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Incentive travel

Why incentive travel is the best reward, by Rajeev Kohli

Incentive travel schemes are considered a huge success by employers, according to the respondents to a recent SITE index survey – an annual analysis of and forecast for the incentive travel industry.

Ninety-nine per cent of respondents said they believed “incentive travel programmes were ‘somewhat’ or ‘very effective’ in achieving important business objectives, with approximately eight in 10 reporting that they were a strong motivator of performance.”

Hinton says figures show that “every $1 invested in face-to-face [meetings and events] turns into $9.50 in new revenue and $2.90 in profit” – an ROI that would surely satisfy Hamso.

While the science of social behaviour, motivation theory, work ethics, psychological impact studies and ROI are at the heart of any study of modern incentive programmes, they are only a part of the story when it comes to implementation, which involves boots-on-the-ground planning.

“Destination and venue choice is dependent on the type, purpose, audience and length of the event. If the purpose of the event is to motivate, inspire and recognise participants, the event should be held away from an office environment to minimise distractions,” Hinton adds.

“For incentive travel, the destination and venue is critical. SITE research of incentive participants in the US, UK and India showed that destination ranked the highest in aspects that affect participants’ motivation. Also, changing the destination year over year had a high impact on participants’ future performance.”

Communication is vital

David Simpson, co-founder and director of learning and development with Team Building Asia, agrees it is important to hold incentive meetings away from the office, and equally vital to research what actually motivates individuals.

“It’s best to start with a comprehensive needs analysis, as motivation is subjective and what works for Mr X may not work for Ms Y,” he says. “So to take all the unknown factors out by putting the needs and expectations enquiry in to your programme planning.”

David Litteken, vice-president, Asia Pacific region, BI Worldwide, says that although most people think destination and hotels play key roles in successful incentive meetings, communication is a vital element.

“It is important to communicate with those eligible to earn throughout the entirety of the incentive programme period,” he says. “Excite them about the destination. Communicate how they are performing. Keep them engaged throughout.”

Incentive spend rises at cost of fewer participants

The latest Society for Incentive Travel Excellence (SITE) Index 2018 survey has found that per person per incentive trip budget has risen from US$3,000 to US$4,000, a reverse from the drop and stagnation in the past few years.

However, despite the plan to spend more, 80 per cent of buyers surveyed are seeking to decrease costs and reduce the number of participants.

SITE’s immediate past president, Rajeev Kohli, said the survey, conducted by J D Power in English, Spanish and Mandarin, was different compared to last year, as different segments – sellers, third-party suppliers and corporates – were given different questions to make the findings more targeted.

Although spend is rising, buyers are also looking for more value, said Kohli, adding that CSR is also making a comeback, and it is “not for millennials only”.

“Corporates and third-party suppliers are increasingly mentioning less expensive destinations and amenities to manage the cost of incentive travel programmes,” Kohli pointed out.

Among buyers, corporates are driving growth, and incentive travel is getting even stronger as a motivator for performance.

But business tends to stay within their respective regions, and 43 of the buyers surveyed said they were not planning a trip to Asia. One reason is that it does not align with business needs, while other reasons included distance and travel time.

Kohli noted the number one concern in 2016 was the cost of an airline ticket but the industry was seeing an improvement. He added that there was also more optimism about the world and national economies among buyers and sellers. But while the threat of terrorism remains a concern, it has decreased as well.

Rajeev Kohli talks about the incentive trip

Recently we write about despite many challenges incentive travel is strong. We have had an interview with an expert on this subject: Rajeev Kohli, with 22 years of industry experience, and the president of SITE and the director of Creative Travel.

Trends in incentive experiences

Today, there is a much bigger service offering that incentive suppliers are being expected to deliver beyond the acquisition of a destination travel package. Customers are looking to their suppliers to provide consultation and value-added services to design a program that is unique, custom built, demographic appropriate and deliver measurable business results. And, participants are seeking more personalized, authentic experiences indigenous to the program destination, as well as activities that allow them to give back to the communities they visit.

A multi-generational workforce is changing the design of incentive programs, particularly when it comes to the types of activities offered. While golf and spa are still popular with an older generation, younger participants are seeking more authentic and immersive experiences.

