Incentive Travel: The Ultimate 2021 Guide

Is incentive travel still relevant even after the pandemic? The short answer is YES. Incentive travel will continue to be a popular reward and proven method for motivating employees to reach a company’s goals.

Incentive trips will definitely skyrocket once the pandemic is over. Your employees have been stuck at home for more than a year and there’s nothing like an exotic all-expense paid trip to motivate them.

Incentive travel programs motivate your team to increase sales. They improve employee satisfaction and strengthen company loyalty.

With the vaccinations rolling out, travelling will once again become accessible. And employees can look forward to company incentive trips.

What is Incentive Travel?

Incentive travel is as an all-expense paid trip companies use to reward employees who meet certain performance goals. It is a tool designed to boost the company’s performance and employee engagement.

They can be group travel programs where all the qualifiers take a trip together. Or they can be individual trips where the qualifiers take the trip with their families during their own time.

They are used to help companies reach their annual goals such as:

• achieving or going beyond the sales target
• improving customer service or retention
• decreasing employee turnover and absenteeism

An incentive travel is a recreation or leisure experience for the attendees. Although, there could be some form of professional development incorporated, this should be kept at the bare minimum.

After all, the goal of incentive travel is to reward your employees for a job well done. They’re supposed to relax and not think about work during the duration of the trip.

Incentive travel is an all-expense paid trip companies use to reward employees who meet certain performance goals.

What is an incentive travel agency?

An incentive travel agency helps businesses boost sales, productivity, loyalty and morale. They create travel incentive programs that rewards top performers with luxury trip getaways.

Luxury getaways are the best way to motivate employees to increase company sales. It’s a win-win situation. The employee gets a once-in-a-lifetime experience and the company achieves corporate success.

An incentive travel agency is different from other types of travel agency. They combine the services of a travel agency, an event planner, a marketing communications expert and a business strategy consultant. They don’t just book the most economical flights or cheapest hotel rooms. Or plan out vacations to the common tourist spots. Rather, they handle groups of people (think ten hotel rooms or more) and work with hotel sales team, airline companies, and other service providers to create the best travel experience at a really discounted cost.

Luxury travel incentives will not come cheap. Incentive travel agencies know how to work within the industry to offer the best pricing, discounts, extra inclusions and other perks.

Expertise of Incentive Travel Agencies

When you work with incentive travel agencies, you’re working with:

• destination experts. They know the best destinations that have the best accommodations, event venues and activities for large groups.
• global partners. Incentive travel agencies don’t work on their own. They have built an extensive network of DMCs (Destination Management Companies), CVBs (convention & visitor bureaus) and DMOs (destination marketing organizations). These organizations know the ins and outs of the local destination and can provide on-ground support and expertise.
• cost savers. It’s a common misconception that an incentive travel agency is a middlemen. Companies view their services as an extra cost. This is far from the truth. Savvy incentive travel agencies will save your company tons of money. They can negotiate for lower hotel rates, suggest the best time to travel, get complimentary upgrades, obtain various discounts for different activities and so much more. Not to mention they free up the time of your internal staff to focus on other things. In the end, the savings you get by hiring an incentive travel agency offsets the costs.

Incentive travel companies keep abreast with the latest travel trends. They know what experiences will resonate with your employees. They also reduce the risk of your investment in the travel program by providing a risk management plan to address any possible emergencies and roadblocks.

Incentive Travel Agencies are destination experts, global partners and cost savers. They reduce your risks in conducting an incentive travel program.

Do travel incentives work?

You might be wondering, are travel incentives worth it? Do they actually work? Will they really result to increased sales for my company?

Yes ! The effectiveness of travel incentives is a widely-researched topic backed by actual experiments and scientific data.

Incentive Travel Produce Amazing ROI

According to research, employees highly value travel incentives. Organizations who provide incentive travel experience 3x higher revenue increases. A similar study showed that incentive travel programs increased sales productivity by 18%! The team involved then went on and increased ROI by a whooping 112%! Now that’s a proven statistic showing you that incentive trips are totally worth it.

When travel incentives are implemented correctly, the increased revenues generated by the program will outweigh the huge costs.

Use financial metrics as incentive qualifiers. These metrics can be total new sales, net new sales, profitability, and so on. By having clear metrics as qualifiers, you can accurately measure the effects of incentive travel programs.

The average annual spend for an incentive travel program should be 3% of the annual income, according to the IRF. Companies spend anywhere from $2,000 to $8,000 per employee with the average being $4,000.

This figure may seem huge especially if you have several employees qualifying. But, if you are able to set the correct qualifiers and measure them accordingly, you’d be surprised at how much returns they actually bring in.

More than just the financial ROI

Companies who implement incentive travel programs report seeing not just financial metrics increase. They don’t just benefit from higher sales and increase employee productivity. Incentive trips create a lot of intrinsic benefits.

Some of these intrinsic benefits are higher employee satisfaction, retention of top performers and a more positive company culture. The IRF notes that these soft benefits translate into hard financial success metrics.

Travel incentives work not just for sales. Companies also offer travel incentives to recognize employees, channel partners and loyal customers. In fact, companies who experience the highest customer retention offer group travel incentives.

“Properly designed and executed incentive travel programs can increase sales productivity by 18% and produce an ROI of 112%.”

