Companies expect to expand their use of merchandise and gift cards
to reward, motivate and recognize employees and clients in 2021, according to
an Incentive Research Foundation study. The report, titled Industry Outlook for 2021: Merchandise and
Gift Cards, queried 322 industry professionals including corporate
buyers, direct suppliers of gift cards and merchandise, and third parties
(incentive companies and consultants).
"The good news is that the value of incentives has been established within
organizations leading to budgets holding steady in many cases," said IRF
president Stephanie Harris. "Incentive programs looked very different in 2020,
with many organizations using merchandise or gift cards to keep teams motivated
while incentive travel is on hold. As we look toward 2021, the effectiveness of
merchandise and gift cards as motivators will continue to be a key to the
growth and success of many incentive programs."
Key findings of the merchandise and gift card research includes:
- Gift card use increased during the pandemic. More than a third (35
percent) of those polled spent more on gift cards in the past year.
Total corporate gift and merchandise spend held steady during the
pandemic. A third of respondents increased their merchandise spend, 31 percent
spent less, and the balance spent about the same.
More than a quarter (27 percent) of incentive travel programs
shifted money away from trips to gift cards and merchandise during the
The business outlook for 2021 is cautiously optimistic: Industry
stakeholders have positive expectations for 2021, with 64 percent of those
polled expecting their companies to have strong financial performance.
Budgets will increase slightly in 2021: Program budgets are
expected to increase by a modest 7 percent. Technology will take up the largest
(26 percent) portion of the budget, followed by 16 percent allotted to both
gift cards and program communications, respectively.