A trend in activities seem is to make them more individual and at different levels of exertion to suit the demographics. For example, water sports are now surf lessons, kayaking and paddleboard rentals.  Biking options are coastal rides on beach cruisers or a city tour on regular or tandem bikes. Golf could be group or individual lessons with a video analyzing their swing or having a pro join a foursome. Food network fans are influencing the addition of restaurant hopping, food tasting options and beer, wine, tequila and scotch tastings and how they pair with food. Spa is still popular but it requires more individual offerings of treatments, fitness/health speakers, private or small group workout lessons, etc.

Millennial’s preferences for fun personalized workouts, healthy foods and holistic wellness are fueling trends with far-reaching implications for the travel and hospitality industry. Wellness is one of the areas that planners are focusing on to ensure that we are catering to these preferences. For example, supplying bikes for delegates to use to explore the destination or providing guides for delegates to walk the route to venues that are within walking distance and just simply require an earlier meet time.

Why incentive travel works and what are the most effective motivational levers

Research by the SITE Foundation confirms that incentive travel works. Once people have earned enough money to provide for their basic needs, they are driven by a desire to raise their self-esteem—not just their earnings. Most people feel that it is unacceptable to brag about their earnings or cash bonuses to their peers, family and friends. Incentive travel does not have that same problem. Although spending your own money to take a trip to an exotic destination may be perceived as frivolous, it is perfectly acceptable to talk about a travel award and say how great it was to earn it. This is why incentive travel programs must be created to provide experiences that a typical traveler would not think to do on their own, financially afford to do on their own, or even be able to do on their own, if it wasn’t organized as a group activity.

If a program’s objective is to attract and retain employees, studies show that “qualifiers” have an increased send of loyalty to their company, a sense of belonging that makes good employees stay where they are. People will strive that much harder to earn a trip to a destination they have always dreamed of visiting. An once-in-a-lifetime, high-end travel experience creates lasting memories that will be talked about and shared by participants and motivate future performance. And, during a program the positive reinforcement given by company executives to top performers increases the ‘trophy-value’ of the travel award and its usefulness as an incentive. Each time that the participant remembers a trip, they are reminded of the recognition, which increases their commitment to the company.

Destinations: are they changing, are we going back to long haul? What are the strongly emerging destinations?

With budgets increasing and air prices stabilizing, we are beginning to see a return to long-haul destinations, particularly to emerging destinations that offer good value for the money over traditional destinations.  Of course, the choice of destinations is also being off-set by concerns for safety and security.

Today’s incentive customers are seeking new or ‘reinvented’ destinations that provide unique, authentic and memorable experiences. There are many destinations that fascinate incentive planners – countries that offer great experiences in culture, gastronomy or adventure – and emerging and non-conventional destinations may be best able to deliver something different.

To be considered “ideal” an emerging destination must be able to demonstrate that they have a solid infrastructure – sufficient airlift, four- and five-star hotels that accommodate groups; experienced ground suppliers; interesting cultural activities and off-site venues. It should also be actively investing in tourism; have a strong potential for promotion and should be economically and politically stable.

Some emerging destinations: Southeastern/Eastern Europe – Slovenia, Croatia, Poland, Czech Republic.Baltic Cruises-Southeast Asia – Vietnam, Malaysia. Latin America – Panama, Colombia. Winter Destinations – Iceland, Canadian Rockies, Colorado Rockies, Swiss/Italian Alps

Incentive Planning Is an Art

Incentive travel is, fundamentally, a trip that offers participants experiences that are once-in-a-lifetime, and/or that they could not easily afford to do on their own. Participants have earned the travel opportunity due to their performance, and therefore the experience needs to be meaningful to each individual guest. This is no easy task!

The purpose of an incentive program is different than the purpose of a meeting or other business event. A meeting is typically organized to educate, to plan, to bring people together in a working environment, so different factors are taken into account in the planning. Yes, we want to create a motivational meeting, but not in the same way as we would with an incentive program. A successful incentive travel supplier understands what it takes to craft experiences that reward people for their contributions to a company’s growth and business objectives. 

