What is the ROI of Incentive Travel?

Does incentive travel work? What is the ROI (return on investment)? Do you have any case studies?

Business executives ask these questions when contemplating an incentive travel program. Their country club friend told them about their unforgettable trip and results. Now, they are doing their homework on ROI, sales lift, employee engagement, and costs.

A fantastic resource for research, statistics, and trends is the Incentive Research Foundation (IRF). The IRF published this all-time favorite list of the Top 7 Incentive Travel Facts. [Originally published in 2015 and updated in 2020; these are a “greatest hits” collection with timeless proofs.]ROI on Incentive Travel

Incentive Travel ROI Statistics to Keep in Mind

Here are the best incentive travel ROI statistics, plus extra details.

1. 46% of U.S. businesses use incentive travel
Incentive Federation

What are companies doing? Lots and lots of incentive travel. Running with this herd of companies must be wise business. With ½ of all employers being small and medium businesses having small sales teams, 80%+ of large enterprise companies are likely using group incentive trips.

2. U.S. Businesses spend $22.5 Billion annually on incentive travel
Incentive Federation

Public and private businesses are voting with their checkbooks on the importance of motivating and recognizing their top sales reps, channel partners, and customers. It’s a simple ROI test. If it did not work, companies would slash the investment next year.

3. Companies using non-cash rewards, including incentive travel, have 3X higher revenue increases
Aberdeen Research

Aberdeen did serious, scholarly research on this one. Cash rewards have a definite place in base compensation, bonuses, and commissions. But, incentive research from IRF and universities consistently shows that while cash is the most requested reward, it is not the most effective at driving incremental performance. Aberdeen reinforces that again here. IRF’s more recent Top Performing Companies studies, including the vertical industries of financial services, technology, and manufacturing, repeat similar findings.

4. 100% of Best-in-Class companies offer incentive travel to recognize sales success
Aberdeen Research

Maybe the lead-in questions should be rephrased to: “what are best-in-class companies doing? do you want to be the best too?” The IRF/Aberdeen Best Practices Study makes rigorous analysis of best-in-class companies, defined as those with the highest customer retention and sales growth.  The study provides hard, objective measurements of ROI. If the CFO wants ROI proof, this is your study! Or, the IRF Top Performer studies in #3 are equally positive.

5. Incentive travel is not just for sales. 53% use incentive travel to reward sales. 43% to reward employees. 33% for channel partners. And 27% to appreciate customer loyalty
Incentive Federation

Interesting. It is surprising the customer loyalty travel was high too. ROI for many different purposes, target audiences, and go-to-market strategies.

6. Properly designed incentive travel programs increase sales productivity by 18% and produce an ROI of 112%
Incentive Research Foundation

Notice the keywords “properly designed” and “executed.” Allow me one quick sales pitch. Brightspot is fantastic at design and execution! Really awesome! Many competitors are travel people; they like to travel. They are charming people and can be good at logistics (if they are not having too much fun themselves). The Brightspot travel team are incentive people who know how to motivate and reward real people delivering real ROI results with superb attention-to-detail execution. As evidence, see our comprehensive methodology on “properly designing” incentive travel programs at www.corporateincentivetravel.net or the how-to guide, How to Start an Incentive Travel Program.

7. Incentive travel budgets are now up to an average of $5,500 per person
Multiple Sources

This benchmark budget is helpful. It gives the VP of Sales a number to request. Of course, this budget amount moves every year. The best benchmark is the annual Incentive Travel Industry Index study jointly produced by the Incentive Research Foundation (IRF), Society of Incentive Travel (SITE), and Financial & Insurance Conference Professionals (FICP). The weblink included here is updated regularly to combine research from multiple sources. Budget estimates will grow for trips that are longer (more nights), farther (Europe, South America, Asia), or more luxurious (5-star resorts in elite destinations).

Case Studies for Incentive Travel

The IRF website has two strong, deep-dive case studies on incentive travel programs and their ROI results.

Channel Incentive Travel: A Case Study

Anatomy Of a Successful Incentive Travel Program

For additional help with incentive travel, visit our Travel page.

Mike May

Author Mike May

President | Author of 12.5 Steps to a Perfect Incentive Program and recognized as one of the Top 25 Most Influential People in the Incentive Industry. Expertise: bucket-list incentive trips, motivational incentive program design, matching event goals with the perfect destination & hotel, cost savings strategies, global channel reward programs, and targeted communications.

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