At the start of the new decade, the future for the incentive travel industry looked incredibly bright. Not only did our own data show that luxury event professionals were seeing increased demand for incentives, but results from the 2019 Incentive Travel Industry Index, a joint research effort from SITE (the Society for Incentive Travel Excellence), IRF (the Incentive Research Foundation) and FICP (Financial & Insurance Conference Professionals), pointed to an uptick in incentive travel spend over the next few years.
The Covid-19 pandemic may have changed that outlook in the short-term, but we’re confident that once the crisis passes and the economy recovers, incentive travel will be as important as ever for engaging, motivating and rewarding employees. In our recently published inVOYAGE Annual Report, we predict the following ten trends will come to the fore over the next decade…
Sustainability will shape the incentive experience of the future
Given the fact that we dedicated a whole section of the report to the subject of sustainability and CSR, it comes as no surprise that event professionals are predicting that sustainability will have a major impact on incentive programmes in the future.
“No doubt that incentives are changing, and I think the biggest change has to do with sustainability,” says Vianei Hermes, sustainability & project manager at Stockholm-based agency Hermes Group. “The “Greta generation” will not “have fun” at the cost of the planet. This is very strong in the Nordics for the moment, but gaining strength in Germany, Holland and the rest of Europe.”
Sustainability is shifting from being an afterthought and nice to have, to a necessity, and companies will respond by finding ways to curb the environmental impact of incentive travel, from offsetting the carbon impact of travelling to choosing green destinations and hotels. Countries such as Iceland and Sweden, which rank high on the Global Destination Sustainability Index, are increasingly becoming destinations of choice for eco-conscious corporates, according to CR Worldwide.
Claire Okrafo-Smart, director of incentives at UK-based Absolute Corporate Events, says: “I am noticing that more incentive clients than ever before are concerned about the environment, and this is going to have a bigger impact than probably anybody over the age of 30 can see coming. I think that carbon-offsetting will comeback in a big way.” Hermes agrees, adding: “That pressure is really coming from below from the employees. We’ve had delegates wanting to offset their own flights when the companies are not doing it.”
Train travel will make a comeback
Trains are one of the most sustainable forms of transport, and luxury travel experts on the leisure side are predicting that train travel will come back in vogue as eco-conscious travellers look for lower carbon alternatives to flying.
Flygskam, a flight-shaming movement in Sweden backed by Greta Thunberg, is also starting to gain momentum, which some planners believe will have a major impact on the incentive travel industry over the next decade and some client’s willingness to fly.
“Flight shaming is going to be a huge issue. I think people are going to have to be creative in finding a way to circumnavigate this,” says Angélique Eriksen, founder & CEO at Paris-based Egg Events. “For example, could you get to your chosen destination by luxury train? Or you could make the train travel part of the luxury experience? I’m sure the likes of Belmond will see an increase in their luxury train services.”
Hermes adds: “We have already got briefs that say no flights. Some customers only want a destination they can travel by train, or at least one option which can be reached by train within the proposal.”
Incentives will shift from consumption to contribution
As part of this move to become a more sustainable and socially responsible industry, incentive programmes in the future will focus on positively benefiting the host destinations.
“We are seeing a definite shift from consumption to contribution,” says Ian Cummings, global vice president, commercial at CWT Meetings & Events. “Incentives were traditionally all about consumption – where can I go, what can I do there and what do I get out of this. It was about taking pics and bragging to your mates on Instagram from a luxury five-star hotel with cocktail in hand.
“Increasingly it will become more about going to a destination and contributing to that destination. I think bragging rights themselves are shifting and a picture of you doing something good holds more sway than one of you swigging Champagne. That’s almost coming across as crass these days, and in ten years’ time, I think people will be shamed for doing that.”
ACE’s Okrafo-Smart agrees and highlights an incentive the agency delivered for a client in 2019 that featured litter-picking in the New Forest as one of the main activities. “I was a bit concerned as the company went from team-building in Amsterdam the previous year to litter picking in the UK, but the atmosphere was amazing. We got the local papers involved, which created a real buzz, and everyone was so engaged.”
Experience will outweigh destination
Destination choice is still incredibly important for incentives, with emerging or off the beaten track destinations that delegates have never visited continuing to hold a strong appeal for certain groups and clients.
But there are signs on the leisure side that luxury travellers are choosing holidays based around their hobbies and interests, as opposed to choosing the destination first. Mintel travel analyst Marloes De Vries, who presented luxury travel trends at inVOYAGE 2019, says “It’s becoming less about where you want to travel, and more about what experience do you want.”
Incentive agencies are also starting to notice this trend. “It’s definitely becoming more about the experience, whereas it always used to be the destination,” says ACE’s Okrafo-Smart. “Now people are thinking do I want to sit in economy class for 10 hours to a long-haul exotic destination, which will take up at least a third of the budget, or would I rather stay in Europe and put more budget into having an amazing experience? One of our clients, for example, has just chosen Seville over South Africa.”
Black Tomato Agency co-head and head of sales David Heron also believes that experience will outweigh destination in future. “We had an incentive enquiry at the end of last year where the brief focused on CSR over the destination – the client said what can we do that is worthwhile, and where is it. It’s the first time we have been given a brief like that and it’s really exciting,” he says.
Local experiences will lead the way
Sticking with the theme of experiences, when asked what types of experiences are most popular for incentives, 60% of the luxury event planners surveyed for the report said local/cultural experiences authentic to the destination.