Today, there is a much bigger service offering that incentive suppliers are expected to deliver beyond the acquisition of a destination travel package. Customers are looking to their suppliers to provide consultation and value-added services to design programs that are unique, custom built, appropriate to the demographic, and deliver measurable business results.

Incentive planning is an art
Planning an incentive program is not rocket science, but it is an art and, like every art form, incentive suppliers need to have an inner passion to create. When you plan a meeting, you often don’t dwell upon the targeted results of the meeting and instead focus on successful execution. Planning an incentive program is different. You are working on generating feelings, moving a person emotionally, and motivating higher levels of performance.

Seven in 10 respondents to the 2015 SITE Index survey report they are developing newer and more creative ways to add value for their customers. This may include offering more authentic destination-related experiences; advising clients of local events they can take advantage of at no cost; sourcing unique venues for unconventional events; and incorporating ideas from other destinations/countries.
For every component of an incentive program, creativity is required to take ordinary to extraordinary. It is essential that suppliers start afresh on each project, beginning with a strong understanding of the target audience and core business objectives. You need to take into account what will be memorable to the participants and what experiences can be organized that they would not be able to do if they visited the destination on their own. Even if your program returns every year to the same destination, you need to think outside of the box and design an event that is unique and memorable, one that makes participants feel special and motivated to succeed for the coming year. 
Incentives are all about creating magical moments. With incentives, one aims not at affecting the intellect or mind, but at touching one’s hearts and emotions. 

A bright future for incentive travel

The SITE Index 2018 reports positivity and growth for the sector

The global MICE industry has been confronted with many challenges this year. From political uncertainty to natural disasters, from terrorist attacks to economic instability, much has happened in 2017 to impact business events.

The Society for Incentive Travel Excellence (SITE) Foundation recently released the SITE Index 2018. An annual analysis and forecast for the incentive travel industry, it explores the complex environment in which MICE professionals currently work and shows that, despite world events, optimism in the incentive travel sector is still high.

The comprehensive survey of 574 respondents from 74 countries, including 201 buyers, covers behaviours of both buyers and sellers of incentive travel services, revealing some positive indicators, as well as a look at future trends for the industry.

Nearly half of incentive travel buyers report an increase in their overall budget and the average spend per person has significantly increased from US$3,000 to US$4,000. This increase may be attributed to a greater number of responses from corporate buyers in the financial and professional services, science and technology, and pharmaceutical and healthcare industries, all of which are strong users of incentive travel.

TECHNOLOGY IS AN INCREASINGLY IMPORTANT PART OF THE DEPLOYMENT OF PROGRAMMES

Over half of buyers report that they are planning to increase the number of people eligible for incentive travel programmes, continuing the trend over the past two years. Buyers of incentive programmes universally believe them to be strong motivators of performance, with increased company sales and profitability remaining the most important business objective, followed by improved employee engagement.

More buyers say incentive travel programmes have been “very effective” (72
percent versus 51 percent in 2016). There is also a slight increase in the measurement of
incentive programmes, driven by one-third of corporate buyers reporting they “almost
always, or always” track return on investment or return on objectives.

Although budgets have increased, buyers are still continually looking for ways to reduce costs, with some selecting less expensive destinations and reducing amenities.

This may indicate a trend towards more elite programmes, with fewer qualifiers given even more extraordinary rewards in exchange for their exceptional performance. At the same time, sellers of incentive travel services are attempting to add value through greater creativity and innovative event design.

Air transportation still comprises nearly a quarter of budget, although technology is an increasingly important part of the deployment of programmes whether for communications, budgeting or operations . Programme apps and data tracking tools are now far more commonplace in the delivery of incentives.

The survey also found that there is more optimism about global and national

economies among buyers and sellers. Although safety remains a top concern, it has decreased since 2016 and both buyers and sellers report that it’s not a deterrent to a strong incentive market.

Despite terrorist incidents in Europe, buyers planning programmes to Western Europe increased four percentage points over 2016. Among Middle Eastern and African buyers, the most used destinations outside their region are Western Europe, Eastern Europe and Southeast Asia.

Buyers and sellers were asked to rank seven criteria for selecting one destination over another for an incentive travel programmes. Destination appeal was the top reason, whereas access from a participant’s city or origin – a key criterion when selecting a destination for a meeting or conference came in fifth place.

