Most research suggests that non-cash rewards can be much stronger channel motivators than cash bonuses. A study was conducted by the Aberdeen Group and distributed by the Incentive Research Foundation demonstrating that best-in-class firms are much less likely to focus solely on financial incentives than they were just a year ago.
The study drew from responses from 245 B2B sales professionals and found that 63% of best-in-class companies believed non-cash rewards were important.
There are a whole host of different things that make B2B professionals – VARs, distributors, marketers – feel successful and fulfilled, and financial stability is just one of them. Social standing, fun, relationships and peace-of-mind, are all important facets of overall wellbeing, and can be targeted more acutely by non-monetary rewards.
You need to wedge your feet into your channels’ shoes and find out what really drives their self-esteem and satisfaction and then position your reward offerings to illicit those responses. Cap Gimini’s research found that only 11% of loyalty programs offer personalized rewards based on history and location data.
One simple way of getting partner insights is by soliciting feedback from your program participants. Send out questionnaires and surveys asking them about their interests, needs, desires, families, recreations and much more. Then sit down with a group of your finest colleagues and brainstorm the gifts and rewards that are most expertly tailored to their characteristics.
Trophy style rewards have a powerful psychological pull because they draw up an image in participants’ minds. That image will keep appearing throughout their daily working lives, enticing them and driving them to work harder towards their goal.
Trophy rewards don’t always have to be whopping big gifts – they can range from a Starbucks gift card to book vouchers, theatre tickets, a HD TV or an all-expenses paid holiday.
Experiences like shopping sprees, or holidays, are often a good call because people are motivated by the promise of moments that will enrich their day to day lives. These experiences can also be shared with spouses, friends and loved ones and this kind of social enrichment is valued very highly.
If you translated trophy gift money into cash you’ll see that it really doesn’t have the same pull factor. I mean, who’s going to get excited about $30 or even $100? – it lacks the glitz and glamour of a theatre trip or TV. If you were to ask program participants how much they made from an incentive program last year they’d be unlikely to recall an exact monetary figure – they’d just have a vague feeling it was “quite a bit”. But it you were to ask them about a spa vacation or golfing holiday they received as a reward three years ago, they’d be likely to remember every fun-filled moment.
Rewards can largely be organized into a few different broad categories.
Recognition awards: perks to recognize participants such as time off work, parking spots, free lunches, etc. These can include simple ‘thank yous’
Recognition events: gatherings, recognition ceremonies, meetings or awards. E.g. ‘employee of the month’ for brand compliance
Symbolic awards: Plaques and trophies
Merchandise awards: any type of good or product
Group Incentive Trips: travel experiences e.g. place on a group trip or selecting from various travel packages. Can include hospitality, gifts and entertainment during the trip.
Just so you get a sense of what’s out there in the B2B channel program space, according to Incentive Federation, popularity of each reward category is as follows:
Or just show them the money?
When asked, front-line channel partners invariably express a desire for cash rewards, as opposed to trips, book vouchers and other such treats. There is debate in the incentive industry about the effectiveness of cash versus creative alternatives, but sometimes in the end it’s good to bow to the voices of the masses.
Studies have also shown that when it comes to money, delay discounting is much less likely to take place. The money maintains its enticing and pristine glamor regardless of delays and redemption difficulties. To find out more about delay discounting, read our blog post on the subject!