the real art of rewards

To you, or to me a reward is possibly a different thing and it’s something as an Incentive Practitioner we need to address constantly… what makes a real reward?

Let’s start with what it’s not! It’s not a random gift or prize – don’t get me wrong both of these have plenty of merit in their own right.

However, in a true Incentive a participant earns a reward for hard work, being a top achiever in their environment and reaching quantifiable, actionable milestones and measurements!

These rewards should be such that an individual aspires to and is willing to stretch and push towards in order to achieve.

It may be recognition amongst their peers

A tangible product that adds to their lifestyle

An experience which nurtures them or a money can’t buy group incentive trip!

But the key to all of this regardless of the form the reward comes in is that is directly linked to performance and that it creates a long term emotional connection!

And this is more important than ever in these tougher economic times with business analysing every dollar invested and the return.

In the internal employee space, well executed Rewards programs which have Reward choice and definable measurements will cost the business far less to retain happy, productive staff, then to have to re-hire and re-train. Especially when disengaged employees are looking elsewhere for that pay rise they haven’t received.

And in a Sales incentive program the rewards would be paid for by the performance of the sales person who stretches beyond their set targets or in a customer service program where individuals are rewarded for outstanding customer service performance and retains key customers….!

And clearly everybody is not motivated by the same drivers or the same rewards. There are demographics and personalities to consider. Consider that each generation responds to different motivators, as do males and females. Every reward should be flattering rather than patronising.   For example; someone who travels all the time won’t be excited by a long haul trip away from their family. These are all the things that need to be considered and this is where The Right Reward for the Right People concept must be followed!

Regardless of what form the reward takes… rewarding employees, sales staff and resellers is part of a sound business strategy with a real link to performance improvement!

Breakage in an Incentive/ Loyalty programme- good or bad?

There has been a lot of talk lately around Breakage in rewards programmes and whether it’s a good or bad thing.

I say… BAD!!

The basics of consumer loyalty programmes, reseller or internal incentives, is to reward participants for purchases, sales, or specified behaviours.

But what happens with people in the programme just don’t redeem their rewards?

Breakage.

Breakage means that there are left over points or gift cards that have been earned by a participant but they have not spent or redeemed.

When it comes to the rewarding of Points, you may get small breakage where a participant has spent majority of their Points, but have a few left over. Not so bad!

Or you get the more extreme instance, where a participant just doesn’t spend any of them. BAD!

The first question you ask is why would an individual not spend Points or gift cards that they have accumulated they’ve work hard to earn them after all?

If you as a participant are not engaged enough with the programme, you wouldn’t know;

1/ how many points you have

2/ how to earn rewards

3/ how to access them

4/ what you can spend on them!

And at the end of the day it means the programme just hasn’t worked!

Some companies have the view that left over points, or unredeemed points are profit and save money on the rewards programme.

We view this very differently, we want all Reward Points to be spent.. why?

Because it means it’s worked! Engagement is a very clear way to measure the success of a programme.

We want optimum engagement, minimum breakage and ultimately repeat usage, repeat patronage, repeat sales, repeat positive behaviours!

And this is driven through;

• Properly designed measurements that make the participation worth while… not a years worth of shopping to get a toaster!
• Correctly selected Rewards that are aspirational and worth knowing about!
• And, constant, engaging communication in the form that is right for participant!

Next time you think about designing a programme for your consumer, resellers and staff make sure that the ultimate goal is redemption!

Values Incentive Programmes – the how to!

A topic I find an interesting component of running a business is the communication of what we, as the Directors of the company,  view the core values of the business to be and what my team think they are.  With that in mind we are about to undergo an in-depth values and cultures workshop to work on just that!

It is without a doubt a simple enough concept – all individuals in an organisation are aligned, living and breathing corporate cultures and values! However reading this statistic that;

“40% of Australian workers are seriously considering leaving their organisation, which is up from 25% in 2003”. (according to Mercer’s new study, Inside Employees Minds – Navigating the new rules of Engagement).

We can see that in reality the alignment of the Top management of an organisation and it’s employees in these maters is often disparate.