The survey also found that the top three sources of influence when choosing a destination for incentives are recommendations from trade associations, from incentive houses and travel partners, or word of mouth within the organisation.

Both buyers and sellers also report that sustainability is having the most positive impact on incentive travel. This correlates to the finding that a majority of programmes now include at least one CSR activity.

Buyers and sellers of incentive travel will benefit greatly from reviewing the SITE Index report, applying the findings and implementing strategies, to ensure that their business will continue to grow and the global incentive travel industry will remain strong for years to come.

Rajeev Kohli talks about the incentive trip

Recently we write about despite many challenges incentive travel is strong. We have had an interview with an expert on this subject: Rajeev Kohli, with 22 years of industry experience, and the president of SITE and the director of Creative Travel.

Trends in incentive experiences

Today, there is a much bigger service offering that incentive suppliers are being expected to deliver beyond the acquisition of a destination travel package. Customers are looking to their suppliers to provide consultation and value-added services to design a program that is unique, custom built, demographic appropriate and deliver measurable business results. And, participants are seeking more personalized, authentic experiences indigenous to the program destination, as well as activities that allow them to give back to the communities they visit.

A multi-generational workforce is changing the design of incentive programs, particularly when it comes to the types of activities offered. While golf and spa are still popular with an older generation, younger participants are seeking more authentic and immersive experiences.

A trend in activities seem is to make them more individual and at different levels of exertion to suit the demographics. For example, water sports are now surf lessons, kayaking and paddleboard rentals.  Biking options are coastal rides on beach cruisers or a city tour on regular or tandem bikes. Golf could be group or individual lessons with a video analyzing their swing or having a pro join a foursome. Food network fans are influencing the addition of restaurant hopping, food tasting options and beer, wine, tequila and scotch tastings and how they pair with food. Spa is still popular but it requires more individual offerings of treatments, fitness/health speakers, private or small group workout lessons, etc.

Millennial’s preferences for fun personalized workouts, healthy foods and holistic wellness are fueling trends with far-reaching implications for the travel and hospitality industry. Wellness is one of the areas that planners are focusing on to ensure that we are catering to these preferences. For example, supplying bikes for delegates to use to explore the destination or providing guides for delegates to walk the route to venues that are within walking distance and just simply require an earlier meet time.

Why incentive travel works and what are the most effective motivational levers

Research by the SITE Foundation confirms that incentive travel works. Once people have earned enough money to provide for their basic needs, they are driven by a desire to raise their self-esteem—not just their earnings. Most people feel that it is unacceptable to brag about their earnings or cash bonuses to their peers, family and friends. Incentive travel does not have that same problem. Although spending your own money to take a trip to an exotic destination may be perceived as frivolous, it is perfectly acceptable to talk about a travel award and say how great it was to earn it. This is why incentive travel programs must be created to provide experiences that a typical traveler would not think to do on their own, financially afford to do on their own, or even be able to do on their own, if it wasn’t organized as a group activity.

If a program’s objective is to attract and retain employees, studies show that “qualifiers” have an increased send of loyalty to their company, a sense of belonging that makes good employees stay where they are. People will strive that much harder to earn a trip to a destination they have always dreamed of visiting. An once-in-a-lifetime, high-end travel experience creates lasting memories that will be talked about and shared by participants and motivate future performance. And, during a program the positive reinforcement given by company executives to top performers increases the ‘trophy-value’ of the travel award and its usefulness as an incentive. Each time that the participant remembers a trip, they are reminded of the recognition, which increases their commitment to the company.

Destinations: are they changing, are we going back to long haul? What are the strongly emerging destinations?

With budgets increasing and air prices stabilizing, we are beginning to see a return to long-haul destinations, particularly to emerging destinations that offer good value for the money over traditional destinations.  Of course, the choice of destinations is also being off-set by concerns for safety and security.

Today’s incentive customers are seeking new or ‘reinvented’ destinations that provide unique, authentic and memorable experiences. There are many destinations that fascinate incentive planners – countries that offer great experiences in culture, gastronomy or adventure – and emerging and non-conventional destinations may be best able to deliver something different.

