Incentive - August 2008 - (Page 68) AWARDS LUXURY GIFTS “This guy dreamed of owning horses. Now, thanks to his hard work, he does.” –Barry Wegener, Carlson Marketing “We haven’t seen a drop-off in the frequency of [reward] events or the number of rewards within the luxury marketplace. Not yet, anyway,” says Tom Taraci, president of TJT Motivation in New York. According to Taraci’s colleague, David Groveman, high-end luxury items are affordable for companies, because they are not given out frequently or in great numbers and they always provide a return on the investment. “Luxury items definitely provide a good ROI,” says Taraci. “People appreciate the level of quality, and the prestige of the brand they are given really means something to employees when they items like Cartier watches, Gucci handbags or cruise gift certificates worth thousands. Other companies use credits or point-based systems that allow their employees to select a personalized incentive reward. The most over-the-top items often come from accruing and banking a certain number of these incentive recognition credits and points. According to Taraci’s company, the average price range for luxury items is $250 to $1,500. But accrued credits and points over time can translate into tens of thousands of dollars worth of merchandise. The results of saving up credits may mean a big difference, the difference guy spent time at a local racetrack and admired a horse there. He asked his company if he could cash in his credits to buy the horse from the track,” says Barry Wegener, senior director of marketing and communications for Carlson. “The company came to us to facilitate the sale of that horse. We’ve actually helped the company buy several horses in past years for this particular employee. This guy dreamed of owning horses. Now, thanks to his hard work, he does.” COOL CAR OR COOL THREADS The Unity Marketing Luxury Consumption Index for the third quarter of 2007 showed that despite lower consumer confidence levels, spending on luxury experiences rose by 11 percent last year. For Chris Kemp, a web programmer from Ontario, Canada, his luxury experience is driving a million-dollar racing car. “I am an avid car racing fan and I noticed that in our catalog we have a ‘Formula 1 Fantasy’ where you get a half-day with professional training on racing techniques, then take the car out for a spin,” says Kemp, who works for Toronto-based I Love Rewards Inc., an incentive company that creates online points-based solutions. According to Razor Suleman, CEO of I Love Rewards Inc., the items like the Formula 1 Fantasy are worth well over $10,000. “The problem with larger-ticket items is that they are generally not an immediate form of recognition,” says Suleman. “But it is important to have these larger-ticket items as an option for people.” Kemp eventually earned enough points to make his dream come true. “An experience like this is on the higher end of point costs in our catalog, so it took me a while to save up,” says Kemp. “But that was all the more motivation to work harder, get noticed and earn more points so I could get to my goal. Made in America, a Victory motorcycle is a high-end experiential reward winners get to take home receive them.” In a recent Incentive survey, 66 percent of respondents reported that their use of luxury brands had remained steady over the past few years. Nearly a third of the respondents added that they planned to increase their high-end rewards spending this year. Some companies offer specific between receiving a high-end and superdeluxe item as an incentive reward. For example, Carlson Marketing Inc., in Minneapolis, helped facilitate the sale of several racehorses for an automotive client. “This company had a sales employee who did very well and accrued a large number of incentive reward credits. The 68 | Incentive | August 2008 | incentivemag.com http://incentivemag.com
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