Article - Question: Our objective is to build long term staff loyalty and increase sales. Should we focus on developing an incentive program over a prolonged period?

Andrew Cook replies: If you are looking to develop any kind of annual loyalty program be it internally as a staff incentive or indeed for your trade partners it is all too easy to focus purely on long term objectives.

The key to a successful long-term incentive program is to create and maintain a high level of interest. But, if it is too long it becomes laboured, interest levels drop, people become de-motivated and ultimately reject it.

Spread rewards over a period of time - incentives that are targeted periodically are more effective in driving success. Monthly rewards work well as a trade incentive, ensuring a constant level of sales and a reduced risk of loosing revenue in the short-term. Underpin this with several mini incentives over a 4 week period and you have a much stronger incentive.

The solution to longer-term loyalty incentive schemes is to develop a program that motivates and rewards performance both in the short and long term. A system of smaller prizes on a more targeted basis for the top performing staff with an overall target aimed at the most successful person of the year keeps a scheme ‘alive’ securing that all important long-term loyalty.

Cash isn’t always the biggest incentive. If you understand what drives people’s aspirations a combination ‘experiences’ can be a real winner. Dinner for two in Paris on Valentine’s night with accommodation at a top hotel probably won’t cost more than a £1,000, yet this has far more perceived value than the cash equivalent, especially if the incentive fulfils the prize-winners aspirations. Therefore if used tactically ‘experiences’ can be extremely effective at building loyalty – don’t forget the memory will always last longer than the cash.

ENDS

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