Ask Melanie Miller-Pusateri about the trends she sees affecting the incentive and motivation marketplace, and she’ll point out two in particular: The first is how clients are increasingly bringing what she calls a “commodity mindset” to their discussions about programs, and the second is how different aspects of social media are being incorporated into rewards, incentives, loyalty and engagement programs.
The commoditization thing, says the Senior Vice President at Frosch Rewards and Incentives, is somewhat conceptual and involves teaching clients the finer points of program design. “It’s a trend that was occurring while Amazon was in the marketplace and has now come to the forefront since Amazon left,” explains Miller-Pusateri. “We do a lot of points programs, and when clients come to us to plan their incentive point program budgets they mistakenly start at the end – they start by focusing solely on the cost of the program rewards. They want to run an incentive program for their dealer-distributors or their employees, for instance, and the first thing they talk about is the price of an iPod. So the conversation starts there, and somewhere during the process they start seeing the actual program itself as a commodity.” That, she says, is where things get off track, and clients start shopping providers to see who can give them the best price on an iPod or whatever product they’re looking at.
Turning that conversation around requires a sometimes difficult education process. “We have to educate the customer that the reward is just one component to the incentive or engagement process – and often not even the most important part,” Miller-Pusateri says. “There’s the technology platform, communication tools, reporting tools and other services that we’re providing over and above the cost of the award – and there are the goals you want to achieve with your participants. Hopefully, by the end of the conversation, the client understands that it doesn’t matter what you spent for the iPod if you don’t create an effective program that meets your goals and gets a return on that investment.”
That’s not to say rewards aren’t important. In fact, Amazon’s departure from the marketplace left Frosch with some holes to fill in its reward offerings – particularly on the lower-priced end. “We were a ‘direct connect’ with Amazon – using our own technology rather than a third party,” Miller-Pusateri says. “And when Amazon left, we were looking for someone who could consolidate the informational feed from all of the different suppliers we wanted to use – their data, images, pricing, descriptions and other data – into our system. The Universal Rewards Exchange has done that for us.”
She says that the URE is also helping to fill some of the holes in Frosch’s catalog since Amazon left – in particular, DVDs, Blu-Ray and video games. “[URE] actively sought out that provider and is working to fill other gaps through its partnerships with various vendors. They’ve been very proactive in helping us to fill those gaps.”
The second major trend that Miller-Pusateri sees is essentially a technology issue – incorporating social media tools that make sense in terms of participant communication and engagement into Frosch’s incentive program offerings. “Right now we’re in the process of developing what we call the Water Cooler component for our points program platform,” she says. “When I first started in this industry, the points program site was a very transactional experience. You went to the site to perform a transaction – to redeem your points and to place an order. Now we’re moving away from a transactional experience and making it more of an interactive experience.”
The new points program platform aims to foster a community by celebrating achievements and milestones and highlighting positive contributions to the organization. “Ultimately, clients will be able to use the Water Cooler as a company intranet – a communication and collaboration tool,” explains Miller-Pusateri. “Or, if the client already has a company internet, it can be used to build a community around the program and offer program-related information and content – a news feed, an e-newsletter, news about new items in the catalog, an optional leaderboard, employee spotlights, kudos from customers and a variety of other options.”
She adds that Frosch is also looking to develop a participant-driven communication element for a future version of the program, where participants can exchange messages, kudos, advice, or best practices.
Other trends that Miller-Pusateri sees in the incentive and motivation marketplace include the increasing use of individual travel awards, continuing acceptance of corporate social responsibility components in reward programs and a renewed focus on employee wellness.
“With layoffs and the current economic climate – leaving fewer people in many organizations to do more work – it’s really tough to get everyone out on a group travel incentive at the same time,” she says. “As a result, the individual travel packages we offer have become very attractive, and we think they’ll continue to be attractive.”
As for corporate social responsibility, Miller-Pusateri says Frosch is getting more requests for CSR components on the travel side, “and in our points programs, people have the option of donating their points to a charity – in some cases with the company matching that donation. That’s also something of a selling point for dealer-distributor programs where some dealers have a policy against accepting gifts for purchases. They can still continue in the program a lot of times because of that option.”
Miller-Pusateri sees a common thread in all of these trends that involves aligning the goals of incentive and motivation programs with the needs and aspirations of participants. “People have to come first,” she says, “It’s not the iPod.”
That’s a lesson that is reinforced by the Frosch corporate culture: “Even though we have 1,000 employees and offices all over the U.S.” Miller-Pusateri adds, “it’s a very family oriented culture, and everyone’s needs are treated with the same consideration and respect.”