To be considered “ideal” an emerging destination must be able to demonstrate that they have a solid infrastructure – sufficient airlift, four- and five-star hotels that accommodate groups; experienced ground suppliers; interesting cultural activities and off-site venues. It should also be actively investing in tourism; have a strong potential for promotion and should be economically and politically stable.

Some emerging destinations: Southeastern/Eastern Europe – Slovenia, Croatia, Poland, Czech Republic.Baltic Cruises-Southeast Asia – Vietnam, Malaysia. Latin America – Panama, Colombia. Winter Destinations – Iceland, Canadian Rockies, Colorado Rockies, Swiss/Italian Alps

As the world changes, so does incentive travel

Destinations the world over are dealing with the fallout from unpredictable events – incentive travel can help keep ties strong

The past year has seen the world change in ways one could never have dreamed of. Acts of terror, national elections and extreme social and economic policies – there is no region in the world that has not been impacted by a changing geopolitical environment. From terror, to extreme weather, to mosquitos, the travel and tourism industry cannot anticipate where our next challenge will come from.

Travel and tourism is the largest industry in the world. Sustained demand, together with its capability to generate high levels of employment, continue to prove the importance and value of the sector to global economic development and job creation. The latest report from the World Travel and Tourism Council (WTTC) shows that the global travel and tourism industry employs more people than the automotive manufacturing, banking, mining, chemicals manufacturing, and financial services sectors. Travel creates opportunities, empowers communities and enhances local livelihoods, yet it is the one economic sector that gets affected the most by any turbulence in any part of the world.

As the world changes, so does incentive travel. It is here I find the dichotomy in

OUR INDUSTRY’S SUCCESS REQUIRES AN UNDERSTANDING OF VARIOUS CULTURES

words and actions. Incentive travel is about motivation. About providing that special impetus to make one’s customers or employees feel good about their jobs. But incentive travel is also about doing right by the destinations we visit. Incentive groups not only leave footprints behind, but also valuable dollars in spending. So, when a destination is suddenly excommunicated, the effects are tremendous. Coming from India, a developing nation, I understand this very well.

Is not travel also a socially responsible activity? Do we not support local cultures, people and families when we take incentive groups to a destination? Do we always evaluate the consequences of placing a destination in cold storage? I have often been asked by our members across the world on why there are different yard sticks for judging an incident in the developed world and the developing? I wish I had an answer that could make everyone happy.

Terrorism knows no distinction between race, colour or creed. London, Paris, Sao Paulo, Istanbul or Bangkok are all equally safe or unsafe. Companies who sell, buy or source across different nations have a collective responsibility to stand up to those that wish to keep us home and show them that we will not be cowed down. This does not mean we discount real dangers, but rather we do not label every incident the same.

The bottom line is that in the world of incentive travel we often work with companies that are global. Companies who have strong economic ties across the world. Incentive travel provides an ideal platform to build stronger relationships

among colleagues from around the world. It promises unique experiences for qualifiers, exposing them to new destinations and expanding their understanding of people from different countries and cultures. In turn, it helps foster greater understanding, tolerance and empathy for others.

Our industry’s success requires an understanding of various cultures in order to design
programmes that embrace global diversity. Incentive travel programmes provide a
bridge between the power of diverse travel experiences that inspire people to deliver excellence – and the sense of human solidarity we envision as the most important benefit of a global economy.

SITE remains a champion for the global business marketplace, particularly for the experiences that serve as real inspiration for people, whether they are across the street or across the globe. Our international board of directors – made up of industry leaders from nine different countries is committed to engaging our members, chapter leaders, sponsors and partners to create a strong sense of community built around our core values of connections, creativity, trust and results. This is why it is more important than ever for industry organisations like SITE to embrace our responsibility to advocate for a world that is safe, open and inclusive, and educate our clients that today’s world is a lot smaller.

The world will always change. That is a constant. I call on the global incentive travel industry to embrace this reality and take on the challenge of delivering exceptional experiences with an open mind and large heart.

Off the Beaten Path

How to size up emerging destinations for incentive travel

Incentive travel is, fundamentally, a trip that offers participants once-in-a-lifetime
experiences that they are most often unable to easily afford on their own. Today’s
incentive travel planners are seeking new destinations that provide unique,
authentic, and memorable experiences. There are many destinations that fascinate
incentive planners — countries that offer great experiences in culture, gastronomy,
or adventure — and emerging and unconventional destinations may be best able
to deliver something different.

