. How the Incentive Industry Is Planning to Make a Comeback | Northstar Meetings Group

How the Incentive Industry Is Planning to Make a Comeback

IRF President Stephanie Harris discusses the industry's challenges and how it's adapting.

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Stephanie Harris, Incentive Research Foundation president

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We all thought we'd be starting to move on by now, back in our offices, dispensing motivation rewards and beginning to set up trips to all sorts of fun places. Instead, everyone in the industry is trying to determine what’s next and how to get there. 

Throughout the pandemic, the Incentive Research Foundation has been a leading resource for the industry, providing monthly surveys and webcasts, and joining in many digital events, such as Northstar Meetings Group’s Incentive Live in July. In an interview during that online gathering, IRF president Stephanie Harris shared the findings of the organization’s July pulse survey — an update to their April survey — as well as her vision for moving forward. Following are highlights of that session, including Harris’ views on the current state of motivation and travel, and her predictions for their future.

What was the most surprising finding in your latest  study?

What we found is not completely unexpected. In the April study we saw that about 25 percent of the incentive programs planned for 2020 had been cancelled. With the July study, we found that that number is now up to just over 42 percent. We are seeing more postponements now, and many of those trips are getting pushed into early 2021. Many are going into Q3 and Q4 of 2021, as well. And a lot of those cases are just outright cancellations, rather than postponed.

Was there any positive news on the travel front?

Yes, the study revealed that for programs that have been postponed, nearly 80 percent are holding onto their budgets. And that was a 9 percent increase in people holding onto their budgets from what we saw in the April study. 

When we do see budgets being scaled back, incentive professionals are often cutting back on off-site events, reducing the number of program nights and looking at eliminating guests from programs. So they’re finding good, creative ways to move forward, while working inside some budget constraints. 

What concerns are you hearing from incentive planners now and what do you think will make winners want to travel again?

The biggest concerns I’m hearing now are about working inside the current restrictions to deliver the same or a similar kind of feeling or experience [that winners expect from past programs]. Planners are remaining very, very focused on the individual, on making that winner feel rewarded and on delivering a really great experience that feels motivational, that makes people want to come back and work hard again and win again.

Are you seeing companies offer alternative awards to travel?

We are, and we are seeing a mix in the types of rewards offered. In June, we researched the topic and saw that gift cards were really leading the way: 26 percent of respondents noted they added gift cards as an option or increased the use of gift cards as a result of Covid-19. Merchandise and points-based rewards [where winners can select a reward based on points earned during a program] are also seeing increased use. We’re also hearing that some programs will automatically include winners whose trips were cancelled this year in the next trip, leading to larger groups. In cases where the participants qualify for both 2020 and 2021 programs, incentive professionals are planning to do something a little special for them on the next program, e.g., extending their trips by a couple of days, or upgrading their accommodations.

Harris predicts more gift cards will be used to award employees with individual travel options.
Harris predicts more gift cards will be used to award employees with individual travel options.

Is program design being affected by the pandemic?

We believe that the rule structure is a really, really critical piece of how companies are going to fuel an increased and faster recovery. This is the time to “move the middle” by creating rules that are structured around motivating every single person in the organization to do more and to earn more. 

How is working from home affecting programs?

There are multiple factors where it’s a challenge for managers who aren’t used to handling people who work from home. How do you know people are getting their work done? How do you interact with people? How do you recognize when someone has gone above and beyond? That’s a skill that takes some time to really develop, and people have been forced to do that in a very compressed time frame. I do see working from home as being much more of something that’s here to stay. So, what does that mean for incentive professionals? I think it’s about training and retraining people on how to recognize and reward those behaviors and how to celebrate differently. You can’t have everybody gather around those monthly bagels or that cake to recognize people. You have to find other ways to do that in the virtual scenario. 

Which destinations do you think will be most popular in the near future?

When I look at the tea leaves, I’m seeing more domestic, closer-to-home destinations. We actually did a disruption study earlier this year. People might be comfortable starting out with destinations that maybe they could drive to; or staying in smaller, boutique properties; or holding a lot of outdoor functions. Planners are going to be challenged to deliver surprise and delight in what might be a familiar setting for participants. 

What are your predictions for gifts and gift cards?

I think gift-card use will continue to be up, often in the form of travel-related gift cards. Points programs that deliver merchandise ultimately will continue to be popular, but they do have some challenges [e.g., tariffs, difficulties with getting some imports and exports, and delivery issues]. Planners really need to look at what the mix of awards are and what merchandise they can be sure to deliver. I also see those gift cards and those points and merchandise programs getting to where people feel special and rewarded. When people win trips, everybody knows who’s going on the incentive trip: They’re gone from the office and we all know they’re out there having a great time and getting rewarded. With gifts and gift cards, the bragging rights are missing. We need to figure out how to “wrap” [present] the gift card, “wrap” merchandise, “wrap” points, and deliver them in ways that make sure that same kind of recognition is happening across the organization.