High-Value, High-Impact Incentives & Rewards
By Emily Tipping
At the height of the recession as consumers of luxury goods aimed to be less conspicuous, it was not unusual to find someone walking down 5th Avenue in New York City with a luxurious item encased in a brown paper bag. While the world reeled in the wake of an economic downturn of near-disastrous proportions, those with the funds to spend on high-value brands and coveted items were less likely to showcase that spending. Flashy diamond-encrusted watches gave way to traditional, classic styles.
Bling was out. Saving was in.
But while luxury goods worldwide took a severe hit in 2009, ending a year of sales declines totaling 8 percent, according to Bain & Company, a New York-based global consulting firm, the market was expected to show a recovery in 2010, rising 10 percent and nearly eclipsing its historical peak, which came in 2007. This market rebound was linked by Bain to rapid increases that came in the second and third quarter, as well as consumers returning to brands' direct-owned stores, growth in China and a rebound of sales in the United States. The market was particularly strong for sales of leather, shoes and accessories, Bain reported. The group expects sales to continue to climb in 2011.
For professionals working on programs to reward and motivate their employees, partners and customers, this means that attention must be given to the types of items included as part of those reward and award mixes. If you don't offer people the chance to earn a little luxury, if you don't include aspirational items that most people would never purchase with the dollars in their own pockets, your program will not reach its full potential.
When it comes to incentives, rewards, recognition, service awards, business gifts—you name it—well-known, brand-name luxury items are your ticket to success.