Prevue asked Jim Schultenover, President of Krisam Group & Global Events Partners, for his thoughts on the trends revolving around incentive programs.
Q: Has the perception issue surrounding incentive programs lessened considerably from a year ago?
A: For our global customers, incentives made a strong comeback in late 2010 and 2011. We expect 2012 to continue that trend because the factors that drive incentives haven’t changed. Companies have the profitability to produce incentives but the great thing is that they are self-funding because the people who go had to achieve identifiable goals. Companies that do incentives feel they work and are essential for success.
Q: Is the concept of 5-diamond “luxury” coming back into vogue for incentives?
A: Luxury is acceptable, if sensible. There’s been a ‘reset’ in the expectations coming from the Great Recession. Before, nothing was too extravagant—now there is a new appreciation for group experiences. Rates are growing, along with bookings. The fastest REVPAR growth—rate and occupancy—has occurred, and will continue to occur in the Upper Upscale and Luxury Hotel segments.
Q: What can planners do to add value to incentives?
A: When it comes to Value Add our belief is to work with local experts as they have the relationships, connections and leverage to help a customer achieve their goals. It starts with how does the customer want to ‘reward’ their top producers? Your DMC and Hotel Partner can help you determine the right mix of activities to accomplish this. What is the mix of onsite versus offsite? Did the customer choose a sophisticated destination? Do they want more of a relaxing beach experience with spa and golf? Or more action with scuba diving?
Q: Are you witnessing more meetings during incentives?
A: Everyone seems to believe that a business component is here to stay as part of an incentive because it makes sense—as long as it doesn’t become too much a part of the program—because then it completely changes the dynamics of the idea of an ‘incentive’. But having senior management, in a friendly, positive environment alongside their top producers is a missed opportunity to not share their vision and direction for the future.
Q: How much does F&B play a role in incentive programs?
A: The American palate has become more sophisticated, and so have the expectations for incentive trips. That can mean local and seasonal foods, organic and certainly, creative concepts and presentations. Dine-arounds remain a part of the mix as well. Again, F&B has to complement the goals and tone of the incentive. And if the customer hosts an event at the Versailles Palace the expectation will probably be more formal than a beachside event.