Increasing regulation, rising business optimism, and a growing appetite for wellness: These are just a few of the things that promise to shape incentive travel, reward, and recognition programs in 2018, according to the Incentive Research Foundation (IRF), which today published its annual study highlighting the top incentive trends that will affect organizations in the year ahead.
"The IRF 2018 Trends Study" identified 10 trends that will impact incentive programs in 2018.
1. Brand-Asset Culture
Building a brand-asset culture -- a culture wherein a company derives as much value from its intangibles as it does from its traditional assets -- will become a business imperative in 2018. Non-cash awards are expected to grow as the focus on brand, culture, and innovation becomes even more critical to business success.
2. Market Optimism
The incentive travel industry's net optimism score for the economy is up almost 20 points from 2017, according to the IRF. Increased optimism is leading to budget increases for incentive professionals: The average annual per-person spend in 2017 -- $3,915 -- is a 4 percent increase over the previous year.
Over 70 percent of respondents to the IRF's "Regulations Study" said they had made changes to their programs' design, communications, rewards, and/or reporting in response to regulations.
4. Rising Costs
Although incentive travel budgets continue to rise, 60 percent of incentive professionals say costs are rising faster than budgets.
5. Risk Management
From PCI compliance to concerns over the European Union's General Data Protection Regulation (GDPR), ensuring program participant data is secure and used appropriately is a "central concern" for all types of non-cash award programs.
6. Predictive Technology
The IRF says predictive analytics, artificial intelligence, and augmented reality capabilities will be a "fundamental requirement" for vendors and suppliers looking to partner with incentive professionals in 2018.
More incentive professionals are adding health and wellness components -- focused on fitness, food, and comfort -- to their incentive programs this year than any other feature, the IRF reports.
8. Unique Destinations
Incentive planners are interested in new and different sub-destinations, according to the IRF. In Italy, for example, planners are looking at lesser-known destinations like Puglia instead of mainstream favorites like Rome.
9. Meaningful Merchandise Awards
When it comes to merchandise awards, incentive participants in 2018 don't necessarily want more choice; rather, they want more meaning, according to the IRF, which says "impactful products" -- for example, products with local sourcing or organic roots, as well as products that can be easily personalized and customized -- will reign supreme this year.
10. Gift Cards
Finally, gift cards will gain momentum in 2018, according to the IRF, which says mid-size firms spend an average of nearly $500,000 annually on gift cards across all programs, while large ones spend over $1 million annually.
"'The IRF 2018 Trends Study' clearly demonstrates that professionals in the non-cash rewards industry continue to experience a tremendous amount of change," said IRF President Melissa Van Dyke. "From culture shifts to technological advances to regulatory pressure, the IRF is tracking some essential shifts in the industry and discussing how to anticipate and respond to these trends."