Analysis: Is Enterprise Engagement Tech Space Taking Shape With Recent US Entrants?
By Bruce Bolger
Still a Nascent, Fragmented Market
Recent US Arrivals
The Pricing Conundrum
Over the last two decades, the bulk of people technology investment dollars have flowed either to specialists in human resources technology or customer engagement, overlooking with a few exceptions the ability to power engagement of almost all stakeholders across the enterprise on a seamless, holistic platform. With the arrival of more Enterprise Engagement tech players, the chances are increasing that the Enterprise Engagement technology marketplace will begin to crystallize. If so, it’s growth could mirror the model of the Customer Relationship Management technology market, which has hundreds of technology players, but which is dominated by a few players such as Salesforce, Hubspot, and Microsoft that have created a vast marketplace of reseller specialists to help clients implement their technologies.
Enterprise Engagement technologies are distinct from employee recognition technology in that they focus holistically on multiple engagement touchpoints and encompass both sales and non-sales employees, as well as customers, distribution partners or any stakeholders. Click here for an overview of Enterprise Engagement technology. Once organizations recognize that they can achieve all the functionality of a recognition program with a platform that helps align and engage all stakeholders, the Enterprise Engagement technology is bound to heat up with or without the addition of new players.
The so-far quiet arrival in the US market of Belgium-based Motisha and India-based Xoxoday alone do not represent signs of hockey-stick growth. Most CEOs at organizations large and small still have no idea that it’s possible for even smaller organizations to holistically engage sales and non-sales employees, supply chain and distribution partners, communities—any stakeholder—not just with rewards but with ongoing multi-media organizational communications; tests, surveys, feedback, and games; suggestions; referrals; learning; wellness, safety, and diversity, equity, and inclusion (DEI), social recognition, rewards, etc. with unparalleled qualitative and quantitative analytics. All of this exists today and is at use at many companies.
The world’s largest companies have legacy employee intranets that bring together multiple engagement and rewards technologies with a single sign on. However, for the majority of nearly 200,000 companies, not-for-profit or government organizations with more than 100 employees, the Enterprise Engagement technologies provide a relatively easy way to align all the levers of engagement to address the needs of each stakeholder audience without need for a costly Intranet platform.
Still a Nascent, Fragmented Market
So far, the Enterprise Engagement technology marketplace is only a fraction of the size of the $60 billion Customer Relationship Management market. Most Enterprise Engagement platforms are proprietary in that they are sold by incentive companies and integrated with their program design, implementation and support services, and rewards platforms. The only industry player we know of in the US that appears to be moving to a Salesforce-like model is private-equity backed, Canada-based CarltonOne. It’s Power2Motivate front-end technology is sold independently of its Global Rewards Solution merchandise, gift card, travel, and e-code redemption platform, to any engagement, loyalty, or recognition solution provider, on a private label basis. According to CEO and founder Rob Purdy, CarltonOne has developed a worldwide community of large engagement, marketing, loyalty and/or recognition companies that private label either its Power2Motivate front-end program management and GRS for reward redemption, order management and support in over 180 countries. Like Salesforce, it has developed a complete learning and support platform for its growing worldwide reseller community, reports Purdy.
INCENTCO, a Florida-based incentive company that until recently focused mostly on the multi-family housing market, is now making its Enterprise Engagement platform available to any organization or solution provider, explains Gerry Wiatrowski, Co-founder and Chief Strategy and Marketing Officer. Explains Wiatrowski, “our front-end program management technology is rewards neutral. While we have developed a robust offering of gift cards for any demographic, we gladly connect with whatever rewards option a solution provider or its client might prefer.” See ESM: INCENTCO Steps Up Visibility With Focus on Design, Technology, and Open Source Rewards.
Motisha and Xoxoday join a surprisingly small group of Enterprise Engagement technology providers, almost all of whom generally combine their technologies with their reward options or other support services. Examples are companies such as Augeo Marketing, an engagement and loyalty company, which markets the only ISO 10018 certified Enterprise Engagement technology. Its customers are large enterprises running multiple campaigns with multiple audiences for enterprise clients as part of its overall suite of services. Incentive company leaders Maritz, ITA Group, and BI Worldwide barely mention technology on their web sites although all reportedly offer technologies to support engagement programs.
Others with their own or private-label platforms, such as HMI Awards, Next-Level Performance, Incentra, Partners for Incentives, Hinda Incentives, Transcend Engagement, and Harco Incentives, usually offer the technology along with their rewards and other services. Founded in 2004, Paramax developed one of the first Enterprise Engagement technologies which it sells along with its reward catalog solution.
Recent US Arrivals
Fintan Connolly, Chief Revenue Officer, highlights the ability of “Motisha’s platform to address all stakeholders. Sales incentives, employee recognition, loyalty, with pulse surveys, communication, training, and other capabilities. We have clients running four or five programs using various features with different audiences at a time.” The platform, he adds, can easily be customized and is now available in 30 languages with redemption in 130-plus countries. The company works with both solution providers and directly with large clients in Europe, the UK, US, and Asia, and plans to set up a local office in the US early this coming year, he says.
