Sending the entire sales team to Ulanbataar for a crash course on the intricacies of Mongolian horsemanship doesn’t come cheap.
So, it goes without saying that you’re going to want to work out whether you got your money’s worth. Read on for the nuts and bolts of tracking the returns of your incentive travel program.
Let’s start with a couple of definitions
ROI, or Return on Investment, is a well-known and easy to grasp concept. To calculate ROI, the benefit (or return) of an investment is divided by the cost of the investment. The result is expressed as a percentage or a ratio. (This is not to be confused with the self-fulfilling, “carrot on a stick” definition of ROI, where incentive travel is used as a reward for selling a certain amount of product.)
You’re not alone if you thought ROO was an endearing diminutive for an Australian marsupial. While not nearly as well known as ROI, Return on Objective is often a more appropriate way of measuring the success of many incentive travel programs. ROO enables teams to prove campaign impact when it’s not possible or feasible to tie them directly to sales.
Next, let’s unpack a couple of alarming stats
Given the high stakes and significant costs of incentive travel, we were particularly baffled to read that Society for Incentive Travel Excellence has found that a whopping 47% of clients and suppliers do not measure their programs’ success.
Meanwhile, the IRF’s SIGNATURE STUDY 2019 on “the use of non-cash rewards and recognition” notes that “across all types of reward and recognition, the primary success indicator used by program owners is the energy and enthusiasm of the participants.”
While we’re the first to acknowledge that gauging the efficacy of an incentive travel program can be complex, we don’t think that’s a good enough reason to give up without so much as trying.
Fortunately, it doesn’t have to be this way
You don’t have to be William Smith to figure out that it’s impossible to measure a program’s success if you don’t know what it’s trying to achieve. From the moment you conceive an incentive travel program you need to have a clear idea of the program’s goals and objectives. (Spoiler alert: “I’ve always wanted to go surfing in Bali,” is not a valid objective.)
It may be that you have a clear and easily measurable short-term goal for your incentive travel program. Perhaps you want to increase sales (who doesn’t), reduce staff turnover or even improve workplace safety. Other goals, such as increasing camaraderie or improving your brand’s reputation aren’t just harder to quantify, they also take longer to bear fruit. But as the saying goes, when the calculating gets tough, the tough get calculating.
No matter what your goals are, the best – indeed, the only – way to work out whether they have been achieved is to compare the situation before the incentive travel program with that, after participants’ bags have been unpacked and their tans have faded.
Measuring ROI is easy
If the goals of your incentive travel program can be directly linked to financial performance, then you’ve got a relatively easy task ahead of you. Simply identify the exact area where you wish to see an impact and – six or twelve months down the line – divide the benefit of the investment by its cost to arrive at your ROI.
Remember that if you only sent a few lucky members of the customer service team on that unicycling tour to Moldova, you should not expect to see an across the board increase in customer service scores. Instead, compare the performance of those who went with that of those who didn’t to see if it was all worthwhile.
Measuring ROO can be a bit trickier (but not always)
Sometimes measuring ROO is as simple as measuring ROI. If you’re trying to reduce workplace accidents, for example, it should be fairly easy to ascertain whether your initiative is working. That being said, don’t fall into the trap of ascribing all improvements to your incentive travel program. That brilliant health and safety officer probably has quite a lot to do with your improved safety record. And the new on-site creche likely explains why you’re finding it so much easier to retain working moms.
More ethereal and long-term objectives such as increased engagement, camaraderie and brand loyalty are harder to translate into decimal points and percentages – but this doesn’t mean you shouldn’t try. (As an aside, that beer-soaked bear hug on a Barcelona beach has done nothing for team spirit if Barry and Brian resume their bickering the moment they get back to the office.)
The boffins in your HR department will be able to provide a meaningful appraisal of the trip’s achievements – all you need to do is brief them. With social media, software, algorithms and big data at their fingertips, assessing impact has never been easier.
Never underestimate the trusty questionnaire
Regardless of whether you’re measuring ROI or ROO (or both) you should still get immediate after-the-fact feedback from everyone who goes on an incentive travel trip. It’s hard to underestimate the value of candid feedback on what worked and what didn’t. Phrase the questions right and you’ll also gain some valuable insights into what folks would like to see more of next time and how the trip might better achieve its objectives.
When creating the questionnaire, remember that respondents need to feel comfortable enough to answer truthfully (anonymous questionnaires are often the way to go) and also try to steer clear of anything that feels too much like a matric exam. Grainy photocopied questionnaires are out; app-based interactive ones are in.
The long and the short
All companies and individuals who make significant business investments need to be able to justify the spend – without exception. Measuring ROI and/or ROO is vital to ensuring that your incentive travel program is fit for purpose. (As an added bonus it’ll also make it easier to get the bosses to agree to next year’s trip.) Speak to GET Rewards about making, and measuring, your incentive travel dreams. We’ll make sure you get plenty of bang for your buck.
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