How to Use Incentive Travel to Motivate Your Team

Hawaii shoreline seen from above

You already have outstanding employees.

The question is, how can you increase their productivity and loyalty?

Showing them that they’re appreciated is often enough!

The Skinny on Travel Statistics

So how do you show your employees you value them?

Kind words and encouragement help, but so do rewards. And there’s nothing more consistently appreciated than a vacation.

Here’s the thing: Almost everyone loves to travel, but most people can’t justify putting their hard-earned money toward a luxury trip.

Recent studies show that the majority of individuals want to travel more, especially after their forced COVID-19 quarantines. Between pandemic restrictions and limited funds, they haven’t been able to satisfy their wanderlust.

The obstacles have caused decreased hope for vacations, especially international trips. Less than 30% of people think they’ll be able to travel outside of the country.

But nearly 80% want to take a vacation—somewhere, anywhere, as long as it’s fun and affordable.

Incentive Travel Solves the Problem

That’s where incentive travel programs come into play. Your employees have a valid reason for indulging in their vacation desires, and they have little out-of-pocket expense doing so.

This type of trip is similar to, but not the same thing as, holding a corporate event or a meeting and sending your employees off to attend them.

Instead, incentive travel emphasizes socializing and team building over the business aspect of the event. As far as planning goes, the process is comparable. In fact, incentive travel and corporate planning are often linked together.

Some of the pieces will overlap, but the overall focus of an incentive travel program is inherently different from the goal of a corporate meeting.

And this is a crucial fact that you should keep in mind as you put your program together if you want to really motivate your team.

This guide will take you through the ins and outs of using incentive travel to optimize your business and staff. After reading, you’ll know how to coordinate each step to streamline the process as best as possible.

Table of Contents

1. What Is Incentive Travel?
2. Pros and Cons of Incentive Travel
3. How Incentive Travel Boosts Morale (and Your Bottom Line)
4. Planning Your Incentive Travel Program
5. How to Plan an Incentive Travel Program
6. Resources You’ll Need to Plan the Trip


1. What is Incentive Travel?

An incentive is anything that entices a person to complete a task. We all work for the incentive of our paycheck and benefits. Yet, sometimes, going above and beyond the primary rewards can increase motivation and appreciation.

That’s where incentive travel benefits your company. In a nutshell, it’s rewarding productivity and/or loyalty with an all-expenses-paid trip for your employees that puts their enjoyment and relaxation over any business objectives.

What Does it Involve?

Typically, the getaway is three to five days, but that’s up to you to decide.

The only catch is that this fantastic excursion should have a set itinerary for part of the time.

The scheduled activities don’t need to be tightly structured, but they should showcase to those on the trip that the company is rewarding them.

What’s the Cost?

The Incentive Research Foundation suggests a well-designed program will cost an organization approximately 1.5-2% of its payroll. The idea is that the return on this investment will more than pay for itself.

The Goal of Incentive Travel

Many businesses of all sizes use some variation of incentive, loyalty, or recognition programs. The goal is to entice staff, customers, or salespeople to hit a specific objective — usually a targeted increase in sales or additional customers.

This objective is advantageous for every company, regardless of its size, so incentive travel programs are universal.

When the program participants qualify by reaching the preset goal, they get to reap the benefits of the reward.

Companies can choose to implement team or individual incentive programs or a combination of both.

You may also like: Tips For Hosting a Group Business Lunch Meeting


2. Pros and Cons of Incentive Travel

Portrait of smiling african female student walking with cellphone

A thoroughly designed incentive program has many advantages, which is why the idea appears in almost every industry.

In fact, 94% of the top companies in the United States are using travel rewards post COVID-19.

Some of the most obvious benefits to the company and participants include:

  • A hefty boost in productivity; in fact, travel incentives tend to bring in better results and an increase in revenue
  • Reaching targeted sales objectives; companies that want to pinpoint sales of one product or service over another can use that goal to drive the incentive program
  • Morale increase in the company as participants share excitement over the itinerary before, during, and after the trip

Along with every incentive program, there are always a few drawbacks. Knowing about them ahead of time helps you prepare and eliminate many of the issues.