However, to be considered ideal, an emerging destination must be able to demonstrate that
it has a solid infrastructure, sufficient airlift, four- and five-star hotels that can accommodate
groups, experienced ground suppliers, interesting cultural activities, and off-site venues. It should also be actively investing in tourism, offer good value for the money over traditional destinations, have strong potential for promotion, and enjoy economic and political stability.

four- and five-star hotels that can accommodate groups, experienced ground suppliers, interesting cultural activities, and off-site venues. It should also be actively investing in tourism, offer good value for the money over traditional destinations, have strong potential for promotion, and enjoy economic and political stability.

A poor climate, health concerns, terrorist threats, and uncertainty about safety negatively impact the destination choice. This is why it is so important for incentive planners to have strong relationships with trusted DMCs and ground suppliers to ensure that they have all of the facts and are not just reacting to what is in the news. Local suppliers can advise you of the real situation and can help with due diligence to assess any potential impacts on your event.

Fam trips, trade shows, and industry events are effective ways for planners to learn about and
experience an emerging destination for themselves. You learn the most by firsthand experiences, and there is no better platform for that than the SITE Global Conference. With 2,000-plus members in 88 countries, the SITE global community serves as a valuable source of information on emerging destinations and incentive travel trends. I encourage you to join our community to connect with experienced incentive travel professionals from almost any destination in the world.

During this year’s conference — Nov. 5-7 in Panama City — delegates will explore for

themselves Panama’s potential as an incentive travel destination through experiential learning and illuminating pre- and post-tours. To whet your appetite for Panama — and to learn about three other emerging incentive travel destinations – please turn the page.

Incentive Travel Works

At a time when workplace engagement levels are sagging, incentive travel proves effective

According to a recent report by Gallup, “the world has an employee engagement crisis, with serious and potentially lasting repercussions for the global economy.” Recent tracking by Gallup Daily shows that 32 percent of employees in the U.S., and only 13 percent of employees worldwide, are engaged (meaning they are involved in, enthusiastic about, and committed to their work and workplace). While some companies believe that financial gain is an employee’s biggest motivator, studies suggest that non-cash incentives, specifically travel, have more impact and lasting value.

Research by the SITE Foundation confirms that incentive travel works. Once people have earned enough money to provide for their basic needs, they are driven by a desire to raise their self-esteem — not just their earnings. Most people feel that it is unacceptable to brag about their earnings or cash bonuses to their peers, family, and friends. Incentive travel does not have that same problem. Although spending your own money to take a trip to an exotic destination may be perceived as frivolous, it is perfectly acceptable to talk about a travel award and say how great it was to earn it. This is why incentive travel programs must be created to provide experiences that travelers would not think to do on their own, could not afford to do on their own, or would not even be able to do on their own, if it wasn’t organized as a group activity.  

If a program’s objective is to attract and retain employees, studies show that “qualifiers” have an increased sense of loyalty to their company, a sense of belonging that makes good employees stay where they are. People will strive that much harder to earn a trip to a destination they have always dreamed of visiting. A once-in-a-lifetime, high-end travel experience creates lasting memories that will be talked about and shared by participants and motivate future performance. And, during a program, the positive reinforcement given by company executives to top performers increases the “trophy value” of the travel award and its usefulness as an incentive. Each time that the participant remembers a trip, he or she is reminded of the recognition, which increases their commitment to the company.

Choosing a destination and an itinerary that will motivate the target audience is a small part of the program. Designing a successful incentive program demands cooperative effort between corporate managers who identify the business objectives and skilled planners who can create a program to achieve those objectives. Before designing an incentive program, planners should ask: What is the business intent and what are the objectives? How will the program be measured? How do we encourage the best job performance? What can we do to ensure the program is meaningful, motivational, memorable, and delivers the desired business results?

Understanding the objectives of a program and how they align with an overall engagement strategy, and defining what motivates employees are keys to a program’s success and improved bottom-line results. When the goals are achieved, the investment in a program can be justified.