Let’s face it. Times are tough. The economy is still shaky, profits are down and employees nervously await the next round of cutbacks, hoping they’ll still be there when the dust settles.
So how do you justify incentive travel in an environment like this? The first thing management needs to understand is that scrapping such programs creates a couple of major problems they may want to avoid: 1) you need the boost in sales and productivity these competitions create now more than ever, and 2) your competitors will start looking a lot more attractive to your top people if they keep their incentive program and you don’t.
To maintain their competitive edge, smart companies are currently seeking out destinations with broad appeal, that are easy to get to and don’t cost a lot – which means Tahiti, Peru and Moscow probably aren’t going to make the cut this year. What you need is the ultimate combination of variety, affordability and simplicity, and that’s why more and more meeting and incentive planners are looking south, to the Caribbean and Mexico.
Depending on the demographics of your target group or incentive winners, there’s an island, seaside town, or bustling city that’s ideally suited to their needs and desires. Naturally, the best way to make sure you select the right destination is to survey participants, asking whether they’d prefer a family trip, one with just their spouse, or a solo excursion. Also ask about favorite leisure activities, cuisine, preferred accommodations, recreation and sports to narrow down your choices.
Looking for the perfect place for water-loving, activity-oriented, independent-minded types? Consider the infamous Mexican resorts of Cabo San Lucas and Puerto Vallarta or islands like Antigua, Puerto Rico and St. Martin, where sailing, sightseeing, sand and surf combine to create the ultimate getaway.
How about a destination for those who want to immerse themselves in the local lifestyle? The history, culture and cuisine of Puerto Rico, Mexico City, Jamaica and Cuba offer unforgettable opportunities for individuals or couples who really want to “go native.”
More laid-back, low-key types who would enjoy a place that boasts spectacular beaches, warm blue-green water and soft white sand would no doubt love St. John, Ixtapa/Zihuatanejo, Turks and Caicos, Virgin Gorda, or St. Lucia.
If it’s family fun, shopping and amusements you’re after, think Acapulco, Cancun, the Bahamas, St. Thomas and Aruba – which also boast the same crystal clear water, fabulous beaches and amenities that continue to attract millions of tourists to this part of the world year after year.
Or maybe you’d rather sample a number of destinations. No problem. Choose a cruise. These days, cruises are often cheaper than a flight/hotel package. Along Mexico’s Pacific coast, ships regularly visit Cabo San Lucas, Mazatlan, Puerto Vallarta, Acapulco and La Paz, and Caribbean cruises are available with virtually any combination of island stopovers you can imagine. Royal Caribbean, for example, offers departures from New Jersey, Baltimore, Norfolk, Galveston and a number of Florida cities to all points in the Caribbean, and Mexico cruises depart from Los Angeles and San Diego.
And variety isn’t just about what you do, it’s also about what you see and where you stay. In Mexico and the Caribbean, the landscape and accommodations run the gamut, from the relatively flat terrain of Cancun and Barbados to the towering volcanic peaks of Montserrat and St. Lucia to the terraced, fishing village charm of Puerto Vallarta and St. Kitts.
Looking for luxury? Book your guests into Jade Mountain in St. Lucia, just named the top Caribbean resort by Travel + Leisure magazine. An isolated, laid-back tropical paradise? Try Carambola Beach Resort in St. Croix. Full-scale family resort, casino, water park and aquarium? Atlantis in the Bahamas should be at the top of your list. Multi-story, beachfront hotels with eye-popping pool complexes, full-service spas and all the amenities? Think Cancun. Again, it all depends on how participants define their ultimate getaway and what tweaks their “wow” factor.
Now let’s talk budget. Currently, airfares and hotel rates for Mexico and the Caribbean – as with most tourist spots, given the still-tight economy – are ridiculously low. Naturally, being closer to the U.S., airfares to these destinations are a lot more affordable than those to Europe, Asia or the Middle East. And there are a number of regional and discount airlines that offer direct connections to popular Mexican and Caribbean destinations for no more than a lot of domestic flights.
The truth is, while everyone is afraid to utter the “R” word (Recession), the current economic situation allows meeting and incentive planners to use the “L” word (Leverage) to negotiate better prices, packages and amenities. And with the U.S. dollar finally regaining some ground against other world currencies, your negotiating power is getting stronger every day.
Want to save even more money? Consider adding an on-site meeting component to your incentive program. As of January 2004, conventions, trade shows and meetings in Mexico are exempt from the local tax (IVA), which is 10% on the border and 15% elsewhere for such services as venue rental, lodging, transfers, food & beverage and equipment. The Mexican Congress is also reviewing the possibility of including incentive travel. In addition, expenses for meetings and conventions in Mexico are tax-deductible to U.S. companies. And attendees also receive a full refund of taxes for merchandise over 1,200 Mexican pesos (approximately $110 USD).
The same is true in the Caribbean. Thanks to the Tax Information Exchange Agreement (TIEA) with the United States, more than a dozen Caribbean destinations are considered to be part of the North American area for purposes of claiming deductions for expenses incurred in connection with a business meeting or convention. As United States territories, Puerto Rico and the U.S. Virgin Islands also fall into the category of tax-deductible meetings destinations. This tax deduction is a result of the Caribbean Basin Initiative (CBI) Convention Tourism Tax Credit that allows U.S. companies to hold business meetings in eligible Caribbean countries or territories and to take applicable expenditures as a tax write-off.
Not only are they just a few hours from most major U.S. cities by air, but Mexico and the islands of the Caribbean are also easy to access in other ways. Contrary to popular belief, not all Caribbean islands require U.S. citizens to have a passport these days. If your group will include family members or last-minute additions, Puerto Rico and the U.S. Virgin Islands (St. Croix, St. John and St. Thomas) can lighten the logistical hassles. As U.S. Territories, American citizens still only need to show a driver’s license or other picture ID upon entry to these islands.
And given their proximity, heading to Mexico or the Caribbean means there’s no gearing up for that marathon, eight-hour trans-Atlantic flight and the debilitating jet lag that accompanies the six- or seven-hour time difference. This allows attendees to maximize their on-site time and minimize the logistical hassles involved with getting there.
Let’s see – low prices, easy access, minimal documentation, familiar time zones, unlimited choice of accommodations, geology, culture and cuisine, no meeting-related taxes…what’s NOT to like about the Caribbean and Mexico as incentive destinations?