2015 Incentive Industry Research Findings

Program Design & Support Series:

4. Engaging Outside Program Support

Data reported here includes survey results from our2015 national sampling of reward and recognition "end users” of sales, channel, and employee programs. Additional papers in this series include the following:

  • Program Goals & Objectives
  • Communications, Technology, Tools & Reporting
  • Award Program Spending

To gauge how incentive programs are procured by end-using companies, we asked research respondents about their use of outside suppliers, whether they work with single or multiple vendors, the types of vendors/suppliers they work with, etc. The following provides these and more details about program procurement. 

Use of Suppliers By Program Type

As expected, the highest use of suppliers is for sourcing of merchandise, gift cards, and travel rewards. For non-reward support, Sales Channel programs have the highest incidence of relying on suppliers for expertise, design, and program administration, while Employee programs showthe lowest incidence of using outside support for these activities.

Single Vs. Multiple Suppliers

Multiple suppliers are often used to support Sales and Employee programs. Conversely, nearly half of Channel programs are supported by a single supplier.

About The End-User Survey

Audience:

Reward and recognition “end-users” in firms with annual revenue of $1 million or more. The following shows final survey distribution of respondents who had some level of responsibility for non-cash programs for their salespeople, for channel/dealer partners (the end-user company’s distribution channel), or for their employees.

Confidence Level:

The sample size provides a 95% confidence level and 6.4% margin of error (i.e., if the study was completed 100 times, 95% of the studies would generate results within 6.4% of the current study).

Single Vs. Multiple Supplier By Firm Size

The use of single vs. multiple suppliers varies according to the size of the firm:

Sale Programs:

For Sales programs, larger companies use multiple suppliers more often than the smallest companies do. Only a quarter of larger firms use a single supplier for program support.

Channel Programs:

Similar to Sales programs, Channel programs in large firms show a higher incidence of multiple suppliers than do small companies.

Employee Programs:

Unlike Sales and Channel programs, Employee programs show a consistently high incidence of multiple suppliers across all company sizes. For all firm size categories, only a quarter to a third of companies use a single supplier.

 

Types of Suppliers Engaged By Program Type


Sales Programs:

For Sales program support, there is a strong presence of full-service reward and recognition providers, gift card providers, and merchandise providers.

Channel Programs:

Within Channel programs there is a strong reliance on merchandise reward providers and, to a lesser extent, gift card suppliers.

Employee Programs:

The opposite is seen in Employee programs, where gift card suppliers have the highest incidence followed by merchandise providers.

Sourcing For Merchanise & Gift Cards

Among companies using merchandise or gift cards for their programs, a majority source those rewards from local retailers. The next most-prevalent sourceis incentives-industry companies, followed by the corporate B2B sales team for retailers or merchandisers.

 

Merchanise & Gift Card Sourcing By Firm Size

The reliance on local retailers for merchandise and gift cards is highest among smaller rms, dropping dramatically for companies over $1 billionin revenues. The largest rms use suppliers in the incentives industry or go directly to corporate B2B retail/merchandise sales teams.

Rewards Sourcing By Total (Cross-Audience) Spend

How Merchandise and Gift Cards Are Sourced

Companies using incentive industry and corporate B2B suppliers have many options available to them in terms of how they source their awards.

A majority are working through an account manager or customer servicere presentative, and half are ordering online.

Approximately one-third bulk-order rewards and a third opt for fulllment upon participant order.

2015 Incentive Industry Research Findings

Merchanise & Gift Card Sourcing By Firm Size

How companies order from incentive industry and corporate B2B suppliers diers by size of firm. The smallest rms are most likely to be working through a service representative, while mid-sized companies ($10 to 99 million) predominantly order online.


Rewards Ordering By Total Cross-Audience

Firms with higher cross-audience spend are more likely to engage an account manager or CSR in their ordering process. Additionally,higher-spending rms are more likely to fulll rewards as participants earn and order them.

 

For additional papers within this series, or for more informationabout the Incentive Federation, please visit: www.incentivefederation.org