Megan Gell
Oct 17, 2018

Takeaways from SITE, FICP and IRF's new study on incentive travel

Global industry index reveals key insights and trends.

Didier Scaillet, SITE CEO.
Didier Scaillet, SITE CEO.

The Society for Incentive Travel Excellence (SITE), Incentive Research Foundation (IRF), and Financial and Insurance Conference Professionals (FICP) have released the first joint study of the global incentive travel industry.

The index – released at IMEX America – is a wide-ranging analysis of business conditions, attitudes and expectations impacting the incentive travel and motivational events industry. “It is the biggest research project ever conducted on incentive travel, by volume and geographical spread, and the results demonstrate unequivocally that our industry is continuing to thrive and grow,” said SITE CEO Didier Scaillet, CIS, CITP.

There were more than 1,000 respondents, balanced between incentive travel buyers and suppliers, with buyers representing incentive agencies and corporate users, while more than half of the sellers are DMCs. Speaking to CEI, Scaillet said approximately 16% of respondents (160) represented 17 countries in the APAC region with the largest numbers from China (33), Singapore (27), and India (24).

“The index indicates unequivocally that the vast majority of incentive travel programs stay within their own region,” he said. “Thus large-volume Asian Incentives tend to remain in Asia with Malaysia, Thailand, Indonesia and lately, Australia, as the main destinations used.”

Key findings

Over half (54%) of buyers report an increase in budgets year-on-year with the median per person spend remaining stable at US$4,000. Corporate users report a higher median spend (US$4,550) versus incentive agencies (US$3,500).

Results also show that 65% of buyers globally are increasing the number of incentive program qualifiers: fuelled by company growth, optimism in the economy and the increasing importance of employee engagement. Asia is leading the way at 73%.

Says SITE CEO, Scaillet: “There are many reasons for the growth in the number of qualifiers, from healthy economies to internal factors such as mergers and acquisitions. Many companies are realising how much their service and support teams contribute to the organisation’s overall value and are looking for new ways to deepen their relationships with employees.

“Modern compensation systems are not set up to deal with a lot of things employees are asked to do today that are not part of their core job — things like maintaining wellness, performing in line with core values and maintaining a level of training.”

While sales and profitability remain the top reasons to run an incentive program, findings show that companies are increasing their use of incentive travel to improve engagement and strengthen employees’ identification and emotional commitment to the company.

“SITE Foundation research into participants’ viewpoints from the US, UK and India show that incentive travel helps strengthen loyalty, build trust and create feelings of belongingness. 72.4% of qualifiers said that incentive travel increased their sense of loyalty to their company, a sense of belonging that makes good employees stay where they are,” said Scaillet.

70% of buyers rate incentive travel as “effective” in achieving their business objectives. Although the objectives of incentive programs vary greatly, successful incentive programs link the reward to performance, allowing companies to drive behaviour to reach their business goals.

While the survey findings show that incentive travel is on the rise, growth isn’t happening unchecked. For instance, costs to operate an incentive travel program are going up.

“Although the findings show that incentive travel is growing, the reality is that there are counter-currents such as rising costs that may temper growth,” added IRF president, Melissa Van Dyke. “Over two-thirds of planners are taking steps to contain costs such as less expensive destinations or less expensive amenities. Fortunately, the nature of incentive travel programs allows companies to adjust them to reflect concerns with costs.”

One way buyers are getting around costs is by opting for all-inclusive destinations, who in turn, are working hard to provide more opportunities for local experiences.

“All-inclusive properties and destinations are improving on their ability to offer a more unique experience. For example, locally sourced food and drinks to obtain the local experience while at the resort, while still providing a gastronomic experience that is amazing,” says Scaillet.

“Many all-inclusive properties are partnering with local DMCs to design destination experiences. It's not just about the resort anymore, but how much groups can interact with locals in the destination to maximise their experience.”

Destination appeal is the top criteria for selecting one destination over another followed by overall safety and value for money. Fam trips and hosted buyer meetings are the primary sources buyers use to learn about a destination.

Source:
CEI

Related Articles

Just Published

2 days ago

Asia-Pacific Power List 2024: Robin Liu, Miniso

Through strategic co-branding and localisation, Liu is steering Miniso towards global super-brand status with innovative marketing strategies and leveraging relevant IP.

2 days ago

Creative Minds: Koji Kanzaki on turning childhood ...

From aspiring comedian to comic fan and now creative director, Dentsu China’s ECD Koji Kanzaki loves uncovering beauty in the mundane, dreams of dining with Banksy, and keeps his inner child alive.

2 days ago

Wieden+Kennedy retreats from India, shuttering its ...

The agency's leadership in India including Ayesha Ghosh, Santosh Padhi and Shreekant Srinivasan have resigned.

2 days ago

Exit player zero: A creative director’s brush with ...

When a dream role at a gaming startup pulled in Robert Gaxiola, the veteran creative director and Playbook XP managing partner, quickly realised the cost to play was far too steep. Now, he’s urging fellow creatives to be wary of the same traps.