Budgeting

Many smaller or newer businesses run on a tight budget. Since you know you want to reward your staff but have limited funds, you can work on finding discounted services.

Try using Hotel Engine to negotiate the best rates for lodging. With the time and money you save by going through their platform, you can delve into researching even better destinations.

Full Buy-In

The next obstacle is finding an enticing getaway for the majority of the participants. No matter where you choose as your location, you’ll never satisfy everyone.

Get to know your audience and do the best you can on your budget. A tropical paradise like Hawaii is a dream trip for many people but disinteresting to others.

Staff Shortages

It’s true that many of your top performers won’t be working as usual for the duration of the trip. Even those who can work from anywhere want to relax on their vacation.

However, the return on your investment should more than cover the loss of their short trip. Just be sure to have someone lined up to handle customer service for a few days.

Weighing the pros and cons of using this incentive is essential. You don’t want to invest a large portion of your rewards program into something that you threw together haphazardly.

Related resources: How to Create an Employee Travel Budget for Small Businesses and A Beginner’s Guide to Planning Business Travel Arrangements


3. How Incentive Travel Boosts Morale (and Your Bottom Line)

What are you currently using to motivate your employees or salespeople? How are you encouraging your staff to stick with your company and maximize their productivity?

You’ve seen this in action with credit card companies, hotels, and other places trying to gain business. Cash-back, points for free rewards, and gift cards are common incentives.

These work to a degree. But studies show that using travel incentive programs can increase gains by more than 20%. The longer the program runs consistently, the higher the gains become.

Increasing Morale and Decreasing Turnover

Consistent use of travel as an incentive is a coveted carrot (minus the stick!).

The keyword here is consistent.

The first time you roll out a travel incentive, it’s going to take a little while for it to take root. By the time everyone understands what’s at stake and how to earn it, many participants won’t reach the objectives because they’ll get a late start.

Using Ongoing Trips as Tangible Awards

If you only offer individual or group incentive travel once, those who don’t make the cut might resent the people who do.

But if they know there’s another one coming down the pipeline, they’ll watch for it and work harder to earn it the next time.

Incentive trips are a tangible award. From pictures to social media to individual stories of their travel experiences, the impact is visible and felt in a way cash awards can’t match.

Cash versus travel decisions also makes a difference at tax time. Cash awards are automatically added as income and taxed at value. Travel rewards are taxed, too, unless they fall into the area the IRS considers to be for business purposes.

Talk to your accountant as you plan your agenda to see exactly how much of the trip must be spent professionally if you don’t want your employees taxed.

When the people who earned the trip get back, their word-of-mouth advertising will ignite the energy again.

Anyone who wants to enjoy the getaway next year will not only work harder, but they’ll stick around. Voluntary turnover rates decrease, and morale skyrockets.


4. Planning Your Incentive Travel Program

Portrait of tourist woman standing nearly window, looking to beautiful view with her luggage in hotel bedroom after check-in. Conceptual of travel and vacation.

There isn’t a one-size-fits-all way to implement an incentive travel program. If you polled 100 of the top-performing organizations that use this strategy regularly, you’d likely get 100 different plans.

Although the implementation varies, some underlying structures exist in every program.

The Foundation of Your Travel Program

If you’re going to create a travel incentive to motivate your team, you want to do it right. You should base much of the program on your goals and the desires of the participants.

For instance, knowing your team well helps you plan the best incentive travel that will motivate them.

Would they prefer something with ground transportation, like a mountain retreat and horseback riding? Or is the best way to increase sales an international travel destination in New Zealand?

Qualifying for the Trip

Once you decide on the reward, you can set a program design up with the necessary steps to qualify. The details are specific to your company’s goals. In general, employees or sales personnel must meet a predetermined business objective to qualify.

The trip includes everyone who met the goal. Those top employees are rewarded with a travel perk that combines team-building activities and networking with free time to enjoy their getaway.

Who Pays for What?

As far as the expenses go, your company planned the trip and set it up. Therefore, it should fund most or all of the cost.

