Corporate Incentive Travel - 3 Reasons Why Shrinks Say It's Better Than Cash

Corporate Incentive Travel

3 Reasons Why Shrinks Say It’s Better Than Cash

Corey Trueman, Director Corporate [email protected]

So you’re looking to motivate a team,

reward them for a job well done,

or motivate them to hit a new quota…

What’s the best way?

Easiest way…

Employee = Dollar Amount = Reward

Right?

Wrong.

According to recent studies inbehavioral economics andhuman psychology

Smart dudeslike this guy

Here’s three reasons why an incentive travel experienceis better than just cash.

Reason 1People Don’t Like To

Feel Guilty AboutSpending Money

People experience a "pain of paying," which lowers your excitement at time of purchase. - Drazen Prelec and George Loewenstein, behavioral economists

So that $500 bonus David was looking forward to spending…

doesn’t actually FEEL so good when he gets to the store to use it on that new jacket.

This leads to a guilt factor which lowers the motivation to spend.

In studies where thousands of people had to choose between a luxury item (trip, jewelry, electronics, ect) and cash of equal or greater value…

a large part of the group (between 13% and 39%)chose the luxury itemover cash

"If I went with the cash, I’d spend it on something I really need

instead of something I ENJOY.”

- Respondent

“Now I can pamper myselfand not have to

spend the cash on groceries.”

- Respondent

Here’s the point:

If you don’t make your incentive program relevant and MOTIVATING, like using a travel incentive experience…

Your $500 bonus to your sales star David for hitting quota just ended up being spent on pizza, beer and cereal.

And this leads to the 2nd reason why incentive trips are better than cash…

Reason 2Cash Is Quickly

Forgotten

"How did you spend your last cash reward?"

Didn't rememberNever got a bonusBought giftHome itemSaved it

Source: Wirthlin Worldwide Research

Huh?This is a BIG reason why most cash incentive pale in comparison totravel incentive programs.

Your team WILL remember a week at the beach, under the sun, sipping a Pina Colada…

or even a nice weekend retreat with the spouse at one of the local 5 star properties.

Here’s the takeaway:

Remember David’s $500 cash bonus you were going to give him?

Instead, you could have taken that $500 and paid for a weekend stay at a nice 5 star hotel locally.

Crank it up a notch to $1000 - $5000 bonus, and you could send him and his whole family to the Caribbean for a week for an all inclusive resort.

The memories, pictures on his cubicle walls, Facebook posts, will last much longer than last weeks groceries.

Whenever he talks about that trip, he’ll remember exactly WHY he was there (because he’s a sales rock star)

…and WHO sent him(the company he’s now more loyal to… yours).

And this brings us to our LAST reason why Incentive travel is better than cash…

Reason 3People Will WorkHarder For Travel

Ran Kivetz, the Sidney Taurel Associate Professor of Marketing at Columbia University Graduate School of Business recently revealed something fascinating about human psychology and motivation…

People are wired to commit in advance to a luxury item, like a business incentive travel program, more so than a necessity – like groceries – when the conditions to get the reward are increased.

This means that if you raise the quota, your team is more likely to WANT to hit it if the reward is a non-essential payout(i.e, something instead of cash,like an incentive trip)

In two different studies people were given the choice between a program with a one hour facial or massage with a retail value of $70, or they could join a program that gave them a $70 gift certificate to a local grocery store.

Regardless of the study, when the requirements to get the reward were LOW, a higher percentage of people opted for the grocery certificate program.

“I don’t have to work hard for this”

When the requirements were a little tougher, they shifted to the luxury offer rather than the groceries.

“I’ll put in a littleovertime to get this!”

So here’s the final takeway:

If you want mediocre response and lackluster effort to hit a new quota, throw cash around.

But if you want to get some REAL deals in the door, use that same money and make it an incentive travel experience.

For more free ideas download a free copy of the special report…

Download it here“This report savedus at least $2000.”- T. Morris, Cleveland, OH