Group travel has been the foundation of sales incentive efforts for almost as long as there have been sales incentive efforts. And for good reason. Travel has long ranked among the most motivational, memorable and appreciated forms of recognition by program participants.
What’s more, as with any well-structured incentive campaign, the bump in incremental sales should cover the cost of the program with enough left over to provide a hefty increase to revenue for the period.
When the world went on lockdown in spring 2020 due to the global pandemic, travel rewards for internal sales incentive campaigns, channel partner programs, customer loyalty efforts and other sales and non-sales performance improvement strategies was instantly unavailable.
The Incentive Research Foundation (IRF) reported that as incentive travel programs were canceled in 2020, spending on gift cards and merchandise for incentive use increased. There was some concern that some program sponsors would not return to using travel rewards. Recently, however, a survey of incentive travel buyers, end-users and suppliers shows that while the dramatic drop in group travel will last through 2021, a rebound to 2019 levels or higher is expected within one to two years once post-COVID conditions are reached.
The Incentive Travel Industry Index, a joint survey project by the IRF, the Society for Incentive Travel Excellence (SITE), and Financial & Insurance Conference Professionals (FICP), polled 2,356 incentive travel end-users and suppliers in
September and October 2020. A total of 1,062 responded. Two- thirds (66%) said they expect incentive travel to rebound within two years after the COVID situation is stabilized; 32% said it would take three to four years to fully recover, while 2% felt recovery would require five years or more.
Permanent Program Changes
Approximately three-fourths of respondents (77%) said incentive travel programs post-pandemic will be only moderately different or no different from incentive travel in the pre-pandemic world. Of those who expect permanent shifts, one of the most commonly mentioned changes is increased use of individual incentive travel that focuses on providing award recipients a once-in-a-lifetime experience.
Trends that were emerging prior to the pandemic, such as activities promoting wellness and corporate social responsibility (CSR), are expected to continue to increase in popularity as incentive travel rebounds.
Destinations Then and Now
The pandemic doesn’t appear to have changed participants’ idea of desired destinations. In a separate poll by the IRF of more than 400 program participants (almost all were residents of the U.S.), destinations that ranked most desirable prior to 2020 remain the most attractive. In order, they are Hawaii, Caribbean (including Puerto Rico), Western U.S., Western Europe (Germany, France and Italy), Alaska and the Southern U.S.
“The biggest ‘miss’ between preference and demand seems to be Mexico,” the IRF report states. “While Mexico has limited motivational value to program earners, there is significant RFP activity [through 2023] by program owners. Mexico may be losing its motivational appeal due to factors such as overuse as an incentive award or some of the negative publicity it has received in recent years.”
Destination features that are desirable — beach/sunshine, adventure travel and mountains — reflect the COVID-impacted preferences of participants for open space, according to the IRF report.
Other Enticing Factors
The program participants who responded to the IRF poll said beyond an attractive destination, the ability to bring a spouse/ significant other or friend on the incentive trip is a critical component to making the trip desirable. Having expenses covered, going to a destination to which they have never been before, and having luxury accommodations also ranked as highly important.
The data show that over half (52%) prefer an incentive trip lasting between six to nine days, with 27% preferring a trip lasting less than six days.
For Now, Smaller Groups
The good news is that travel is still an attractive award. Program sponsors must keep their participants’ preferences in mind when creating a program and understand that what worked in the pre-pandemic world may work again, but possibly not in the immediate future.
“A major goal of many incentive travel experiences is the opportunity for top performers to network with their peers and leaders. For the time being, this may need to be tamed a bit.
Smaller trips that offer greater flexibility may replace large group experiences,” the IRF report states. Although participants still want luxury accommodations, they also want some distance from their fellow travelers in the form of private residences and bungalows within large resorts. In some cases, individual travel experiences may be more motivating than the more traditional group experience.”