The Incentive Industry Reports A Positive Outlook For 2019
The incentive industry’s outlook is largely optimistic as 2018 draws to a close and it looks to the year ahead. The Incentive Research Foundation’s (IRF) Industry Outlook for 2019: Merchandise, Gift Card, and Event Gifting found that for Fall 2018, the IRF’s net optimism index for incentive merchandise and gift card programs was 43 percent, up 21 percent from Summer 2017.
The study found that for Fall 2018, the IRF’s net optimism index for incentive merchandise and gift card programs was 43 percent, up 21 percent from Summer 2017. Among those surveyed, suppliers were the most optimistic segment. Industry stakeholders also had very strong expectations for 2019, with 84 percent reporting they anticipate their companies experiencing strong financial performance.
“The IRF’s Industry Outlook for 2019: Merchandise, Gift Card, and Event Gifting reports strong optimism around non-cash reward and recognition budgets in 2019, with increases in merchandise spend, gift card spend and the number of participants earning a reward,” says Melissa Van Dyke, IRF president. “The study did reveal some areas of concern for program owners, such as the fact that one half of corporate respondents do not do any reporting or analysis of their non-cash programs.”
Per-person spend is increasing. The IRF reports the average per-person spend is $824, a considerable increase from prior years. This is largely explained by the increase in respondents spending more than $5,000.
The survey also found that average merchandise reward value is $160, with logoed, brand-name merchandise and electronics as the most common rewards with corporate respondents, while sunglasses and electronics are the most popular among third-party providers. Among branded gift cards, the average reward value was $100, with gift cards for use at coffee houses dominating the branded card landscape, followed by dining and online retailer gift cards. Average per-attendee event gifting spending in the survey was $210. While suppliers see event gifting across a broad range of meeting types, corporate audiences were most likely to use gifts for incentive trips, internal meetings and customer events.
Low rates of corporate reporting and analysis were also identified in the survey, with one half of corporate respondents indicating an absence of reporting or analysis for their non-cash programs. Third-party providers are commonly reviewing earning and redemption reports, participation reports and behavior-change analysis. When analysis is done, sales productivity was reported by both corporate and third-party respondents as the lead indicator of the impact of a program.