Last month, the Incentive Research Foundation (IRF) and the Incentive Manufacturers and Representatives Alliance (IMRA) surveyed small businesses with annual sales from $1 million to $50 million about their use of merchandise incentives. The results of the survey provide insight into the types of merchandise rewards small businesses are using, along with when and how they utilize them.
Here at Hinda, we wanted to give a special shout out to some of the study’s findings, as they hit home with big-picture takeaways of how incentives can be such a powerful business tool — whether small business or large, offered to employees or customers.
Merchandise incentives can boost morale.
Eight-two percent of IMRA respondents said that merchandise incentives are a good way to boost morale, and they aren’t wrong. Incentives are an effective way to celebrate milestones for your team, foster innovation, and generally excite people to work toward achieving shared or independent goals. By offering incentives and rewards, you show your employees that they are valued, and that their work and contributions matter and are recognized. For customers, it’s all about loyalty and engagement, and these too are celebrated with rewards.
Merchandise trumps cash when it comes to incentives.
Sixty-one percent of IMRA respondents said that merchandise rewards are more memorable than cash. In the world of incentives, this is a common topic of discussion: cash versus noncash. Ultimately, noncash rewards are thought to be more effective at providing the real engagement outcomes you’d be seeking in an incentive program: they can provide lasting memories, they can be more tailored to an individual’s personal interests, and they’re accepted to be better motivators than cash alone. It’s no surprise that noncash rewards are more strongly preferred by best-in-class organizations.
Companies which utilize merchandise incentives are often companies with growth.
As mentioned above, better-performing organizations tend to utilize noncash rewards. A study published on HR.com shows that 21 percent of best-in-class organizations use them, versus just 10 percent of all other companies. This trend was also apparent in the IMRA survey: 72 percent of those small businesses which used merchandise to motivate their partners had also reported growth in the last year.
Incentives are most effective when presented in a timely and thoughtful manner.
Among IMRA respondents, 70 percent said they prefer to present an award in person at company meetings/functions or on the spot. It's great to see that so many small businesses are behind this notion, because it’s one that can really impact the ultimate success of your rewards. Remember, the presentation of a reward is just as important as the reward itself. As explored in a previous blog of ours, rewards and awards are best presented in person, in public (among the organization), and in a timely manner relative to when the award was achieved. The reward is like a trophy, after all, and a trophy is best delivered right after the race, hand-to-hand, and in front of the rest of the team and supporters.