<B> Merchandise Adds To Travel Incentives</B>
By Dr. Lauri John Hakanen
<i>Dr. Lauri John Hakanen, a 20-year veteran of the performance improvement industry, is an associate at Incentives Inc. of Geneva, Ill.</i>
Travel is an excellent motivator. Be it group or individual, a properly structured travel incentive program will be well received and successful for all parties concerned. A recent
study by the SITE Foundation substantiated that travel programs contribute to sales increases. It also showed that higher level management prefers group travel to individual awards.
The study also pointed out that while incentive travel was highly motivational to participants who had the best chance of reaching their goal, it also provided little or no incentive to a large majority of participants who had a slim chance to hit their objective and win.
Here enters merchandise. Keep travel as a "Best of the Best" and use merchandise as a means of motivating those who are up and coming.
Like travel, the use of merchandise has evolved as an incentive award that bears little resemblance to the catalogs, prize points and/or pre-selected tiers of merchandise offerings of yesterday.
Programs tied into catalogs (or pre-selected plateaus of awards) suffer from selection limitations, lack of flexibility and perceived value problems. The merchandise "mark" is loaded on behalf of the selected incentive supplier and passed through to the sponsoring company's participants when they get ready to redeem it. We've all heard the story: "You can't earn half of a bicycle in those programs." But nobody wants to have to earn two (at retail price) to get one (in the program) either.
Some companies today have tried to ease the value and selection problems of incentive programs through the use of a debit card. While the debit card addresses the choice and solutions issue, it really has just passed the "mark" from the award-redeeming participants to the sponsoring company. The fees associated with the use of debit cards are increasing; costs such as promotion, administration (tracking) and general service fees are billable items to the user company; and any deals struck to reduce these fixed costs simply mean the sales rep has increased his/her cost of doing business.
So where is travel today in its relationship to merchandise as an award? The merchandise winners perceive a fair chance to earn and their ongoing incremental volume helps the sponsoring company pay for the total program.
The bottom line for any present or future user of merchandise awards for whatever purpose--be it travel companion, sales, recognition or services--is to ask yourself these questions:<ul>
<li>Have I maximized my dollar for dollar buying power for my merchandise awards?
<li>Who controls changes in award values, the supplier or me?
<li>Have my participants chosen the award they want? (Cash versus merchandise offers a very interesting result).</ul>
Yes, in the current strong economy, more and more companies are expanding existing budgets for incentive programs or contemplating starting one. Merchandise fits very systematically into any such planned activity, and I'd highly recommend a look at merchandise awards as a means to broaden participation and to cost-effectively impact the success of obtaining the program's objectives.
Travel and merchandise working in tandem are a double-edged sword to help your company cut to the chase--and hits its objectives.