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2013 Canadian Incentive Trends Survey: Use of Corporate Incentive and Rewards Programs Climbs in Canada

August 1, 2013 Corporate No Comments Email Email

The use of corporate incentive and reward programs in Canada jumped in 2013, with Canadian organizations increasingly using incentives to gain a competitive advantage, according to the 2013 Canadian Incentive Trends Survey.

The study also revealed that while program budget is still the most important consideration when offering incentives, recipient satisfaction is growing as a key measure of program success. The research also showed that prepaid Visa, MasterCard and American Express corporate incentive cards continue to grow in preference over traditional branded merchandise and gift cards.

Three-quarters (75.3%) of the organizations polled for the 2013 Canadian Incentive Trends Survey said they used incentives to motivate and reward employees, customers and channel partners in 2013 – up 10.3% from 2012 (65%). Of those surveyed, 62.4% said “they did indeed get a leg up on the competition” through their incentive programs, up 9.4% from 2012 (53%). Those who said that they used incentives for referrals to acquire new customers and employees went up to 42.5% in 2013, an increase from 36% in 2012.

“Our research shows that Canadian organizations are seeing the immense value that corporate incentive programs can provide when executed properly,” says David Eason, CEO of Berkeley Payment Solutions. “While this year’s report highlights how the use of corporate incentive programs in Canada is growing and evolving, there is room for Canadian organizations to improve their incentive programs through effective program design, flawless execution, and a continued focus on delivering a more measurable return on investment.”

This year’s results showed relative consistency in year-to-year budgets for incentive programs: 46% in 2011; 51% in 2012; and 47% in 2013. Budget remained the most important consideration when choosing incentives, but was down 7.6% from 2012 to 65.4% in 2013. Recipient satisfaction/participation however was a growing consideration in 2013, up 11% from 2012 – with 42.7% of respondents indicating it was a measure used to evaluate the success of their incentive programs. The study also found that more organizations are measuring their results than before. Those that said they did not measure results dropped by 20.6% from 2012.

The selection of branded or “points-based” catalogue merchandise as incentive giveaways was down from 59% in 2012 to 54% in 2013; while retail gift cards for specific stores, restaurants or services were up significantly from 62.8% in 2012 to 72.8% in 2013. For three years running, prepaid Visa, MasterCard or American Express corporate incentive cards ranked number one as the preferred incentive and in 2013, 47% of respondents said they were the incentive that most motivated Millennials over traditional merchandise and gift cards.

“Recipients want more flexibility in what, how and where they redeem their rewards. Greater choice in redemption options for the growing multi-generational workforce strengthens administrators’ confidence that their programs are motivating employees and channel partners in positive ways,” adds Eason.

The report also found that 63.2% of those organizations that ran incentive programs offered retail gift cards for specific stores and restaurants or prepaid Visa, MasterCard or American Express corporate incentive cards, citing they are the easiest to administer and provide the greatest return on investment. It also found that over half (53%) preferred a card with a Canadian bank brand (e.g., BMO, CIBC, RBC, Scotiabank or TD) on it.

“Prepaid Visa, MasterCard or American Express corporate incentive cards are our top choice for member and volunteer reward and recognition as they are backed by the security of a brand-name financial institution and can be redeemed for virtually anything the recipient wants or needs,” says Chris Larsen, VP Marketing and Membership, Human Resources Professionals Association (HRPA). “Plus, the redemption rates of these cards are much easier to measure than the use of traditional, company-branded merchandise.”

Almost one quarter (22.8%) of those polled cited “too difficult to administer” as the reason they did not run incentive campaigns, up from 13.7% in 2011 (up 9.1%). Those who cited “difficult to measure results or ROI” went up to 20.2% in 2013 – an increase of 7.6% since 2011.

“It’s clear that concerns about program administration and measurement are holding some Canadian organizations back from offering their own incentive programs. Turnkey, third-party administered campaigns can be the ideal solution for those who are too busy to design, manage and measure their own in-house campaigns but don’t want to miss out on an opportunity to gain a competitive advantage through a well-run corporate incentive program,” explains Eason.

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