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From Talent Wars to Big Data: 5 Trends Affecting Incentives

From Talent Wars to Big Data: 5 Trends Affecting Incentives

These major shifts are having an impact on corporate incentives, according to the Incentive Research Foundation

1. The Battle for Talent

Despite the unemployment figures, hiring events abound, companies are poaching A-players from their competitors, and the Baby Boomer generation is beginning to retire. The impact of the latter is unprecedented: An estimated 10,000 employees will turn 65 today and will continue to do so every day for the next 20 years. Companies will need new strategies for attracting the best talent, and will use incentive travel to recruit new workers and to retain talented employees.

2. Sophisticated Digital Consumers

Social networking and the proliferation of mobile devices have created an increasingly informed consumer, with access to everything from competitor pricing to product reviews. As online retail grows more personalized and the average customer more sophisticated, online incentive platforms will need to keep up. Future programs will track previous awards, suggest alternative awards based on personal preferences, connect to the winner’s social network, and be accessible on multiple mobile platforms. Virtual gift cards and gamification, two current trends in online awards, will continue to grow.

3. Big Data

Companies will expand their use of data beyond sales and program metrics to include social media metrics, mobile platform metrics, individual participant preferences, and demographic data. In addition to the data they receive from their internal technology, they will seek external data for a more comprehensive view of their programs.

4. Well-Traveled Winners

The IRF has tracked incentive travel trends for the last six years through its semi-annual Pulse Studies. The current snapshot shows that, on average, 36 percent of planners are increasing their budgets year over year, with only 14 percent decreasing them. However, the last four Pulse Studies have shown that only an average of 7 percent of planners are increasing the duration of their programs and 9 percent are increasing their program’s size (measured in room nights).  

So where is the growth? In non-meal components such as including all airline fees, off-site excursions, transfers, and gifts, all of which create a richer experience for the well-traveled attendees.

Also, as companies look beyond North America, the Caribbean, and Europe to appeal to this well-traveled attendee, they will find Central America, South America, and Asia ready for incentives, with increasingly sophisticated luxury properties and infrastructures. The IRF’s top emerging destinations are China, Bali, Vietnam, and Peru.

5. The Improving Economy

The economy is having a positive impact on incentive merchandise programs. According to more than 56 percent of respondents in the fall 2013 Pulse Study, financial conditions were having either a ”moderate” or “significantly positive” impact on their ability to plan and implement merchandise incentive programs—the highest positive response since the study began. Forty-two percent of planners are increasing their budgets in 2014. Luxury goods are returning, though electronics are still the top merchandise choice (used by 40 percent of program owners), followed by jewelry, watches, and open gift cards (each offered by about a third of planners).

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