INCENTIVES: Eyes on the prize - Rachel Miller looks at how technology is enabling businesses to tailor incentives more effectively

Money talks, but if you want consumers to part with their pounds or

if your sales staff are not hitting their targets, then the incentives

you need are vouchers, merchandise and holidays.

As marketers everywhere turn to their databases to find out what makes

their customers tick, so the incentives business is using sophisticated

techniques to profile and target recipients and to measure response.

’Incentive buyers are realising that there’s more out there than just

Marks & Spencer vouchers and they are looking closely at what will set

the end user alight,’ says Paul Hunter, marketing manager of Kingfisher

Vouchers. Companies are looking at ways they can make incentives more

creative and dress them up. Vouchers are also proving to be ideal for

monitoring the progress of an incentive programme every step of the

way.

’With vouchers, we can tell who is spending what and where. And because

we can track every voucher we can also tell how long it has been in

circulation,’ says Hunter. The average time that a voucher spends in

circulation is six weeks, with the majority being redeemed in the first

two weeks.

Memory loss

If recipients don’t bother to spend their voucher for a couple of

months, Hunter says, it can reveal their indifference and the danger is

that when they do use it they forget who gave it to them in the first

place.

Incentive providers who do their homework get to know the market first

so that they can tailor the incentive precisely. ’One way to target our

vouchers is to wrap them differently,’ explains Bill Brown, general

manager of Whitbread Leisure Vouchers. An incentive programme for

Vauxhall offered pounds 30 of Whitbread vouchers to everyone who took a

test drive.

’Whitbread vouchers can be redeemed at over 3000 outlets throughout the

UK, but we looked at the demographics and we focused on Beefeater

restaurants as the incentive that would appeal to the target audience.

And, despite the wide choice, 90% did spend it in Beefeater.’

Similarly, when sales staff at Churchill Insurance were asked what would

make a good incentive, vouchers were not an instant hit. However, the

staff jumped at the chance of a team night out at TGI Fridays, paid for

with Whitbread vouchers. ’It shows how the humble voucher can turn into

a spot-on reward,’ says Brown.

The process of researching the market for an incentive campaign, whether

it is aimed at consumers or staff, is being revolutionised by

technology.

From starting as a paper and telephone-based exercise, computers, the

Internet and voice recognition technology are now all playing an active

part.

’You can get responses much more quickly; it means you get answers

within hours rather than days. With staff, you have more control because

you can get into the IT function of the organisation to find out what

they want. With consumers, you have to put yourself into the marketplace

with a computer. Incentives is a part of the marketing mix that is

measurable. As computers speed up the measurement process, you can

fine-tune campaigns very easily,’ says Tim Williams, managing director

of incentives agency Aegis Carlson.

Nigel Cover, marketing director of agency Grass Roots, thinks the key to

targeting is to get people to pre-select what they want. This method can

inspire people and make it very much a personal approach.

Staff responses

However, he warns that simply focusing on the reward will not guarantee

the success of a campaign, especially when it comes to staff

incentives.

’People often focus on what you get at the end of the chain, but the key

questions for employers are what you want your staff to do and how they

are going to do it. It is a very sophisticated process and it is all

about good training and communication.’

One of the common pitfalls of any staff incentive programme is that a

high target helps to motivate only a few while demotivating everyone

else. ’At the end of the day, there can be as much to be gained from

moving the mass of the middle ground as there is by motivating the top

10%. You have to assess what levels can be reached and what skills the

employees need to get there. It is important to reward improvement as

well as absolute performance. It is also vital to show how the targets

can be achieved, otherwise it can be very demotivational,’ says

Cover.

Grass Roots offers the full gamut of rewards, from its own vouchers,

called BonusBonds, to merchandise and holidays. It finds that vouchers

tend to be more popular at the lower end of the scale: less than pounds

150.

Next comes merchandise such as TVs and camcorders and then all the way

up to personal and group travel.

Choice is certainly at the heart of an ambitious programme of incentives

being offered by Cable & Wireless Communications to its residential

sales staff.

’This is the most comprehensive sales incentives programme in the

country,’ claims Lynda Timson, the head of programme management at the

consumer business unit of Cable & Wireless. ’We have 1000 sales people

aged between 21 and 55, and their lifestyles are so different,’ she

says.

As a result, Timson has developed a range of incentive schemes which

operate monthly, quarterly and annually, from Rev Up The Volume, which

is based on a scratchcard mechanism that pays out in Kingfisher

Vouchers, to campaigns that offer cars and holidays as the star

prizes.

’You have to look at the salesforce objectives and the methods of making

the sale and then motivate them out of the comfort zone,’ she says. ’I

look at the commission plans and see where money is not always a

motivational tool. If they feel they are earning enough, they have a

nice car, and a great house, then how do you get them to want more?’ The

answer, she says, is to ’appeal to their luxury button’.

Dream destinations

That luxury is mainly provided by travel incentives in the shape of the

Around the World in 90 Days campaign. ’Every quarter, staff collect Air

Miles and if they have collected enough, they can choose from five

different destinations. So they have the chance to win a holiday every

quarter and this has a very strong appeal,’ says Timson.

The high fliers, meanwhile, set their sights on the annual programme,

The Inner Circle, which offers the top sales staff the chance of a dream

holiday to a destination such as the Seychelles. The whole campaign has

been successful, with a sales performance increase of 49% and staff

retention figures that are higher than industry averages.

It seems that the incentive industry is likely to see an increasing

number of well-targeted and sophisticated programmes like this. In the

past, businesses took a fairly short-term approach to incentives,

dipping in and out of campaigns from one year to the next.

But this is changing, says Cover. ’Motivation is not a quick exercise;

it has to be integral and continuous. You can change behaviour in the

short term but then people revert to habit. The trick is to change the

habit.’

This article was first published on Marketing