And I know I’m not alone – in recent times I’ve sat through many workshops and inspiring talks on this mater for my own business but the proof is in the work with more of our clients creating Values Incentive programmes with us.

I believe it’s a reaction to the market place as we need to become more efficient within the team that we have – the cost of re-hiring, retraining and the bad influence unhappy employees have in your work place far outweighs the effort needed to keep great people!

What we do know is that the more aligned your employees are in the direction of the business – the more productive they will be, the less staff turnover / absenteeism you will experience.

Industry statistics show that “Incentives are effective at encouraging people to persist at more familiar tasks, averaging a 27% performance increase”.

In our experience here are some important elements to consider and put into practice when thinking about creating a values incentive programme (and it doesn’t matter if you are a small business or you have 10,000 + staff):

•  That the values are realistic. Like me, run workshops, think tanks with a broad selection of staff in your organisation to get a feel for the whether your values are rational in everyone’s environment.
• Once decided communicate and get buy-in! What the values are and what they really mean in actionable terms – have it everywhere- print it up in posters, put it on people’s screen savers on their computer, on your intranet, discussed in WIP meetings – EVERYWHERE! You have to cut through the clutter and make some noise.
•  Measurements – if you want to reward on employees ability to represent your values – set the structure and make it easy to measure on through employee and management nominations.
• Create and Emotional Impact –Happy people are known to exhibit higher engagement levels- it’s important that the programme you put in places creates an emotional impact- through it’s comms and rewards.
• Reward! It doesn’t have to be expensive – it can range from recognition, a bunch of flowers, a team reward, lunch with the CEO, a night out on the business – up to earning Reward Points which can be redeemed against a larger range of rewards and experiences and incentive travel. The key here is to know your demographic and provide choice!
• Support and Commit!  If you implement this type of programme you need to support it in every way – from the very top down and you need to deliver on your promises. If you are going to communicate every week, every 2nd week – then do it and do it well otherwise employees will disengage with the programme.
• Analyse and Learn– give it time to implement and become part of every day life and analyse it against your objectives and tweak where you need to…. Don’t just let it be a static programme that runs itself – make it work for your organisation.

I give you the challenge to look around your workplace and start the conversation… don’t be scared of the response – you may just be pleasantly surprised… or you will learn from the experience!

Why Incentives are important during tough times!

Marketing budgets are the first things to go in a tough market.

It’s seen as discretionary spend that doesn’t impact on the bottom line.

However… in our experience incentives have the best impact in a down turned market.

The old adage of spending money, to make money is relevant here- but it’s not about spending a huge amount of money!

 If your competitors have taken the approach of cutting incentives, motivational tools for their staff, sales people or loyalty tools for their customers. Eventually….. these individuals will go else where.

However- if you are actively talking, promoting, motivating these parties you will be in a far better position when the market swings around.

Just some of what you will be rewarded are;

• Increased Market Share

• Motivated and Engaged Staff = Less Staff Turnover

• Increased performance

• Repeat and happy Consumers

So why aren’t more companies using these initiatives during these times?

Where I think that businesses go wrong- is they think ‘we don’t have the budget we did last year, so why offer an incentive?’

And I understand it! However, in a business environment with staff, resellers, sales staff etc –  it’s more about how you manage the shift in rewards. The key is to communicate the changes.  If the reward / benefit is rudely removed you will actually inflame rather than motivate and end up doing more damage to morale, than if you had done nothing.

It is important firstly, to communicate that there has been a change and there are still opportunities for an individual to progress their career/ be rewarded for sales performance and most importantly be recognised for their achievement and value add to the company.  Your staff
will want to feel that there is security in their job and in the company.

Companies need to remember that with the change in the economy there is plenty of opportunity to focus on your staff, the key objectives of the business and take advantage over competitors market share and not loose the vision of the long term – if you remove incentives now you can do long term damage to your business.

In our experience, the kind of rewards that work best are based on a consistent reward over a period of time, they do not need to be expensive- often leading to the ultimate reward at the end.

Money is a great short terms accelerant however it is soon ploughed into the mortgage, spent quickly and absorbed by bills – you don’t want to put a value on their worth as an employees or a customer!

