Your portal to
enterprise engagement

IRF Pulse Survey Looks at the Economy's Impact

Many industry professionals are wondering whether the current economic downturn has had a negative effect on the incentive industry. Given its mission of advancing the science of incentives, the Incentive Research Foundation (IRF) decided to survey industry professionals to get their opinion of the down economy’s impact on the industry.

A Summer 2008 Pulse Survey was designed to determine, in a more precise way, the existence and character of these effects. Invitations to participate in this online survey were sent to 618 incentive providers, suppliers to the industry and corporate incentive travel buyers. Survey participants represented the following groups:

Sony

Travel Programs Hit Hard

Most respondents say the down economy has had an overwhelmingly negative impact on their ability to plan travel incentive programs. When asked, “Overall, how has the economic downturn impacted your ability to plan an incentive travel program?” here is how they responded:

Some of the things people are doing to help counteract those negative effects include adding round trip transfers to air travel packages and in some cases picking up all costs for air transportation. When asked, “With regard to the air transportation portion of your incentive travel program, what techniques, if any, have you used to enhance this component of your incentive travel program?” a majority of respondents cited the following two techniques:

While nearly half (48%) of respondents reported no destination changes, a significant percentage (44%) say they’ve shifted from international to domestic destinations. It’s also noteworthy that there has been a slight shift from land to cruise destinations.

Similarly, when it comes to accommodations, one in three respondents reported no change, while an approximately equal number made the following alterations in accommodations:

Finally, more than half of those surveyed indicate they’ve made a reduction in non-meal-related components of their incentive travel programs. When asked, “With regard to the sponsored (paid by your company) non-meal-related components for your incentive travel program, what changes, if any, have you made?” they said:

[ return to top ]

Non-Travel Programs Hang On

In the case of merchandise/non-cash incentive programs, the impact is less severe, with slightly less than half of respondents indicating the down economy is having a negative effect on their ability to plan and implement such programs. In response to the question, “Overall, how has the economic downturn impacted your ability to plan and implement a merchandise non-cash incentive program?” they said:

When asked, “With regard to your merchandise non-cash incentive program, what changes, if any, have you made with your award selection?” the most frequently mentioned changes were:

[ return to top ]

Long-Term Effects

When it comes to long-term effects, nearly three-quarters of respondents say the down economy has caused a permanent change in how the success/ROI of future incentive programs will be measured. When asked, “To what extent has the down economy caused you to create different or more precise measures of success or ROI that have permanently changed how your future programs will be measured?” a full 73% say they’ve implemented different measures, while 27% indicated no change.

Similarly, a majority of respondents (61%) report that the down economy has resulted in incentive program budget cuts, and when asked, “If your program budget has been cut due to the down economy, which of the following elements were cut?” the most frequently mentioned areas were:

[ return to top ]

Other Influences

Economic factors are also influencing incentive program design in other ways. When respondents were asked whether they agree or disagree with the following statement: “My Company’s financial forecast influences the design and implementation of incentive programs” they said:

Respondents were divided about whether “competitor reactions” impact the products and services included in their company incentive programs. They were asked if they agree or disagree that “Reactions to our incentive program by our competitors directly impact the products/services that are included in our incentive program and the point values assigned to each product/service.” They said:

Finally, respondents were asked whether they agree or disagree that “Visibility by internal and external non-incentive audiences prevents us from offering awards that are considered extravagant, and as such we have significantly changed the type of awards and program inclusions for our incentive program.” Here’s what they said:

For more information on this IRF Pulse Survey, go to http://www.TheIRF.org.

[ return to top ]

EGR International Inc.

Marriott Bloomington-Normal

McBassi

Canon