Feature Article - November/December 2018

Right the First Time

Avoid Common Mistakes in Incentive Program Planning

By Rick Dandes

Understand Your Audience

Anything that will make the end recipient of the incentive, rewards or recognition program unhappy is a mistake, said Eric Thiegs, president, National Gift Card, Crystal Lake, Ill. "That's easy to say, but what does it mean? How do the end program users get unhappy?" The answer is simple, he said. "There are four things that make recipients unhappy: They didn't get the correct reward that they ordered; the award didn't arrive fast enough; the reward was not securely delivered; or the reward carried a perceived value less than the currency used to secure the award, whether that be points, miles, cash-back, tenure or action-based behavior."

This is why incentive houses must ensure processes are in place to send the right product in the right affinity packaging to right person as quickly and securely as possible, Thiegs said. "If you keep the end users happy with speed, quality and security, you've tackled the biggest pain points of our industry."

Fraud is also something to watch for, said Paul Hubert, vice president of IT and operations at GC Incentives, Omaha, Neb. "From our position in the market, fraud is a big concern of customers in programs, and that's because you still have people buying gift cards or prepaid cards and putting them in a drawer to hand out for all types of program rewards. In those situations, there is lack of accountability, and procurement desires to solve for the lack of centralized control that exists."

Anything that will make the end recipient of the incentive, rewards or recognition program unhappy is a mistake.

Other things that can go wrong include not considering your audience when choosing awards. In other words, making sure there is choice that is robust and of high value to appeal to all demographics and award amounts, and thinking through reward delivery logistics of rewards tied to events.

"There can be too much time and money focused on 'the system,' and this takes the focus off people and behaviors," Hubert said. "They identify with the system and not the program itself. We often see RFPs for a scoped solution that is way beyond what some companies need. And we've seen clients that have a robust platform when all they needed was a simple solution that would integrate with a system they already have. After implementing a new platform, they realize down the road it is too complicated and not used to the level of investment."

"Our SuperCertificate and GiftPass solution helps curtail fraud," Hubert said. "We have a system that allows creation of multi-member accounts that enables authorized individuals at companies to purchase using a purchasing card and gives reporting around the purchases as a record of what was purchased, who it was given to and who it was given from. Our certificates can be cancelled and reissued if lost or stolen, and if it is fraudulently used, we can often stop the redemption of the certificate before a gift card is sent out."

You don't have to have gift cards in a drawer, he said. You can order certificates and they are sent within minutes. And the recipient can get what they want from a selection of hundreds of gift card brands, which solves the challenge of providing enough choice.

Suggested Solutions & Best Practices

The simple answer to avoiding mistakes is planning, Donnelly said. "Spend time thinking about your participants. Ask yourself these questions: What can I do to make sure that my people learn about the program, and what can they do early on to show they are engaged? How can I keep the program top-of-mind with my people? How can I use the program to create heroes in my company and promote those heroes to others? And what metrics can I use to see if the program is working as we need it to? Are there leading indicators I can be tracking to help me see if the program is on track? If you can't answer these questions, there are probably some adjustments you need to make to your program."

Define your objectives, strategy and ROI, Ozer said. "Make sure the first thing you do when planning a program is to define the business objectives, make sure the strategy aligns with those objectives, and project ROI scenarios based on different levels of engagement," he explained.

Sometimes companies run various types of incentive or recognition programs because they want to do something, versus thoroughly assessing the objectives, best strategy and planning for the return, Ozer said. "Focus on the program results," he said. "When planning the program, the primary focus should be on the results and all of the services necessary to achieve them, including program communications, technology to track and report performance, training, and ROI assessment and analysis. The awards selection and cost are just one component and usually not the most important one."

"Develop a communications plan for your program to include goals, a theme and a variety of media using a consistent theme to keep things fresh and top of mind," Hubert said. "If possible, send awards with a communication that includes the theme and reinforces reasons for the reward. With today's innovations, you can create or add a game with complexity. At GC, we have fun games and even the ability to add video to reward communication at a low cost and fast turnaround."

Understand your participants, said LaSalvia. "The first key in offering rewards that appeal to your audience is understanding what's popular," LaSalvia said. "Redemption trends tend to mirror retail trends, so it's important to offer program participants the items that are top of mind for today's consumer."

After that, organizations should align themselves with a partner who has the technology to produce a competitive recognition and rewards platform. It should deliver participants a seamless and immersive rewards experience, while offering a wide variety of today's most in-demand merchandise from the most popular brands. Understand what's important to your audience, give them access to an easy-to-use rewards platform and select rewards that meet their specific wants and needs. Only then will your program be successful.