Referral Incentives - To develop contacts or
promote referrals."Refer three new customers to our Health & Spa Club and we will give you a free cruise to the Bahamas or Mexico."
obtain money upfront."Pre-pay a one year service agreement, you will get a free 8 days and 7 nights condo accommodation in the destination of your choice."
ships."Join our golf club now and we will send you and a companion to Las Vegas with airfare and hotel all for free!"
"We will send you and a companion to a free vacation for 3 days/2 nights in over 30 destinations when you open a checking or savings account with us."
"Send back our questionnaire, we will send you and a companion to Orlando near Disney with free hotel and airfare!"
"We will give you a free 3 day/2 night vacation to Orlando when you test drive our all new 2002 Honda Hybrid."
Cash vs. Travel?
Cash as a motivator is considered an unemotional award. According to an article in September 1995 Potentials in Marketing, it seems that all human behavior stems from one of the brain’s two hemispheres: the left, which thinks in rational, linear terms; or the right, which operates in terms of images, emotions, and feelings. When companies offer money as a motivator, they are addressing performance issues from a rational, left-brain point of view. Tangible rewards, however, areoften more motivating because they appeal to the right brain eliciting images. (Copyright IMA)On a survey conducted by the Wirthlin Worldwide Research, a question “How did you spend your last cash reward?” was asked.
The following results were gathered:
29% - Bills
18% - Don’t remember
15% - Never received cash
11% - Gifts for family
11% - Household items
11% - SavingsThough its value is concrete and while it could be used to purchase a lifestyle award, mostly likely cash will be charged against a pile of bills or deposited into a leaky checking account where it soon ceases to exist. And with the demise of the cash award goes the memory of its origin.
Joe Devlin of Mitsubishi Fusco Truck of America Inc. quoted, “Cash goes straight into people’s pockets, and they need it to supplement their salary, but our trips give us the competitive edge. They’re a big part of how we motivate the salesperson at the dealership who has the opportunity to sell more than one product.” (Incentive Travel Fact Book)
In 1994, Goodyear Tire & Rubber Company sponsored an incentive campaign to improve sales of tires. Two groups were formed; one was offered monetary rewards, and the other an equivalently priced selection of merchandise and travel –related rewards. The group receiving lifestyle and travel rewards outperformed the monetary rewards group by nearly 50%. This was the first documented evidence that cash, as a motivator, is not as effective as travel or merchandise. (Copyright IMA)
Using non-cash incentives such as travel will distinguish a company’s campaign from cash compensation packages. The programs do not become an expected part of an employee’s income. Surveys by Incentive Federation show that organizations use incentive travel because it creates lasting memories for the participants and generates positive buzz throughout the organization. Because they do not have an impact on compensation, it’s easier to use incentives as needed without creating the impression that people are getting pay cuts when no program is in gear. (Copyright IPC)
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