The Experience of Winning
Creating an Effective Reward Experience
By Joe Bush
Incentive marketing industry folks have long known that people are motivated by more than money and merchandise.
Psychological and behavioral studies show time and again that the most successful incentive programs are never as simple as just providing rewards for performance. According to a Governance Studies at Brookings report, millennials will comprise more than one of three adult Americans by 2020, and 75% of the workforce by 2025, and according to a study done by JWT Worldwide, 72% of millennials would rather spend money on experiences than products.
It follows logically that if experience is so important to the now and future workforce's cash outlay, then experience is crucial to the way they select, receive and use what they buy (or redeem rewards for). Like any great business practice, it's not just the employee who gains from the reward experience being top-notch.
A 2018 white paper from the Incentive Research Foundation (IRF) titled Establishing the Intangible, Non-Financial Value of Rewards Programs states that "many of the cultural conditions driving an organization's intangible value stem from incentives, rewards and recognition. The growing use of 'total rewards' reflects greater organizational awareness that compensation, benefits, incentives and rewards extend far beyond traditional definitions."
Reward and recognition professionals, whether they are designing programs or providing travel, experiential rewards or tangible rewards, should consider redefining what they do and what a reward is, says the paper. Many studies cited by the paper find that "high-performing organizations understand that it is a company's broad mix of tangible and intangible rewards that create the conditions that set them apart from the competition."
The paper suggests that reward and recognition programs should strive to build what behavioral economics expert Dan Ariely refers to as a social relationship between the employee and employer.
"Building relationships and social connections leads to better citizenship behavior, creating a reciprocal desire to return the organization's generosity with greater effort, loyalty, information-sharing and advocacy such as speaking well of the firm to others," said the paper.
Personalization then is elementary to establishing that connection. Employees prefer a wealth of choices and customized prizes. Cash means more to some, less to others. Humans love being recognized by their peers and bosses, either in small or large settings, so that for many, a one-on-one lunch with an executive is more attractive than a gift card.
But showing the workforce how important it is to a company goes beyond the types and number of rewards; the process of incentive programming should be prioritized so that those who claim winnings don't regret winning. The experience of victory includes not just the claiming of the rewards, but also the way a contest is executed, the announcement of the winners, the ordering and delivery of merchandise or the entire travel journey.
Details mean a lot.