However, this is where the price begins to add up. Some companies layer the cost of transportation into their program.

Top-sellers who earn a certain amount may get their airfare reimbursed, as an example. Or, you can branch out to your channel partners and see if they want to work with you to cover some of the travel expenses.

Overall, though, the majority of the expense should come from in-house. Building employee engagement with your sales team will be easier to target and control when you are the one setting the requirements.

Discover: 13 Corporate Retreat Locations in the U.S. Your Team is Sure to Love


5. How to Plan an Incentive Travel Program

Well-executed incentive programs have specific stages to them. When each stage is thoroughly designed and implemented, the return on your investment will be more than enough to make it worth every penny.

But again, the program has to be designed and rolled out correctly, or it won’t be maximized.

Stages of a Solid Incentive Travel Program

Whether you’re hiring an off-site event planner to work with you, or doing it all in-house, follow these steps as you design your program.

Make a Plan Based on Objectives

The initial stage is where you design the framework of your program. This part isn’t the meat and potatoes yet. It’s the recipe the participants will use to earn the reward.

First, decide what objectives you want to target.

Is there a new product your company is releasing? Can you tie an increase in sales for that product in with your overall business objectives? Or is there another goal you’d rather focus on?

Set the criteria using your business goals. Make sure the objectives are clearly delineated and understandable. If possible, use a legal team to help you.

You can decide whether to set individual or group goals. Then, develop your budget and a basic plan to take you into the next stage.

Build the Excitement With a Soft Launch

How will you spread the news to your team?

This is where the excitement begins to build.

Come up with a creative way to communicate the incentive to everyone. Include multiple forms, such as emails, social media posts, and info on your website.

Start by introducing the carrot (the trip) and a basic summary of how to qualify. You can get into the details later after everyone is buzzing with excitement about the trip.

Monitor and Confirm the Details

Let the participants know how you will track their performance and the results. This should be something that each individual can follow, too.

Keep the momentum going by communicating regularly with each person and the group as a whole. Set the tasks and tracking methods for unique and general goals.

When someone earns the trip, make sure you have all the registration details ready to send them. They’ll need to know how to book their transportation and what they’ll need for the getaway.

Before you pick the travel destination, take a look at our: Full Guide to Trip Risk Assessments to Keep Employees Safe


6. Resources You’ll Need to Plan the Trip

Every trip will be different, from the destination and timing to the people who get to go. But you can have some set resources under your belt to turn to for each sales incentive.

Planning Resources

Your planning resources should include a team that you work with within your business. They are part of the process from the start, helping you design the objectives and complete each step.

You’ll also need staffing or an event planner to coordinate the logistics.

A designated team can:

  • Communicate regularly with the destination management companies
  • Handle the entertainment and itinerary
  • Come up with meal plans

Booking Platforms

After you’ve assigned a team to the project, the next step is to choose a program that you can use to manage the resources and expenses. When it comes to negotiating rates for hotels and planning those details, Hotel Engine’s lodging platform is the preferred solution for thousands of companies worldwide.

The platform is an all-in-one for lodging planning. Managers set up the filters they want to allow staff to control, choose the itinerary and hotel, and monitor each person’s travel plans.

During or after the trip, report features make it simple to see budget breakdowns, edit payment methods, and much more.

Marketing the Event

If you already have an in-house marketing team, you can use them to build momentum and excitement. Otherwise, you’ll definitely want to invest in experts to handle this part for you.

Once you have a system that works, including social media advertisement, videos, and print media, you can use the same basic structure for each trip. Occasionally, you may need to tweak steps as new technology comes out.

For the most part, though, your marketing team should be able to insert the new information and destination, adjust the photos, and push out a terrific motivational tool.


Conclusion

Incentive travel is statistically shown to give businesses the best ROI from their retainment budget. As long as you put together your program with a strong foundation, you’ll be able to use the same structure for every trip.

With partners like Hotel Engine working with you to plan each getaway, you’ll get to enjoy the process and the vacation, too!

Join for free and discover why Hotel Engine is trusted by over 40,000 businesses.