“Authenticity is the new luxury,” says Hugo Slimbrouck, director of strategic partnerships at Ovation Global DMC. “Delegates today don’t care about Champagne, caviar and lobster. They are looking for authenticity and want to understand how the locals, live, work and eat.”
Ultimately, it’s about access and giving individuals the opportunity to experience something they can’t elsewhere, which will increase pressure on both agencies and DMCs to seek out more creative, unique and authentic local activities.
Bethany Chamberlain, event director, USA at TAG (The Appointment Group) believes that this is being driven by the younger generation. “They are all Instagram mad and want to share the amazing and life-changing experiences they have when they travel, rather than pictures of the luxury hotel they are staying at.”
Education and the opportunity to learn will be key
And “life-changing” could well become a new buzzword for incentives over the next decade as employees, particularly Generation Z, increasingly demand incentive trips that enhance their life in some way.
“An experience can be quite a diverse spectrum of things. It could be high profile individuals to engage and spend time with, for example experts in fields such as sports, artisans or chefs. Incentives will become more about education and coming away from a trip having learnt a new skill or something to enhance your life beyond the event,” explains Black Tomato Agency’s Heron.
Egg’s Eriksen says that actively agency is putting together learning expeditions around Expo 2020 in Dubai, that will be high-end like an incentive, but will give groups the opportunity to learn about topics like sustainability.
Cummings adds that CWT is doing a similar thing and pitching incentives that are more like learning exchanges, for example taking an automotive client to look at and learn about electric powered cars or a visit a high-tech or carbon neutral city.
More incentives will feature a business element
With education becoming a key theme, there also will be a trend for more clients to use incentives as an opportunity for business, for example to share key messages or reflect on company values with employees or partners.
More than half of the planners we surveyed (59%) said they had seen an increase in the number of hybrid events that include a meeting and incentive. “Incentives often provide companies with vital face-to-face time with their channel, and we’ve seen some clients add a day meeting into what used to be a pure incentive to ensure they get the best value out of that time,” says BI Worldwide, design director, events, Katrina Rannard.
Meanwhile, Pure Events founder & CEO Charlotte Gentry is seeing more companies add incentive elements to their meetings. “A lot of companies are organising overseas conferences with a strong activity element. It might not be a traditional sales incentive that rewards top performers, but it’s still an incentive for employees to work for that business.”
Beyond the sales team
The traditional sales incentive for top performers continues to be popular, and that won’t change anytime soon, as its proven tool for driving sales growth. However, Joost de Meyer, chairman and CEO of US-based First Incentive Travel says: “The trend is also that it’s not only sales related people who go on an incentive trip. Other departments are increasingly part of the incentive travel challenge.”
This is a trend that came up in our first inSPIRE report last year and looks set to become more prominent over the next decade. Steve Hodges, former director of incentive travel at Mary Kay Corp who recently set up his own incentive consultancy, WOW consult, says: “I agree that incentives do not need to be limited to sales. If an employee impacts your bottom line, and let’s be honest all employees should, then find a way to reward for that impact.”
The challenge for non-sales incentives is how to qualify people for that trip. Holly Mills,
head of incentives at Penguins Events says: “We have been doing a lot of work behind the scenes to create an ROI model and the best solution we have found at the moment is to really try and understand the client’s values and try and align the qualifications with those values.”
Okrafo-Smart says this is exactly what one of the agency’s clients is doing. “We have a 200pax incentive to Milan in June this year which used to just be sales staff. Now, 50% of the people on the trip are nominated to win a place against the company’s core values, so it could be anyone from the receptionist to marketing manager.”
Second tier destinations will come to the fore as over-tourism grows
The last couple of years has seen increasing press coverage of the negative impacts of tourism to some of the world’s most popular destinations, and the term ‘overtourism’ has entered the public consciousness.
Barcelona, Dubrovnik, and particularly Venice, are among the favoured event destinations suffering from overtourism, or too many visitors at peak times of the year. Incentive clients and agencies are responding by shunning the crowds and opting for secondary cities or destinations instead.
BI Worldwide’s Rannard says: “An example could be that looking at Rotterdam instead of Amsterdam. Or choosing Bilbao instead of Barcelona. You can still achieve your objectives and provide an amazing experience, and the benefit of secondary destinations is that people are less likely to have been there.”
There’s also a financial advantage of secondary cities too, since overtourism can drive up the costs of hotel and airfare and decrease availability. “We pitched a programme in Budapest against Rome and found we could do so much more in Budapest because the budget went so much further,” says Okrafo-Smart.
Wellbeing will be at the heart of incentives
Last but by no means least, employee wellness and wellbeing will continue to gain prevalence in incentive travel programmes, according to the 2019 Incentive Travel Industry Index.
“There is definitely a shift in wellness and community fulfilment being incorporated in incentive programmes, whether that is for personal growth or connecting people and fostering strong communications among teams,” says Chantal Challenger, regional account manager at BCD Meetings & Events in Asia.
CR Worldwide’s recent report ‘The rise of Corporate Wellness 2.0’ reveals that incentive, reward and recognition platforms, as well as corporate travel and events, are being increasingly designed around improving mental and physical health. It shows a dramatic 56% rise in activity or nature breaks, often involving animal encounters from gorilla trekking to rhino tagging. This demonstrates a significantly greater commitment to employee benefits based around mental and physical wellbeing, in the form of healthy activities and social experiences.