Industry Insights: Why Incentive Programs Have Proven Results
Over the past 30 years, HMI has witnessed significant changes in the incentive industry. Years ago companies conducted incentive travel programs as a means to recognize top salespeople and customers, many times being content with retaining their performance levels. Little focus was given to the ROI of a program or using a strategy as a means to acquire new customers.
About 15 years ago, the industry began to evolve to more of a performance-orientation with clients identifying specific program objectives. HMI responded with resources to help in structuring programs to achieve definable goals.
As companies become more focused on target marketing initiatives and embrace the need to market to their existing customers, the performance incentive industry, and HMI, has responded with enhanced resources to help clients capitalize on the growth potential inherent in their customer base.
Performance incentive strategies are a nuanced approach to behavioral modification of customers. Customers will only purchase quality products from quality companies that are easy to do business with and offer cost-effective products. Given that many companies feel that they meet these criteria, it then becomes incumbent upon companies to answer the WIIFM for their customers and prospects. Performance incentive strategies help address this by targeting resources to opt-in participants who effectively say “yes I am interested in learning more about your company and yes, I am interested in doing more business with your company.” This self-identification process enables companies, and their sales organizations, to identify high potential opportunities.
As the industry looks forward, keys to supporting client success include:
- Expertise in understanding distribution channels and issues.
- Providing the resources necessary to assist clients in structuring programs and developing pre-program performance projections.
- Target marketing communications initiatives utilizing multiple mediums. People process information differently and it is critical that all communications methodologies be utilized to reinforce the company and program message.
- Vesting the client’s sales organization in the strategy, either through communications, reporting, rewards or compensation methods.
- Easy to use administrative systems that are supported by robust analysis tools. Capturing data is nice, but converting it into actionable information is critical to identifying opportunities.
- Offering rewards alternatives that cater to participants’ interests.
But most importantly, people still do business with people. Every client is unique and every opportunity is different. Flexibility, creativity and a commitment to service are hallmarks of what differentiate companies and provide the foundation for creating a competitive advantage and driving growth.
Vice President, Sales & Marketing