Incentive - June 2008 - (Page 22)

replace them as the new “big thing.” Q Do people still want a new digital camera? T H : I think Canon retires their models about every three months. So, yeah, it just doesn’t take long until there’s a new model coming out, and if you’re in the market for a camera, then [you feel], “I better get the newest, because the market has trained me if I don’t get the newest, I’m getting something that’s old.” that we had in the lower-priced rewards and we’ve addressed that now. So, it will help us become better in what we do by having someone compete with us. M K : I am in a different division [from Amazon.com’s incentive merchandise fulfillment], but from what I see, this helps the entire industry. I think any time someone enters a market that changes the game a little bit, it helps everybody elevate their game, and it’s made things better for the entire industry. One of the major electronics makers’ reps recently told us that the overall value of redemptions has been stable, but the participants were buying smaller products with their points. Have you seen anything like that? N J K : Yes, we definitely are shipping more packages, and they’re a smaller dollar value each. Particularly at the end of the year, we usually say it’s because people have leftover points, and they want to get them spent before they run out. But it’s happening more than just the end of the year. One of the things I discovered when I was doing a little research on the Millennials is that they’re not into buying so many of the big products. They don’t want to spend all their money on one thing or in one place. Whether what we’re seeing is a lot of Millennials involved in these programs using that philosophy to redeem products, well, I don’t know. But it’s probably been that way for a couple of years. M A : What we’re seeing is that by offering lower awards, we get somebody engaged in the program by having them redeem. You can get the participant to engage in the program, and that’s the goal. However, your average order size is going down [because of] the increase in low-end redemption, but the total redemption dollars grow. B H : Isn’t it because they’re starting to do their incentive programs not just for the top performers, they’re trying to get down to that customer services or the technician or whatever? So, maybe the value in the program is that they can only get some of those smaller items. Send comments to feedback@incentivemag.com Tim Houlihan, BI Brian Martenis, Incentive Worldwide Travel Millennials: Anything particularly different in terms of what they want? M K : Regardless of whether it’s Millennials, or the boomers or [any other demographic], it’s making sure that they have the choice to select what they want, whether it’s the latest camera or the latest book or whatever it might be. There’s such a diverse range of demographics that we’re serving now in the employee market. Q Q Q Is global fulfillment still a hot topic? M A : We got into global fulfillment through partnerships five, six, seven years ago now, and it’s basically been an investment for a market that we felt was coming. Our customer base was global, and they were talking about servicing their employees or dealers or sales groups. I think in the last couple of years we’re starting to see revenue from this area—both from our partners utilizing us and us utilizing our partners. It’s starting to occur. It’s not the dominant trend, but I think those of us that do it realize that this is something that is building and will continue to build. There was a lot of buzz and concern [last year] in the industry when Amazon entered the incentive merchandise fulfillment market. What’s going on now? M K : Everybody’s looking at me. [laughter] M A : There has been a lot of, and there still is a lot of talk in the industry. The talk has probably died down somewhat from the original interest. They have done some business, and we’ll see. From our perspective, it pointed out some of the weaknesses Q years hot product categories like iPods and digital cameras were the “big thing.” While these products are still strong redeemers, they are not as strong as before. The current new consumer electronics products such as GPS [global positioning systems] or Blu-Ray [high-definition DVD players] are not dominant enough to 22 | Incentive | June 2008 | incentivemag.com http://Amazon.com http://incentivemag.com

Table of Contents Feed for the Digital Edition of Incentive - June 2008

Incentive - June 2008 Contents Editor’s Note In The News Cover Story: Seventh Annual Industry Roundtable Incentive Interview Case Study Soft Incentives Empowerment and Engagement The Incentive Career Incentive Primer Travel News: Where To Go and What To Do The Cook Islands Field Report: Bermuda Potentials: Here and Now 50 Top Motivators: The Best of the Best Electronics: High-end Audio Equipment Gift Cards: Should One Be Enough? Advertiser Index Off The Cuff

Incentive - June 2008

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