Incentives Industry Optimism On The Upswing
Incentive program budgets are expected to increase by 34 percent in 2022, says a recent study by the Incentive Research Foundation (IRF), with merchandise increasing 30 percent and gift cards by 34 percent. The study, Industry Outlook for 2022: Merchandise, Gift Cards and Event Gifting, also found relatively optimistic expectations among incentives industry professionals were tempered only somewhat by the lingering effects of COVID-19 cancellations and uncertainty in 2021. And for the first time ever, the IRF expanded its study to include European participants.
“It’s exciting to see both the similarities and differences between the North American and European markets. For both North America and Europe, 78 percent of respondents reported that they expect their company to have strong financial performance in 2022,” says Stephanie Harris, IRF president. “When we drill down into how gift cards, merchandise and event gifting are being used, we see some very different trends in Europe compared to North America.”
Tracking key metrics over 12 years, the study provides trends in economic optimism, budgets and award types for incentive programs. For its latest iteration, the IRF surveyed 481 industry professionals, with 275 in North America and 206 in Europe.
The study highlighted an increase in budgets and spending, reporting that per-person spending increased to $806 from $764. It also reports that optimism is on the upswing, as 63 percent of North American respondents believe the U.S. economic outlook is strong for 2022, compared to only 50 percent going into 2021. However, cancellation rates also increased—merchandise and gift card program cancellations rose from 29 percent in 2020 to 44 percent in 2021.
Comparing European and North American respondents’ answers, the IRF found that North Americans place a higher emphasis on logoed brand merchandise, while Europeans are more likely to give office accessories as a gift. Also, Europeans are more likely to give gift cards for accessories, jewelry, beauty products, travel and groceries, and North Americans are more likely to give “big box” retailer and coffee shop gift cards.
To download the full "Industry Outlook for 2022: Merchandise, Gift Cards and Event Gifting" report, click here.