by Leo Jakobson | July 02, 2018
The Incentive Research Foundation has released its first Voice of the Market study based on interviews from 50 corporate end users about their incentive, recognition and reward programs. 

"Voice of the Market, Part 1: The Use of Non-Cash Rewards & Recognition" looks at and enumerates the elements that make up a successful incentive program, based on the opinions of professionals running them in the field. The interviewees represented programs with budgets ranging from $25,000 to several million dollars that used at least one of the following award types: travel, award points, merchandise, gift cards and branded items.

"The great news is that end-users are strong believers in the merits of non-cash rewards, and just as important, they report this positive sentiment is broadly shared among their executive teams," said Melissa Van Dyke, president of the IRF. "We gathered so much insightful information from this series of interviews with end-users." The study was sponsored by MCI USA.

Among the findings are that non-cash awards are viewed as complementing cash incentive programs, which are seen as a form of compensation. Non-cash reward programs, by contrast, are seen as "vehicles of celebration" the report says, noting that they are "fun, memorable and more easily discussed socially than cash."

In fact, while incentive professionals tend to believe that convincing corporate executives and incentive programs owners that non-cash awards are superior to cash is an uphill battle, the executives interviewed viewed cash as serving "a completely different purpose for the organization," than non-cash rewards, the report finds. "Cash is very firmly viewed as compensation, the baseline component of an ongoing business arrangement between the firm and the employee. As the foundation of the employment agreement, cash is a tablestake."

Another finding that surprised the IRF was "the degree to which program owners report they enjoy fulfilling the rewards for their programs," the study said. "While incentives industry providers offer to relieve program owners of the administrative burden of managing rewards issuance, administering the rewards is very often the highlight of the program manager's job. Considering what rewards will be exciting and fun for participants is a break from the day-to-day grind -- for many, this is the most fun they have at the office … Even laborious tasks, such as arranging an incentive travel package are viewed as an enjoyable experience."

A finding that is perhaps not so surprising is that corporate incentive programs tend to be decentralized across branches, facilities and business units, with minimal coordination or sharing of best practices. 

The full report has a great deal more insight, notably into how merchandise, gift cards, travel and other types of awards are used, managed and viewed. 

Overall, part 1 of the Voice of the Marketplace study finds the owners and managers of non-cash incentive, reward and recognition programs to be strong and confident advocates of their programs. In July, the IRF plans to release Part 2 of this study, looking at "how new buyers learn about and engage with the incentives marketplace, and how the industry can more effectively engage and partner with program owners."