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Does Incentive Travel Improve Sales Productivity?
This is a groundbreaking study originally published in 1998 involving research into the effectiveness of incentive travel at a leading insurance company in Great Britain. The company allowed researchers to confidentially dissect the implementation and impact of its incentive program in exchange for anonymity.
Overall, the study findings reveal that incentive travel has a positive impact on performance, but that better understanding of program dynamics can yield even better results.
On the positive side, the study found that the incentive travel program motivates the top performers based on surveys of participating managers and sales people eligible for the program. The study, conducted by the Luton Business School, also found a correlation between the launch of a program and an increased rate of sales increases, and found that winners generally had a positive attitude toward the program.
On the other hand, new and less senior salespeople expressed less enthusiasm for the program, especially because the design allowed only for the best performers to participate in the travel event, rather than a tiered event allowing room for mid -level performers who significantly increase their performance. A fundamental of professional incentive program planning focuses on the “middle 60 percent” of performers, yet, Federation research indicates that many incentive programs focus primarily on the top 20 percent of people who would win anyway.
The Foundation is indebted to this leading insurance company and Incentive Company that had the courage and trust to subject itself to this analysis, which significantly contributes to the body of literature analyzing the use of incentive travel in actual practice rather than in theory.
These findings apply only to the cooperating company and may not apply to other organizations. Further usage of the measurement tool will provide the basis for developing such generalizations. Cost data on incentive programs besides a convention cruise travel incentive were not provided to the research team. Therefore, it is not possible to conclude whether one incentive program is more cost-effective than another or, whether or not the total program provides a favorable cost/benefit result.
The analysis does show that incentive programs can be approached in a more managerial way. For example, for this organization, it appears that a focused, more targeted approach, might lead to more consistently high performance levels by sales agents and incentive programs which can lead to profitable, incremental business.
Does incentive travel really work?
The University Of Luton Business School was approached by The Incentive Research Foundation in June, 1997 to investigate the commercial value of incentive travel within a “live” business environment. It was felt that the best way to discover the answer would be to examine an experienced, existing user of incentive travel.
Through Page & Moy Marketing, we were able to obtain access to a major UK bancassurer with a sales force of approximately 1,000 employed managers and sales people. By chance, the corporate client had canvassed the opinion of their sales force in 1992 about their traditional twice -a-year travel events. This research was made available so we can examine attitudes in 1992 and attitudes after the introduction of a “Club” program, together with the effect on sales productivity. The Club program has now been in force for four years (1994-1997).
The following provides details on the effectiveness of this company’s incentive travel program.