Incentive travel is the most highly prized reward of all.  The key is to include partners or loved ones to share the experience. So
if this type of reward is to be replaced your still need to keep with the philosophy of something that is a trophy for a staff member’s achievement that can be enjoyed or recognised with family and friends.

For example; an Incentive Travel Rewards programme – our B2B client has found that enrolled participants have performed 22% better in sales than non- enrolled.

Another Reward option that is forgotten quickly is Recognition…. Which costs time more than money. It doesn’t need to be sales driven, it can be service based, related to staff culture, best ideas, customer service performance,  managerial KPI’s on team performance, loyalty or just the happiest person during tough times who has lifted the team spirit.

I guess what I’m getting at- is that reducing a motivational or loyalty based programme during the tough times- will have an intrinsic effect on how we all recover!

How to get your incentive message through the information clutter!

Being a marketer something I am very passionate about is the right type of communication to deliver any message! And a common problem we all face is how to cut through the all the noise and information!  

Information and data is a fantastic asset in purchase decisions, research, information sourcing and entertainment – however is there such thing as too much information?

The article that cemented some thoughts I’ve had some time on this was ‘How to Survive Information Overload’.   

Basically, the University of London conducted a study for Hewlett-Packard and found that “infomania” — a term connected with addiction to email and texting — can lower your IQ! When you receive emails it can raise the levels of noradrenaline and dopamine in your brain by constantly introducing new stimuli into your day. When those levels get too high, complex thinking becomes more difficult, making it harder to make decisions and solve problems!

Now “informania” sounds a little crazy – however we all know that hours can be spent browsing data and stats, reading email blasts you signed up once upon a time ago, checking your 3 social and business media sites, browsing your favourite opinion blogs and keeping up to date with news! Often you pull your head up from your computer screen, eyes hurting, an hour lunch break turning into 3 hours of browsing and the feeling that you’ve run a marathon and your brains about to explode… how could you possibly do anything productive after that? Or retain the first of the 50 interesting stats that you read?

It is getting increasingly hard for marketers, bosses and managers to cut through the daily noise – so when incentive and loyalty programmes are based on creating engagement with an individual and driving them towards a goal it’s important to get the communication part right.

In an Incentive Programme you need to communicate the mechanics, the measurements and the rules– so when we design incentive and loyalty programmes for our clients we look at some general elements to work out how and how often to communicate, for example:

• Demographics
• Technology savvy-ness
• Work / Home environment
• Where they are most likely to engage with the programme
• And whom else is involved in driving their motivation (partners, friends, family members and children!)  

These are great to work out the medium of communication – print/ email / online/ SMS or mobile – but the key is finding a way to get the participants to make an emotional connection with the programme – and this is generally through making the REWARD the HERO!

Whether the Rewards are points that they can redeem against a choice to pick from a huge range merchandise or experiences or a single travel destination incentive experience… we want to bring that reward alive to them, in their environment and with their loved ones!

Once you’ve created a goal for them, a reward that they MUST have because it improves their lifestyle, then your letter, your email, your text message will always cut through because they will be biting at the bit to find out how they are doing in the programme towards THEIR ultimate goal!

Extend that little further and chuck some solid business and brand messaging in the mix and you have an open line of communication and back that up with some well communicated Sales Reps or Managers who constantly discuss and create further excitement around the reward – presto you have created engagement!

Don’t just take my word for it,… right now put yourself in a participants position.

You’ve been told my your boss that in 3 months if you don’t just perform and reach your targets but stretch across 4 KPI’s he will shout you and your partner an incentive experience. You go home and you tell your key influencer- your mates, your partner, your kids and they are all ecstatic about the opportunity – maybe even stick a photo up on the fridge of the resort you would stay at! You set yourself the goal and you are craving recieving that update so you can rush home and tell everyone how you’re progressing! 

Sounds simple right? But I know what a powerful tool incentives are to create an open line of communication and drive engagment and top achievement but I’m interested to hear about the communication techniques you have used to cut through the clutter in your environment!