Benefits of Incentive Travel for Employees and the Employer

Business owners often question how and why some businesses would spend money to take employees on a trip for pleasure. As a leader in a business, your most valuable assets is your employees and the more focused you can keep them on a shared goal the more likely you are to achieve that goal in the future. 

I’ve experienced first hand how implementing a reward/incentive travel plan for a sales team can not only increase sales but create loyalty and comraderie amongst coworkers.

Let me share a story…

Nearly twenty years ago I was working at a small 13 branch community bank as the marketing director. My team supported every area of the bank and we were unique in that our small community bank had a team of about 30 commission only mortgage loan officers.

If you’ve worked in the mortgage industry, you are aware that many times mortgage sales people can tend to be turnover and change jobs often. Commission sales are hard and it is a difficult profession to find long term success in. 

However, when you find the right types of people to work as a mortgage loan officer, you typically find hard working, rock star sales people who love to both help their clients and make lots of money. 

I worked closely with each of the mortgage officers to develop and implement a marketing plan as well as provide consistent follow up from their clients to “keep in touch” so that when mortgage rates dropped, it was an easy email or phone call to the mortgage officer to help that client again. 

Our mortgage division grew significantly to the point where they provided nearly 50% of the revenue to the bank in one year. 

The head of the mortgage department and I met often to discuss ways to help motivate and encourage all of our mortgage officers to take their business to the next level. 

One day I suggested creating a “Leaders Club” trip where we would take all the salespeople who reached our production goal on a week long trip to Mexico. All recipients would receive an all expenses paid, all inclusive trip to a beach resort on the Mexican Riviera for themselves and one guest. 

As a conservative bank, this was definitely outside of the box thinking and needed buy in from the top. We did our research, we looked at numbers and spreadsheets to justify it and luckily the executive team gave us the blessing to move forward with the trip. In past years, all we had done was organize a thank you dinner for the mortgage team and their spouses and we would handout trophies to those who had reached their goal.

We organized our normal annual dinner and at the end of the night, announced that for the next year, any mortgage loan officer who reached our production goal of $10 Million in Mortgage loans for the year would be eligible to join us on this trip. Most of the mortgage officers had production that ranged from $5-30 Million, so achieving a $10 Million mark was definitely achievable.

I can still remember everyone in the room getting excited. I’m pretty sure nearly every spouse of a mortgage officer gave a nudge to their loved one telling them they wanted to go on that trip. 

After that night, there was renewed excitement from each mortgage officer to meet with the marketing team and implement a plan that would help them make it on our trip scheduled for the coming winter. 

The support from their significant other was super helpful as well because most of our team members had a cheerleader at home to help them stay motivated and focused on our goal.

I don’t remember how many people ended up coming on our Leaders Club Trip the next year, but I do know that nearly all of the sales people had their production increase. The target that had been set helped everyone have something simple to focus on and overall production rose significantly because of it. 

What I don’t think we realized at the time of implementing the trip was the many other factors that came as a result of having an incentive travel plan for the sales team. 

Loyalty and Lowered Turnover

Our top producers who did come on the trip create friendships and bonds with other top producers. The turnover we saw in our top producing sales people dropped to nearly zero. It was amazing to see how such a simple thing like providing a trip that cost under $5,000 could motivate a person to stay at their job, even though they might have been unhappy or frustrated at the time. 

Many of those top producers continue to be employed in the same job today as they were in 15 years ago. They continue to produce, and given that it takes many months and often years to train a sales person to be effective, the value of that is likely 10 or 100 times the $5,000 that might have been spent on a reward for the employee and their spouse. 

Healthy Competition

The incentive vacation plan created healthy competition among the sales team and also created something that everyone could achieve together. When someone reached the goal, it was something that everyone celebrated.

Boosting Productivity

Even most of the lower performing sales people saw a life in productivity thanks to the goal setting that was provided to them at the beginning of the sales year. Not all employees make it as a sales person, but having a target set for being a “top producer” or “Leader” as we did made it much easier for new sales people to know what the bar would be for achieving success in their job role. 

Enhanced Learning

Another side benefit to providing our travel incentive was having our younger or lower performing producers work to achieve more. When the newer sales people were close or achieved the leaders club trip, they would get to spend time around the other top producers outside of work. This provided many learning opportunities for these newer individuals to watch what the top producers were doing and implement those habits into their business.

Feeling Appreciated

Travel creates memories and has a higher perceived value than cash. According to new research by Harvard Business School Assistant Professor Ashley V. Whillans. More than 80 percent of American employees say they do not feel recognized or rewarded, despite the fact that US companies are spending more than a fifth of their budgets on wages.

The study shows that what employees crave even more is to feel that their managers appreciate them and aren’t afraid to show it, not only in paycheck terms, but in other ways such as flexible work-at-home schedules, gift cards for pulling off impressive projects, or even just by saying “thank you” for a job well done.

“Cash matters in people’s lives, but it’s not all that matters,” says Whillans, who researches what makes people happy. “What really matters in the workplace is helping employees feel appreciated.”

Taking your top employees to a travel destination as a reward and a way to say thank is powerful. Just sending your employees on a trip by themselves is nice, but when the boss takes time to recognize you were special and to say thank you to both you and your significant other, that’s where the benefit kicks in… and what manager or boss doesn’t want to have an excuse to take a nice vacation each year. 

Whillans co-wrote a recent article in Compensation & Benefits Review, “Winning the War for Talent: Modern Motivational Methods for Attracting and Retaining Employees,” with Anais Thibault-Landry of the Université du Québec à Montréal and Allan Schweyer of the Incentive Research Foundation.

Cost-Effective ROI on Travel Rewards

If you work at a bank or a business that loves to show numbers to make every decision, there are many great case studies showing the ROI of providing a sales Incentive program. Here’s a list of several case studies and articles that might help you make a better case to your boss as to why they might want to look at implementing a corporate or employee reward system that includes travel for some or all of the employees.

• Incentive Research Foundation – ROI of Incentive Programs: Direct Sales Case Study
• Chief Marketer – Getting the ROI on Incentive Programs
• TheIncentiveReserchFoundation – Determining The Return On Investment Of Incentive Travel Programs
• How to Make the Case for Incentive Travel
• Why Incentive Travel Can Better the ROI of your Employee Incentives

How you structure your incentive programs is up to you, but if you’re looking for something that will have a lasting impact, a higher perceived value than cash and something that will help lower turnover of your top employees, don’t leave travel out of the mix. 

You’ll likely find that spending a few days with your top people to build a stronger bond and relationship will be what keeps them wanting to work for you, and that means more money in everyone’s pockets.