Being the 2018 Chairman of “IRF” (the Incentive Research Foundation) gives me an up-close view of the best research on incentive travel, motivational meetings, and non-cash rewards.  My colleague, Michael Butler, has a leadership role with SITE (the Society of Incentive Travel Excellence) on the Research & Education Committee.  We are passionate about giving back to this great industry.

We huddled together and summarized the top 6 most important findings and facts from IRF, SITE, the  American Express Global Meetings Forecast, and other industry readings, along with our recommendations on actions you should take in 2018.

#1 Optimism is High, Despite World Events

The first key finding in the 2018 SITE Index report is there’s more optimism about the world and national economies among both buyers and sellers.  Although the threat of terrorism remains a concern, it has decreased compared to 2016.  The 2017 survey was taken by 574 professionals in 72 countries which makes it the incentive industry’s most engaging research by volume and geographical spread of respondents.  SITE summarizes with this powerful statement: “incentive travel works.”

Coincidentally, IRF reports optimism too.  The IRF Outlook Study launched a new, simplified metric called the Net Optimism Score.  While I read all this heady research because of my board role and leadership position here at Brightspot, I love-love-love the simplicity of a single number to measure the economic outlook for incentive travel.  For 2017, the “NOS” was 26, which indicates an optimistic outlook and matches the SITE Index findings.  Similar to the Net Promoter Score used to gauge the loyalty of customer relationships, the IRF Net Optimism Score is the percentage of people providing a positive rating, subtracted from the percent giving a negative rating.


Be Optimistic

#2 Incentive Travel Budgets Grow

The SITE Index concluded that average 2017 incentive travel spending increased over 2016, and the number of eligible people increased too.  SITE said the average per person increased from $3,000 to $4,000.  The IRF Outlook Study drilled down a little more precisely saying the average per person has increased 4-5% annually for three consecutive years from $3,590 in 2015 to $3,755 in 2016, and $3,915 for 2017.

Here’s the important commentary.  This budget average is pushed lower by short, 2-3 night trips.  Notice the survey is not average spend for a typical, 5-night program.  In my experience, most Fortune 2000 clients are investing over $5,000 per person on incentive club trips for 4-5 nights.  As further proof, the IRF reports that 40% of companies spend more than $4,000 per person.


Match Proper Investment to Your Target Audience

#3 Costs > Budgets

IRF and SITE both report that costs are increasing faster than budget increases.  Buyers and meeting planners are looking to reduce costs by cutting activities, reducing gifts, or even reducing the number of nights or winners.  In this strong economy with low unemployment and CEOs demanding talent, it’s downright fool-hearty to cut winners.

The American Express Global Meetings Forecast has reported hotel room rates jumped 5% for 2015, 2016, and 2017.  For 2018, AMEX predicts a 3% increase, and it adds that F&B costs are rising as well.


Tell “Tight Pockets the CFO” you need more money

#4 Greater Investment in Technology

With this incentive travel fact, both IRF and SITE share the same findings of greater investments in technology – for audio-visual production, WiFi, events apps, and other advanced technologies.  The destination and hotel get the podium promotion, but technology is becoming an increasingly important part of programs—whether it’s communications, engagement, or operations.

Event app adoption is hard to pin down, but in my view, we’ve reached the tipping point where events apps have shifted from nice-to-have to must-have (at least for incentive trips with 100+ attendees.)


Add an Event App (or make it better)

#5 Matchmaking Disconnect

That’s a new term.  I made it up to describe the challenges third-party incentive travel planners (or internal corporate meeting planners) are having to sync up increasing lead times necessary to source incentive-quality hotels with Corporate America’s decision cycles.

In the market, all metrics point to increasing demand and shrinking supply.  Hotel occupancy is increasing.  Room rates are increasing.  Travel for groups, transient business, and leisure are all up.

New construction is slow. Well actually, overall construction is up, but it is for limited-service hotels that lack meeting space and are not “incentive quality.”

Meanwhile, Corporate America is indecisive and distracted, especially for public companies that live on a quarter-to-quarter treadmill.  So many decisions are made, budgeted, and funded in the current quarter.  We recommend incentive travel clients choose and contract their next incentive destination and hotel 15-18 months in advance to maximize the publicity and motivational benefits during the qualification period.


Start Earlier

… or expect to pay more

… and accept fewer options

#6 Experiences are Everything

We all hear the phrase this is an “experience economy.” Millennials crave experiences.  Every study from IRF and SITE reports that all generations desire new travel experiences.  We live in a Facebook, Instagram, social sharing world.

Incentive trips have been adding unique, authentic, local activities.  Events are becoming foodie festivals, and hotels are building and renovating new venue spaces.

Most President Club incentive trips develop traditions that push against new experiences.  I know one company that goes to Hawaii every year.  Hawaii is my favorite place, and each island offers a different experience; but who would think an executive says “I’m tired of Hawaii.”  Many companies are beach-beach-beach.  Fun & sun.  Sun & sand.  Others may choose Europe or a golf resort every year instead of something tropical, but it is still likely they keep going back instead of a new experience.

The simplest way to create new experiences is to pick a new destination.  Alternate between beach and mountain.  Mix in Canada and Europe.  If your company cannot break away from the beach, at least rotate Hawaii, Caribbean, and Mexico.


Pick a new place


If you’re looking to improve your incentive travel program, check out these 9 tips from our travel experts!

Michael Butler

Author Michael Butler

Director, Business Development | Expertise is listening, recommending alternative solutions and offering extreme customer service.

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