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Spa Treatments, Sporting Events Top Experiential Awards Offerings

By Nov 09, 2005

Experiential awards, including spa and sports packages, are far surpassing cash awards as incentives as companies continue to tap into employees’ emotional needs. More and more companies are rewarding valued employees with true experiences to keep them motivated or just to show their thanks.

“The industry is constantly challenged to find things that are compelling for recipients,” said Michelle M. Smith, VP-business development, of OC Tanner, a provider of employee recognition programs based in Salt Lake City, UT. “You want to have something that will excite everyone. Companies are getting creative.”

Spa packages (think facials, massages, and manicures) still reign as a top incentive offering, and have for the last five years. Companies like to indulge employees with something “they wouldn’t necessarily buy for themselves,” Smith said. Other popular ticket items include sports packages (think golf and skiing) and travel.

Companies are moving away from rewarding employees with cash incentives because employees feel it is something they are owed, said Duane Penner, VP of corporate, for, Roadtrips the Winnipeg, Canada-based incentive travel provider.

“You get a longer term return on your incentive dollar than if I get you a $1,000 bonus,” Penner said. “Companies are realizing [experiential awards] are far more effective.”

Smith agreed. “Cash is very dangerous and very risky,” she said of its use as a reward. “People think about it as compensation. Should you change or stop the program, [employees] feel you are taking something away.”

But with experiential awards, “you get tremendous mileage,” Smith added.

When it comes to incentives, companies are more apt to offer employees experiential awards to “get their attention and their performance level up,” said Tony Roth, president and CEO of Utix, a rewards provider based in Burlington, MA.

“There is an emotional value that comes across as being more thoughtful…as opposed to cash to go spend somewhere,” Roth said. “For us, an experience ticket is all about non-restrictive, first class experiential access, which is a round of golf or a day on the slopes. It’s all on the idea of removing the cash expectation and inserting the emotional feel of doing more of what you love to do.”

Utix recently signed a two-year agreement with Elizabeth Arden Red Door Spa Holdings, a provider of beauty and spa services, to offer a spa experience ticket with branded Red Door Spas and Mario Tricoci Hair Salons & Spas.

While spas experiences continue to hold their own, other experiences, including water sports and cooking classes are finding their way.

“If it can be termed a lifestyle choice…chances are in the next five years you will see an experiential ticket around it,” Roth said.

For Roadtrips, experiences are trending toward bigger ticket items. Companies want to give employees it all, Penner said. For example, some lucky employees can drive a Porsche or Ferrari in Germany and stay at a five-star hotel, he said.

“Experiences are becoming bigger and more exotic,” Penner said. “People are just trying more and more stuff at more exotic places. It’s that ‘I want it all’ mentality. We keep trying to add experiences that get people to say, ‘Wow’.”

For others, the ultimate experiential award translates into driving a NASCAR car, flying a fighter jet or experiencing zero gravity, Smith added. ‘When you are giving an experiential award, you want to have a lot of choices,” she said. “Choice is critically important just to make sure you are covering the variety of tastes of your recipients.”

While experiential awards is still fairly a new category in the incentive industry, experts predict a booming business.

“Experiential awards are very much in their infancy as an award category, but rapidly becoming a toddler,” Smith said. “They are learning to walk and rapidly learning to run here. They will only continue to grow.”