The Perfect Rewards and Incentives Program
Rewards. Incentives. "You dun good" happy-time present joys. Whatever you want to call them, reward items are a huge part of the promotional products industry, especially when included in some kind of incentives program. Motivating behavior with physical rewards is an age-old practice, dating back either to Santa Claus or prehistoric moms who really, really wanted Timmy to get off his CaveBox 360 and clean Saber-tooth Fluffy's Litterbox. Thousands of years and evolutionary steps later, their popularity and effectiveness has not waned. Client looking to motivate patients in a physical therapy facility? Rewards program. Warehouse needs to reduce incidents of employee accidents? Rewards program. Management looking to boost sales performance? Rewards program. You can see where this is going.
So what's the catch? Sadly, planning a rewards program is a little different than most other print or promotional jobs. You aren't just providing forms. You're not just trying to build brand awareness. You're trying to have a direct and measureable impact on human behavior. In some ways, awards programs are as much psychology as they are advertising. Thankfully, the cool thing about psychology (or behavioral psychology, at least) is that it's fairly straightforward and measurable, meaning its ideas are more based off Pavlov than Freud. To succeed with awards programs, all you need are a few sales points, a little knowledge of psychology, and a basic understanding of some great, gift-worthy products.
THE SALES SIDE
There are plenty of valid ways to approach selling rewards programs, but a good core argument to follow is this:
"IT'LL SAVE YOU MONEY"
If you can convince a client that your program will reduce costs, the sale should be a no-brainer. Take a safety incentive program, for example. A reduction in the cost and lost productivity from worker accidents will obviously result in money saved compared to the purchase of products. This money-saving line of reasoning, however, can more or less be applied to any rewards program. Employee retention (cost of searching, training and waiting for employees to get up to speed), sales ("Your sales team will make more if you're willing to spend X on rewards items") and even social media marketing ("Giving away a few dozen gift cards to people who join your Facebook will be more effective and significantly cheaper than that radio campaign you were planning") can all be reduced to "Spend a little, save a lot."
BONUS TIP: Have case studies and client testimonials handy. Saying a program will theoretically save money is one thing, but having historical proof is another.
THE PSYCHOLOGY SIDE
This angle is a little trickier. It will require some research if you want to get it right, but it's worth it for the chance to make yourself seem like an educated expert. When done properly, rewarding employees can be highly motivating and effective at teaching new habits or encouraging old ones, but there are a few catches.
Conditioning human behavior through reward is more complicated than most people realize. Giving a reward for the wrong reason, in the wrong way or even the wrong time, can actually reduce a person's enjoyment of a given task (See "Undermining children's intrinsic interest with extrinsic reward: A test of the 'overjustification' hypothesis," by Leper et al., or just Google "Overjustification Effect"). Essentially, if someone already has a high interest in a task, say painting for instance, providing a reward for completing that task can make it less fun and interesting because it's getting equated with work in the person's subconscious. The idea is that (for whatever reason) people associate rewards with work, and work is supposed to be something tedious and loathsome. Therefore, anything that gets rewarded must be work, and work is not supposed to be fun. So, when a person gets rewarded for doing something he or she already likes, the mind tells the person: "Hey! You were wrong this whole time. All that painting you've been doing wasn't actually fun—it was work in disguise!" There's more to it than that, involving concepts like cognitive dissonance and how the mind processes history both backward and forward instead of linearly, but that's the basic idea.
Does the overjustification effect then mean that all rewards programs are doomed to fail? Not even slightly. However, there are two critical takeaways that affect your planning of rewards programs:
1. If the program is designed to motivate a task participants have low-to-neutral interest in, there is no risk of overjustification. Getting salespeople to file reports on time, dockworkers to pick up their cigarette butts, whatever—if it's something people don't like doing, a rewards program has no risk of reducing enjoyment. The rewards program will have the expected effect of getting the task adopted and potentially enjoyed by participants.
2. If the program is designed to motivate a task participants have a high interest in, overjustification can become an issue. Reward thresholds that are too hard to reach or too few in number can feel exclusionary or demotivating, and can even damage participants' self-esteem and their faith in their abilities. (Think of that scene from "Glengarry Glen Ross" with Alec Baldwin screaming: "The leads are weak? You're weak!") On the other hand, rewards that are too easy to reach can drastically drop motivation and cause once-enjoyed tasks to become dreaded and commoditized (this is the heart of "overjustification," and was the primary finding of the Leper study). You need to find that happy middle of rewards planning right between too easy and too hard. Goals that are challenging, yet not impossible. Rewards that are plentiful, yet still exclusive. Competition that pushes the limits of performance, yet doesn't demoralize those who fail. It can be a tough balance to strike, and is worth discussing with your client when planning a program.
BONUS TIP: When in doubt, use surprise. According to Leper's Overjustification study, surprise rewards will always have a positive impact on motivation (at least when given out in plentiful number). The gains in motivation might be slight, but you'll avoid the risk of overjustification and always land on the positive end of motivation.
PRODUCTS
Any product is appropriate as an incentive item, but here's some advice on a few of the more common categories:
On High-quality Luxury Rewards, Such as Televisions or Electronics: They're a powerful way to create feelings of prestige and value. "Think of how many [people] would tell their friends and family that they got a new television because they exceeded expectations," said Billie Reise, director of marketing for Incentive Concepts, Maryland Heights, Mo. "Cash is forgettable. Giving an incentive will warrant years of enjoyment if you pick the right reward. The prize and the way it's delivered matter."
On Gift Cards: If you're having custom cards built, know that usage impacts design. "A lot of people think that all cards are created equal, but they're not," said Diane Morsch, director of sales and marketing for Bristol ID Technologies, Lima, N.Y. "How long are you going to be using these cards? Do you want them to be reused, or is it kind of like a one-time incentive? You may want something a little more durable if something is going to be used over and over." She also noted that custom shapes, how the card will be read (magnetic strips versus barcodes, etc.) and even how it will be displayed can impact card design as well.
On Trophies and Crystal Awards: "Selling awards differs from selling promotional products in a few important ways," said Chuck Dahlgren, president of Crystal D, St. Paul, Minn. "First, award sales do not follow the typical promotional products selling cycle that peaks during [the] third and fourth quarter[s]. On the contrary, most awards are bought, sold and delivered during [the] first and second quarter[s]. This means that the awards season is about to take off—if distributors want to sell awards they need to start prospecting now."
He continued, "Another key difference is that distributors can expect higher margins selling awards. The average margin for a crystal award can be as high as 40 percent-to-45 percent, while the average margin for a promotional product can be as low as 20 percent. This makes selling awards more lucrative for the distributor."
BONUS TIP: Access to an art department can help with small-business sales. "We're finding that some of the smaller retail establishments, like restaurants or [similar businesses] that want to get into an actual gift card as opposed to a paper certificate, may not have the in-house resources to do something really nice and upscale for their card," Morsch observed. "So some of our resellers enlist our help in the design of it. We do have an in-house graphic design department. They take care of the proofing and the technicalities once the orders come in, but they can also take care of the design of a piece."