Market optimism is leading to budget growth throughout the meeting and incentive travel industry.
The Incentive Research Foundation recently released its 2018 Trends Study, identifying key areas of change and their implications for workforce engagement, incentive travel and recognition.
Amongst the key findings for meeting planners is the IRF’s Net Optimism Score for the incentive travel industry, which is up almost 20 points over last year. This has resulted in increases to incentive travel budgets up to an average annual per-person spend of $3,915, an increase of 4%. That’s good news, but the optimism also comes with an acknowledgement from 60% survey respondents who say costs are rising faster than budgets and that they expect their newly increased budgets will go to F&B and hotel costs.
Creative Group has been ahead of the curve when it comes to tapping into and leveraging trends across the industry. In 2017, we asked 120+ incentive program leaders 10 simple questions about their programs. As a company that designs programs and experiences to help our clients reach their full potential, we wanted to know just how confident others were when it came to how well their programs delivered on program objectives, how well they motivated their teams and if they were operating in the most effective way.
It turned out that the majority of our respondents lacked confidence when it came to certain aspects of their programs, including how to mitigate rising F&B and hotel costs and maximize ROI without compromising organizational goals and objectives. When market trends begin to affect the efficacy and profitability of your programs, an in-depth sales incentive audit can help increase cost savings.
Here are other key trends that will likely affect organizations, their products and services, and the workforce in 2018.
- Building a brand-asset culture is becoming a business imperative.
A strong organizational culture can increase overall employee commitment and enhance organizationally aligned decision-making. Organizations with non-cash award programs of any kind should ensure their programs are rewarding innovation, adaptability, and brand-centric behaviors.
- Market optimism is leading to budget growth and continued consolidation.
Market optimism, coupled with the continued relative low cost of capital, means the volume and rate of mergers and acquisitions will again be a key part of 2018.
- Regulatory pressure is driving change.
Over 60% of respondents in our 2018 Outlook Study said it is difficult to stay informed about all the federal, state, and industry regulations that impact their programs.
- Cost and time tension will continue.
For corporate program owners who use third parties, it will require greater levels of trust and dialogue to help the organization feel they are receiving the greatest value and consultation.
- There will be increased focus on managing risk and ensuring safety.
With 2017 seeing one of the most active hurricane seasons on record and one of the worst massacres in U.S. history, safety, security, and risk again take center stage in incentives and reward programs. The largest implication of these concerns is simple: increased investment by all parties in managing risk and ensuring security.
- Predictive technology will expand capability.
The collection of data across multiple events means planners also hold a valuable key to discovering how attendee data augments existing internal business data and how it predicts wider people business patterns
- Wellness will reach its tipping point.
Across the board, the reduction of anxiety and a feeling of comfort will reign in 2018. Participants are not only welcoming but expecting more fitness-focused items and wellness experiences in their programs.
- Unique destination will continue to gain popularity.
Whether driven by safety and security concerns, or simply by a more travel-seasoned population, unique and offbeat destinations continue to gather popularity by respondents both in the U.S. and abroad. Demand for non-traditional meetings facilities is expected to increase by 3.8% in 2018.
- Merchandise will continue its journey to more meaningful experiences.
Almost a third of respondents to the IRF Pulse Study indicated an increase in individual travel packages (31%) and experiential rewards (37%). For rewards to matter in a world where all things are varied, abundant, and accessible, the reward must, more than ever, have a personal meaning and a personalized delivery associated with it.
- Gift cards will gain momentum.
The vast majority (almost 70%) of organizations with revenue over $100 million are purchasing more than $10,000 in rewards cards annually for their sales, channel, employee, and customer programs. However, one-third of the market has limited awareness that there is an industry designed to supply a variety of gift cards for reward and recognition buyers.
There’s a lot to unpack in this IRF study, and we highly recommend it for planners responsible for their organizations’ sales, channel, employee, and customer programs. If you have questions or need help understanding how these forecasted trends can be leveraged to maximize your ROI, give us a call. We’ve digested the report, and we’re feeling pretty trendy!
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