Incentive Research Foundation

Why is incentive travel better than cash?

According to research, employees are highly motivated by experiential rewards. And incentive trips top the list. It’s not every day that they will get to experience a luxury trip to an exotic destination. Employees, especially millennials, value experience over products or things.

Incentive travel creates lasting memories. These memories strengthen the participants connection to their employees and to the company. Experiential rewards get employees really excited and more likely to put in greater effort to achieving the reward.

Cash benefits or cash bonuses, even if substantial, are often spent for practical matters (such as towards paying off debt or to fix a leaking roof) or goes towards a savings or investment plan. Once spent, the cash is gone. There is no sentimentality or company connection made.

Incentive travel creates lasting memories. These memories strengthen the participants connection to their employees and to the company.

People also don’t take a lot about money – including bonuses. Employees who get cash bonuses won’t brag about it to their co-workers. On the other hand, employees who qualify and take incentive travels will be talking about their experience even months after the event.

Incentive travel is highly social and shareable. Imagine your employees sharing their trips in social media. It creates free publicity for your company and encourages non-qualifiers to try harder next time in order to qualify. The more employees aiming to qualify for the program, the more revenues your company makes.

What are the Benefits of Incentive Travel?

There are countless benefits in running an incentive travel program. According to research, most employees would rather receive non-monetary forms of rewards such as travel incentives.

They are popular because they create lasting memories. It’s also proven that incentive trips produce highly motivated and top producing employees. Even if you spend a lot for the trips, the results far exceed the cost. As a result, you get a great return for your investment.

Incentive travel decreases attrition rate

In a 2020 IRF Study, all-expense paid travel experiences rank among the Top 10 motivating reward types that produces increased job satisfaction. It was specifically high for the younger workforce who value memorable experiences as a reward.

Motivated employees are less likely to leave a company and more likely to remain loyal despite the difficulties an organization may encounter. They will also be more engaged in finding solutions to help the organization navigate difficult situations.

Another IRF Study conducted in 2010, found a clear correlation between incentive travel earners and tenure. Even though tenure is seldom used as a qualifier for incentive trips. majority of the qualifiers who were interviewed for the study had longer tenure in their companies. This showed that travel incentives produces loyal, and engaged employees.

It’s costly to replace an employee – especially if it’s a tenured and performing one. Lowering attrition rate should be one of the main goals of any company. This ensures that productivity will always be at its peak and the company doesn’t lose top talent to the competition.

Incentive travel increases sales and employee productivity

Research showed that when salespeople are motivated with travel rewards, they perform better. The company reached not just their sales goals but also accounts collection and inventory turnover goals. In fact, the company cited in the research experienced 112% ROI for the travel incentive they created.

A 1998 study has correlated travel incentive programs with increased productivity among those vying for the reward. Incentive trips create healthy competition among employees as they race to reach the goal.

Incentive travel builds company culture

Do you want to be known as an exciting company to work for? There’s nothing more exciting for employees than to have an annual incentive trip to look forward to. When you run a travel incentive program throughout the year, the whole company will always be excited to see who are in the race to win.

The incentive travel program will create buzz in the hallways and employees will constantly be talking about it. You’ll observe that there’s more teamwork and camaraderie among your employees as they work together to reach the goal.

What are examples of good incentive trip program?

A good incentive program should consider the participants and create that lasting memory for your employees. It’s not just about giving qualifiers plane tickets and paid nights in an all-inclusive resort. You need to provide them a group experience they can’t easily forget.

Keys to a Great Incentive Travel Program

1. Hands-on Feel. Incentive trips should not be cookie-cutter trips. You don’t want to risk any of the participants having a “been there, done that” attitude during the trip. You want them to feel that every part of the trip was specifically designed for them and they can’t get it anywhere else.
2. Team Bonding Elements. Incentive trips are the perfect time to improve your employees camaraderie as a team. There should be group excursions and activities that will make them forge stronger bonds with each other.
3. Relaxed and Away from Work Vibe. The last thing you want your employees to feel during an incentive trip is that they are in another extension of the office. You may inject some professional company program during the duration of the event but this should be at the bare minimum. You don’t want your employees feeling like their working while on a leisure trip.
4. Catered to their specific needs. Younger participants will want an adventure or exploration experience. They’d want those thrill-seeking moments that they can talk about for months. Older participants on one hand might prefer more subdued activities like sightseeing and guided tours. If the team is mixed, plan activities to cater to both types of attendees.

Incentive travel programs can be within the country or abroad. The place doesn’t really matter. What matters is how you’ve custom-built the experience for your employees. The key to successful incentive trips is the unique experience it creates for the participants.

CONCLUSION

Incentive trips are great ways to motivate your employees and create a positive company culture. They are win-win situations. Employees get to experience something they won’t normally be able to. Companies achieve sales target and retain their best employees.

Companies of all sizes can create an incentive travel program. You don’t have to be a Fortune 500 corporation to reward your employees with incentive trips. Here at Magia Retreats, we help businesses of all sizes come up with a unique and custom-built incentive trip.

Our expertise is in finding those hidden gem experiences and giving personalized attention to your participants. We work with your budget and your goals and help you create once-in-a-lifetime, lasting memorable trips for your employees. Book a free consultation with us today.