Budgets are expanding for incentive programs, and companies are appreciating the "soft-power" objectives programs deliver -- aiming, for instance, to build engagement and retain employees -- as well as the traditional goal of meeting and exceeding sales targets. Those positive findings are among the key takeaways from the 2019 Incentive Travel Industry Index, a collaboration between Society for Incentive Travel Excellence, the Incentive Research Foundation, and Financial and Insurance Conference Professionals.
The second annual study from Oxford Economics queried 2,600 incentive travel professionals from 100 countries. The following are highlights from this leading industry indicator. All charts sourced from Incentive Travel Industry Index.
Leading ways incentive programs benefit companies
|Increased sales and/or profits for the company||80%|
|Improved engagement by employees or channel partners ||74%|
|Increased individual productivity ||71%|
|Better relationship-building between employees and management ||68%|
|Improved retention of employees or channel partners ||67%|
|Better relationship-building between employees ||64%|
|Enhanced customer satisfaction ||60% |
|Increased mindshare in competitive market ||49%|
|Enhanced ability to recruit new employees or channel partners ||39%|
|Enhanced training or knowledge ||39%|
Top factors driving site-selection decisions
|Infrastructure, such as quality hotels for handling incentive programs|| 83%|
|Overall participant safety|| 82%|
|Appeal of destination to participants|| 81%|
|Value for money|| 77%|
|Presence of a good destination management company|| 63%|
|Access from qualifiers’ home cities|| 60%|
|Executive mandate|| 43%|
|Presence of good destination marketing organization|| 31% |
|Availability of financial support|| 19%|
Out and about
Group cultural or sightseeing experiences were considered the most important program inclusion by 52 percent of those polled.
Dining experiences were a close second (50 percent), followed by team-building activities (42 percent), luxury experiences/bucket-list inclusions (35 percent) and CSR activities (33 percent).
Spend to rise
Per-person expenditures are expected to increase slightly over the next three years, according to the study. In 2019, respondents spent 1 percent more than in 2018. Planners believe year-over-year spend will continue to rise, by a projected 1.67 percent in 2020, 2.2 percent in 2021 and 2.6 percent in 2022.
Security measures to be implemented in 2020-'21
|Mobile event app to communicate risk-management issues||61%|
|Social media policy||53%|
|Compliance requirements||51% |
|Extra physical security ||47%|
|Extra IT security||44%|
|Vendor security audits||39%|
|Extra medical personnel||34%|
Budgets and spend will rise
More than half of respondents (53 percent) reported that their incentive travel budgets will increase next year.
That's a jump from 2019, when 43 percent said their budgets would grow; and from 2018, when 37 percent reported an increase
Likewise, per-person spend increased in 2019 for 42 percent of those polled. Next year, per-person spend will grow for more than 47 percent of the respondents.
What will drive higher per-person spend? Rising hotel costs were cited by 63 percent of those polled, followed by higher airfare (56 percent), food-and-beverage costs (54 percent) and overall destination expenses (44 percent).
Activities winners will want in 2020-’21
|A selection of flexible activities for individuals or small groups of qualifiers || 65%|
|Activities promoting wellness|| 64%|
|Activities in support of a CSR or other sustainability objective|| 61%|
|Learning and development options unique to the destination|| 61%|
|Team-building or networking events|| 59%|
|Inclusion of spouse/partner in the program|| 59%|
|Learning and development options relevant to sponsor company's business|| 40%|
|Activities that all participants are mandated or expected to attend|| 34%|
|Golf or other competitive individual or team sports|| 26%|
How buyers learn about incentive destinations
|Educational (fam) trip to the destination|| 82%|
|Face-to-face meetings or sales presentations in planners' workplace|| 77%|
|Face-to-face meetings or sales presentations at a trade show|| 69%|
|Face-to-face meetings or sales presentations at boutique marketplace events|| 66%|
|Pre-site video of destination's incentive offerings coupled with face-to-face meetings|| 63%|
|Video calls or webcasts|| 37%|
|Marketing and promotions from the destination|| 26%|
Average program time to be spent in meetings
|More than 6 hours a day || 5%|
|4-6 hours a day|| 14%|
|2-4 hours a day|| 29%|
|Less than 2 hours a day|| 37%|
|Don’t know|| 2%|