Van Dyke explains it, this allows companies to get volume discounts from the preselected hospitality providers and gives recipients at a company a common experience to talk about once their trip is completed.
“There are more organizations trying to figure out how they motivate four or five different generations in the work force,” Van Dyke explains. “A millennial who is just out of college and in their first job has a very different travel interest than someone who is married and has two or three children. Individual incentive travel tools are becoming more accessible and customizable, providing something that is motivational to both of these employee groups.”
Small firms generally report a higher reliance on individual travel, while larger firms split rewards more equally across individual and group travel. This is particularly evident in channel programs. Additionally, sales and employee programs tend to outpace channel and customer programs in their use of individual travel regardless of company size.
