In this year like no other, incentive travel across the globe took a mighty hit. But the outlook for its return is mostly positive, according to the newly released Incentive Travel Industry Index.
The third annual study is a collaboration between the Financial & Insurance Conference Professionals, the Incentive Research Foundation and the Society for Incentive Travel Excellence Foundation. More than 2,800 incentive professionals, representing 19 vertical industry segments, 41 source markets and 91 destinations, participated in the online survey that was conducted this past fall. Following are six key takeaways from the expansive study.
- Incentive travel will recover (relatively) quickly.
Two-thirds of incentive travel buyers and suppliers expect the sector to recover within one to two years, once post-Covid conditions (widely available vaccines or disease containment; the study was conducted before vaccines were approved and distribution began) have been reached. Optimism for the recovery timeline varied region — North Americans were the most positive, with 74 percent of those polled expecting incentive travel to recover by 2022; Western Europeans were more conservative, as only 54 percent expected recovery in that time frame.
- Pent-up demand will spur recovery.
The desire to travel is the greatest factor expected to influence the recovery of the industry, with 64 percent of respondents citing greater appreciation for travel after being unable to do so during the pandemic.
- Health and safety will remain a top priority.
Even after incentive travel recovers, sanitation and health security will be a permanent part of risk-management strategies for many companies, most notably for financial and insurance firms. “Given the more conservative nature of our sector, it is not surprising to see a significant shift toward participant safety,” said Steve Bova, CAE, FICP’s executive director.
- Groups will keep close to home.
“The survey confirms what we’ve been hearing anecdotally for some time: In the short- to mid-term, domestic and close-by destinations will replace transcontinental and international incentive destinations,” said Padraic Gilligan, SITE’s chief marketing officer. The index findings also reveal a shift away from trendy urban locations, while quiet countryside retreats and under-the-radar destinations are growing in popularity. “Safe” destinations are in demand, as well. Not surprisingly, added Gilligan, “destinations with a low incidence of Covid-19, or those perceived to have dealt effectively with it, rank very high — even if they’re long-haul spots.”
- Programs will focus more on “soft-power” outcomes.
Incentive travel buyers anticipate “soft-power” benefits — improved engagement, enhanced customer satisfaction and better relationship-building both between employees and management, and among fellow employees — to be among the greatest goals of incentive travel. This marks a shift from 2019, when company sales and profits were top-ranked benefits. A renewed focus on experiences that will delight the individual traveler, with fewer corporate obligations, such as group dining and team building, will be seen in post-COVID incentive program activities.
- Companies remain committed to travel rewards.
Eighty-three percent of senior-management stakeholders who sponsor incentive travel remain committed to holding such programs, although many expect incentive travel will need to fundamentally change to reduce risks. Some firms have already been moving forward with programs, experimenting with new features and learning how to deliver luxury experiences that follow safety protocols.
“While our industry has witnessed widespread impact due to the pandemic, those professionals have responded not only with structural changes to incentives such as program delays and implementing alternative rewards, but also new investment,” said IRF president Stephanie Harris. “The industry has built important capabilities to position it for future success, such as improved digital marketing and a renewed focus on the motivational power of travel rewards. This shows the continued commitment to and high perceived value of incentive travel.”