Rewarding staff for a job well done is a simple concept. How to reward them, particularly when the incentive takes the form of a gift voucher, is a lot harder to fathom.
A recent Whitbread Leisure Vouchers (WLV) survey, sent out to 5,000 businesses and 5,000 consumers, revealed people like incentives based on fun and leisure. Yet many direct marketing and incentive agencies still offer designated shopping vouchers because they are a safe bet and have succeeded in the past, suggesting incentive schemes are in danger of becoming stale.
Bill Brown, general manager at WLV, says companies’ incentive budgets are often administered by people who fail to ask whether staff are happy with what is offered to them. “There’s not much research after the event to find out whether people have enjoyed the incentive, or whether the reward has made any difference. And they’re not asked whether they want something different,” he says.
Paul Hunter, marketing manager at Kingfisher, says: “I would rather see our voucher used in an appropriate manner. I don’t want to hear people saying they would have preferred a travel voucher – whoever is running the programme hasn’t bothered to find out what turns their people on. It has to come down to what’s most appropriate to the end user.”
Brown makes the further charge that staff responsible for handing out incentives don’t think much beyond their budget. “It’s very much a question of ‘what’s the budget, how much can I spend, what’s the discount?’, rather than saying ‘what’s going to lever my business, what’s really going to make a difference?’ I think that happens an awful lot.”
By not asking staff what they want, some companies are still making the mistake of offering products when vouchers would be far more appropriate.
Hunter says a client recently told him he had offered his salesforce Waterford crystal for the past five years. “I wonder when he last asked his staff what they really wanted? How much Water ford crystal can a person have?”
However, incentive companies refuse to take the blame, insisting they are doing a thorough job. Phil Jones, marketing manager at incentive agency Motivforce, says: “We wouldn’t dream of starting a programme without recommending to the client that they thoroughly research the recipients of the award so we can gauge their profile and establish what’s going to motivate them.”
Jones doubts whether any agency would run an incentive scheme that ignored the wishes of staff.
He instead points the finger at company-run schemes: “I would imagine it could happen with in-house incentive schemes where they may have traditionally used Marks & Spencer and blindly go down that route and assume everybody will be motivated by M&S vouchers.”
Even if a company is receptive to the demands of its staff, an inherent problem is that people have different preferences, so offering a choice of rewards is often the safest option.
DEK Printing Machines offers Kingfisher vouchers as one of six schemes, including Boots, Argos, M&S, WH Smith and Thomas Cook. Payroll supervisor Dennis Card explains: “Staff asked for something different, so someone did a quick straw poll and those six seemed the most popular.
“Kingfisher accounts for about a third of the total and is one of the most popular because of the choice of B&Q, Woolworths, and so on.”
While DEK was keen to follow employees’ suggestions, Card explains that it wasn’t viable to offer any more than six options. “They were asking for more alternatives as well, but we drew a line because obviously you’ve got to keep a stock of them and we didn’t want tens of thousands of vouchers lying about.”
Motivforce also believes that offering a choice is by far the best option. It can issue store point vouchers, allowing staff to divide their rewards between, say, M&S and Thomas Cook.
Jones says the most requested vouchers are for M&S, with Thomas Cook a close second, perhaps signifying that leisure is now an important aspect of incentive schemes and people don’t just want high-street vouchers.
Virgin Vouchers stress the value of leisure, from the latest CD in a Virgin Megastore to a night at a Virgin cinema or skydiving lessons. Andrew Silver, sales and marketing director at Virgin Vouchers, believes people’s aspirations have changed and leisure time has become far more important, putting the emphasis on experience-related rewards. “Increased emphasis on leisure time and getting the most from it has influenced the desire to do something special and exciting,” he says. “Our research has shown that memorable experiences are the most motivational awards.”
The Automobile Association uses Thomas Cook vouchers. However, Karen Collins, incentives advisor at the AA, points out that staff preferences can be seasonal. “The most popular is M&S but Thomas Cook and Going Places become popular during the summer,” she says.
Hunter says many of his clients believe one of the disadvantages of travel vouchers is that there are often restrictions and, inevitably, staff have to put some of their own money towards the reward.
There is also an important distinction between consumer and business incentives. Designating shopping vouchers to be distributed to the public as part of a direct mail campaign has been going on for a long time. Perhaps the mistake some companies make is treating business incentives differently to consumer promotions.
“We are all consumers at heart. And it’s strange that when we leave the high street and come to the office we wear a different hat and think differently. We tend not to think like consumers when we’re putting together sales incent ives for our team,” says Brown.
UK companies spend more than &£600m every year on incentive vouchers, and yet the chances are that the vast majority of these companies are not making the most of them.
As far as business incentives are concerned, one of the biggest mistakes companies make is presuming to know what vouchers participants will want. It is imperative staff are given a say in choosing rewards, otherwise voucher-based incentive schemes will have little or no motivational benefit, and much of that &£600m will continue to be wasted.