The advantages of being able to support multiple audiences and engagement levers, he says, “is the ability for companies to grow with us. They can start with one program and audience and expand as they see the results.”
Xoxoday is entering the US Enterprise Engagement technology space with human resources, sales, channel, and now loyalty solutions under the local direction of IRR industry veteran Paul Haynes, Executive Vice President Americas, who says he's actively hiring for sales, operational, and marketing roles. The company, launched about 11 years ago, recently merged with Giift, a Singapore-based loyalty company with offices around the world including New York City, and received $30 million in investment. With the merger, the company is nearing 500 employees and probably ranks in volume among the top five incentive and loyalty technology companies in the world, Haynes estimates. Xoxoday is now focusing on supporting US incentive, promotional and other agencies or organizations seeking engagement solutions. On its web site, Xoxoday says “it is targeting the $5 trillion worldwide rewards, payouts, and incentives industry, which is largely still powered by legacy systems or manually. This market is growing strongly and is expected to reach $6.3 trillion (not a typo, you read this right) by 2027.”
Haynes takes that statement a step further. “We're a performance improvement company that focuses on employee engagement; channel, sales, call center compensation, and global rewards, with worldwide loyalty programs being our newest addition.” He says the company has recently brought on three new distribution partners in the US, one of them a promotional distributor, and will rapidly expand its US footprint with a flexible model for pricing and a rewards-neutral approach. “The data gained from the use of our platform helps our clients learn what types of rewards are going to work best for their employees or other stakeholders.”
The Pricing Conundrum
Unlike in the world of CRM, in which many companies pay upwards of $70 per month per employee, not to mention development fees in the hundreds of thousands of dollars or more, the budgets for engagement technologies of almost any type are paltry in comparison. This speaks volumes about the value most companies place in their employees versus their customers.
Efforts by engagement technology providers to charge per-seat fees run up against huge pushback in human resources, which often has recognition budgets of less than $400 per employee for the entire year with little clear metrics to justify a further investment, such as enhanced retention or willingness to recommend talent or customers. Most incentive companies waive these per-seat fees in favor of a flat bandwith- and customer-support based monthly retainers with markups on rewards. There is an increasing trend for these companies to charge for points upon issuance, with the breakage either retained by the incentive or recognition company or shared with the end-user customers. See RRN: Opinion: The IRR Pricing Model Is Broken.
The world will know that organizations value employees as much as customers when we see them spending as much to engage them.
The Enterprise Engagement Alliance at TheEEA.org is the world’s first and only organization that focuses on outreach, certification and training, and advisory services to help organizations achieve their goals by fostering the proactive involvement of all stakeholders. This includes customers, employees, distribution and supply chain partners, and communities, or anyone connected to an organization’s success.
- Founded in 2008, the Enterprise Engagement Alliance provides outreach, learning and certification in Enterprise Engagement, an implementation process for the “S” or Social of Stakeholder Capitalism and Human Capital Management and measurement of engagement across the organization.
- The Enterprise Engagement Alliance provides a training and certification program for business leaders, practitioners, and solution providers, as well as executive briefings and human capital gap analyses for senior leaders.
- The EEA produces an education program for CFOs for the CFO.University training program on Human Capital Management.
- Join the EEA to become a leader in the implementation of the “S” of ESG and Stakeholder Capitalism.
- The ESM information portal and The Enterprise Engagement Advisors Network solution provider marketplace cover all aspects of stakeholder engagement, and the EEA information library lists dozens of resources.
- The RRN information portal and Brand Media Coalition marketplace address the use of brands for gifting, incentives, recognition, and promotions. The BMC information library provides information and research resources.
The EEA Human Capital Management and ROI of Engagement YouTube channel features a growing library of 30- to 60-minute panel discussions with leading experts in all areas of engagement and total rewards.
- Enterprise Engagement for CEOs: The Little Blue Book for People-Centric Capitalists. A quick guide for CEOs.
- Enterprise Engagement: The Roadmap 5th Edition implementation guide. A comprehensive textbook for practitioners, academics, and students.
- Organizations of all types develop strategic Stakeholder Capitalism and Enterprise Engagement processes and human capital management and reporting strategies; conduct human capital gap analyses; design and implement strategic human capital management and reporting plans that address DEI (Diversity, Equity, and Inclusion), and assist with managed outsourcing of engagement products and services.
- Human resources, sales and marketing solution providers profit from the emerging discipline of human capital management and ROI of engagement through training and marketing services.
- Investors make sense of human capital reporting by public companies.
- Buyers and sellers of companies in the engagement space or business owners or buyers who seek to account for human capital in their mergers and acquistions.