Promo - April 2008 - (Page S7) “Merchandise can be used effectively for many different demographic groups,” notes Paula Godar, director, brand communications for Maritz Motivation, which employs a proprietary tool to measure which incentives employees find meaningful. “You need to understand who your participants are, and your objectives.” She adds: “If you have very high-income participants, they may value things that they don’t have the time to seek out themselves. Maybe you send them on a trip, and the latest designer handbag is there as a room gift. Others may prefer gift cards for restaurants or items that are more a part of normal everyday life, like a grill.” Branded merchandise can be chosen to fit with a company’s mission or performance program. It also has immediate impact and a long, visible life. Employees and channel partners may express an initial preference for cash, but performance improvement pros stress that rewards that enable guilt-free spending and provide a lasting memory are the most successful in supporting performance goals. A case in point: A global office equipment company that ran a merchandise incentive program for dealers for many years switched to a cash card that could be used virtually anywhere. Sales proved disappointing. When Maritz analyzed the plan, it found that most points were redeemed for every day retail, gas and grocery purchases. In some cases, the card was used for purposes that did not complement the company’s brand. Maritz recommended a combination of merchandise and a filtered retail card, along with program rule changes and quicker claims processing. Results: Participation jumped by 42%; productivity improved (the average number of units claimed by dealer sales reps rose from 1.4 to 2.2); the product mix was successfully shifted toward new models; and the ROI was 17:1. SPECIAL ADVERTISING SUPPLEMENT It’s no surprise that many firms are now offering popular items like MP3 players or PDA’s as incentives to view online video pitches/Webinars or sign up for a live sales presentation. Merchandise ranks with gift cards as the most common thank-you for business customers. How do companies select client gifts? According to a 2007 American Express holiday survey, 62% of the managers in medium- and large-sized companies are given guidelines. And 40% are provided with guidance on how much to spend on clients. In addition, 19% receive input on the nature of gifts (personal vs. “deskbased”). The average amount spent on a client gift last year was $38.50. Here’s a round-up of some other key trends in leveraging branded merchandise as part of corporate or B-to-B incentive programs: Presentation Makes All the Difference Much of the value of an award to the individual and the program as a whole comes in recognizing, reinforcing and celebrating the achievement of objectives. “It’s important to give people the accolades that go with the physical rewards,” says Jimmy Beyer, national sales manager for Sony Electronics Inc. “Make sure that the winners are presented with their awards or recognized in front of others, if possible. If not, find some other way, like sending out an e-mail from management to the whole division or company.” This applies even if winners are selecting awards online and having them delivered to their homes. If gift cards are being presented, they should be in personalized carriers and/or envelopes or packages personalized inhouse. GREATER EMPLOYEE INCLUSIVENESS More companies are using branded merchandise for non-sales employee incentive and recognition awards, according to Spencer Toomey, vice president for The Corporate Marketplace and an IMA board director. “Many are giving service awards to employees at lower levels than in the past, and spending more money on rewards for these levels than in the past,” he adds. “For example, a company might give a higher-priced, as opposed to midrange, watch—a brand that speaks for itself, where the value doesn’t have to be explained or promoted.” Some of this reflects recognition that people don’t stay at companies as long as they used to; some of it reflects willingness within talent-competitive fields to spend more to attract the best employees, he notes. S7
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