Travel incentives are a reward subset of an

incentive program An incentive program is a formal scheme used to promote or encourage specific actions or behavior by a specific group of people during a defined period of time. Incentive programs are particularly used in business management to motivate employees ...

recognition program Motivation is the reason for which humans and other animals initiate, continue, or terminate a behavior at a given time. Motivational states are commonly understood as forces acting within the agent that create a disposition to engage in goal-dire ...

or a

loyalty program A loyalty program is a marketing strategy designed to encourage customers to continue to shop at or use the services of a business associated with the program. Today, such programs cover most types of commerce, each having varying features and ...

, which is a business tool designed to change

consumer behavior Consumer behavior is the study of individuals, groups, or organizations and all the activities associated with the purchase, use and disposal of goods and services. Consumer behaviour consists of how the consumer's emotions, attitudes, and pr ...

to improve profit,

cash flow A cash flow is a real or virtual movement of money: *a cash flow in its narrow sense is a payment (in a currency), especially from one central bank account to another; the term 'cash flow' is mostly used to describe payments that are expected ...

employee engagement Employee engagement is a fundamental concept in the effort to understand and describe, both qualitatively and quantitatively, the nature of the relationship between an organization and its employees. An "engaged employee" is defined as one who i ...

and

customer engagement Customer engagement is an interaction between an external consumer/customer (either B2C or B2B) and an organization (company or brand) through various online or offline channels. According to Hollebeek, Srivastava and Chen's (2019, p. 166) S-D lo ...

. It has been described as business travel that is designed to motivate or trigger action, as a reward for these actions from employees or business partners. This fosters loyalty and encourages the best talent for an organisation. When an organization properly designs an incentive program, which includes looking at all departments which will be affected, rather than just the impact to the department that is sponsoring the incentive, the return on investment can be proven. Oxford Economics USA wrote in a 2009 study that incentive travel investments yielded a return of investment of more than $4:$1. and stated that in order to achieve the same effect of incentive travel, an employee’s total base compensation would need to be increased by 8.5%. The Incentive Research Foundation released a study in 2010 following the steps that an organization took to ensure that they received a return on their investment; they successfully merged acquired organizations into their company, and successfully merged their incentive programs.

Economic impact

Incentive trips, meetings and events account for 15% of all travel spending, which creates 2.4 million jobs, $240 billion in spending and $39 billion in tax revenue, according to the U.S. Travel Association. Incentive travel generates about $13 billion a year, according to the Incentive Research Foundation. The economic impact and the

AIG effect American International Group, Inc. (AIG) is an American multinational finance and insurance corporation with operations in more than 80 countries and jurisdictions. , AIG companies employed 49,600 people.https://www.aig.com/content/dam/aig/amer ...

had negatively affected incentive travel programs in 2010, with spending on incentive travel being reduced.

References

{{Customer loyalty programs Customer loyalty programs Types of travel

Economic impact

See also

References