THE LAST WORD

The incentive industry state of play trends and opportunities

As I settle down to write this article it would be wrong of me not to pause and reflect on how the pandemic – locally and around the world – has wrecked so many businesses, careers and lives. Eighteen months in and it is still far from over and the world of work has certainly changed.

By David Sand, chief executive officer and founder of Uwin Iwin.

People have shown much grit and determination and some industries have grown in dynamic ways, while others have suffered and new ideas and businesses are being birthed all the time. The business of engaging people in work, rewarding, recognising and inspiring them is still very much at the forefront of this dynamic world we live in and the incentive industry has as much relevance as in any time before.

During the pandemic I have been very grateful to our three international incentive industry associations that have kept up research, global insights and membership engagement. Site (Society for Incentive Travel Excellence), IRF (Incentive Research Foundation), and the IMA (Incentive Marketing Association). Much of what I share is referenced to material created or jointly created by these fine organisations.

In South Africa, and in most countries around the world, incentive travel revenues – both inbound and outbound – have come to almost a complete standstill. But this does not mean that no work has been going on. Massive efforts have been put into campaigning for postponements rather than cancellations, sometimes as many as three new dates established and then shifted and, in some cases, finally cancelled. A rather grim, frustrating, and economically unproductive process. Businesses that have survived have managed to shift some of the budget towards other reward options and are now only planning trips in 2022 that will possibly be smaller group sizes. Businesses that are only involved in travel fulfilment have been worst hit, whereas those who are involved in the full services of incentive reward design, launch, management, and fulfilment have been in a far better position to weather the storms.

Worldwide, there has been a significant shift and growth in digital rewards and merchandise catalogues — as much as 33 per cent reported by the IRF surveys. These rewards are individual and may be deployed quickly and effectively. The shift to a work-from-home virtual office norm has had leading organisations seeking new ways to recognise people in ways that still say your contribution has been seen and is appreciated.

Design of incentive programmes has also had to shift to accommodate the new work-from-home normal to be more inclusive and broader-based thoughout the organisation. Where traditionally travel programmes reward the top 10 per cent, designers are focused on reaching the vital 70 per cent, where performance shifts may have an even greater impact on the organisation’s culture and objectives. This, by no means, means that travel is no longer relevant — it certainly is. With the rollout of the vaccine programmes underway there is a huge pent-up demand for travel in general. Incentive travel will still be highly desirable and meet the face-to-face objectives that are still so important for relationship building through shared experiences.

More personalisation and greater choice are an ongoing trend that incentive designers are building into programmes, where reward mechanisms deliver value and allow the participant the choice of redemption. Key is to deliver with care, love and a special attention to the individuals receiving them. Hybrid programmes that offer shorter-term digital rewards available to the broader organisation and longer-term travelrelated offerings for the very top achievers, create a wholistic approach to design.

Digitisation of the incentive process from launch, day-to-day management, monthly reporting and participant engagement was trending long before the pandemic but has certainly accelerated with wider client adoption during this time. Incentive agencies who were ahead of this curve, and have expertise to offer its customer base, have survived and will thrive.

Aligned to the digital trend has been the ongoing need for greater data security, compliance with POPIA in our world and General Data Protection Regulation (GDPR) requirements in Europe. These requirements will be for all aspects of the incentive world and we keep our eyes open as to how the travel vaccine ‘passport’ may or may not impact the movement and options for incentive travel.

Contracting and contingency planning has never been this rigorously attended to. Phenomenal efforts have been put into protecting both clients and providers alike. Clarification of the force majeure clauses to include diseases and what the remedy will include — be it, postponement, cancellation, or reduced performance. Contingency planning is here to stay and, with ongoing waves of Covid, we are all too familiar with the unexpected now being more expected than not.

Expect to see ongoing consolidation in the industry, and the ongoing adaptive new concepts that are being driven by innovation and matching opportunity with technology advances. There is also the ongoing but growing more effective voice of climate change being demanded by consumers and reacted to by big corporations. The green agenda is firmly on the table and there are several amazing organisations that deliver reforestation, biodiversity protection and carbon offsetting that we have already begun to partner with for the future.

Opportunity exists to help organisations rethink their incentive strategy and to embrace the benefits of a digital solutions set. Currently, estimates in the US is that only about 40 per cent of organisations that run incentives are doings so digitally, presenting a significant opportunity. In South Africa I would estimate the opportunity to be similar.

There are certainly hopeful signs that fully vaccinated travellers will have options to travel internationally in 2022 and the incentive travel industry will see a restart. Our ability to recover economically and socially from the recent political unrest and the pandemic will be the task we all have to take up and overcome together. Incentives have a huge role to play in all areas of our economy and my hope is that, in some significant way, this industry will play its part and have its place in the sun once again.

Who is David Sand?

David Sand is the chief executive officer and founder of Uwin Iwin, established in 1994. A global incentive expert, having travelled, worked and consulted to many destinations and global corporate accounts. He served as the global president of Site in 2013. Trustee of The President’s Award, South Africa, Advisory Board member for Rwanda Convention Bureau (RCB) https://www.linkedin.com/in/ uwiniwin/