News Analysis: Incentive Travel Suppliers - It's Time to Pivot

Despite the latest Incentive Research Foundation study indicating that group incentive travel will resume in the second half of 2021, nobody really knows. This second IRF survey following the first Covid pulse survey already indicated a major increase in cancellations. There is no reason for despair, opportunities abound for those who can pivot.

 

By Bruce Bolger
 

The people who make their living primarily on incentive travel can hope for the best but should plan for a new world. Incentive travel will not go away, but the longer the pandemic endures, the greater the chances that it will go through a major transformation that will warrant a change in business models for many suppliers. Several major factors suggest that the number and nature of large groups could significantly change for years to come and that companies will likely regionalize and make more intimate the travel programs they maintain.  For those able to pivot, opportunities abound.

 

The Covid-19 pandemic has revealed an overwhelming sense of caution among the American public. While the 20% to 30% of the Americans who apparently do not care about the disease get the most media attention, the majority are cautious and have kept online shopping, take out restaurants, parks and golf courses busy, while leaving airline flights, trains, hotels and indoor restaurants relatively empty. 

 

Unless there is a highly successful vaccine in historic time, it’s likely that uncertainty related to outbreaks could go on for some time, with many people fearing the risk of getting sick or stranded far from home.  Given the lengthy lead times to plan for major events, many companies will have to think long and hard about making major commitments without very clear exit terms in their contracts. The IRF survey notwithstanding, it’s hard to logically foresee a significant resumption of large group trips until 2022, with the exception of full-resort occupancy or full-ship charters, which will probably be the first large programs to return.

 

Now is a good time for incentive travel suppliers to both take advantage of opportunities to pivot as well as try to anticipate what the business may look like after the pandemic is gone. 

 

Virtual communications strategies. In the short term, as the IRF survey points out, companies are moving to virtual meetings, and the opportunities here are enormous for creative companies. Virtual events are not just about Zoom meetings or licensing virtual trade show software, they are about choreographing a year-round digital relationship with people using a combination of media and interactive, small group programs. The best organizations will essentially create their own multi-media information channels with a schedule of live offerings and a library of on-demand options. These budgets may not be as large as group travel but are probably more profitable and less easy to commoditize. 

 

Other award options. As also indicated in the IRF study, merchandise, gift cards, digital and other reward experiences have prospered during Covid-19. The concept of spontaneous gifting, increasingly known as Surprise and Delight, will spread the gifting process out across the year and drive demand for more effective ways to manage and measure these activities.

 

Engagement technology and programs. With customers, supply chain partners, and employees all working at home, the drive to create a one-to-one digital connection will only intensify. Companies will be making a major investments in technology and the design of programs to engage people and measure the impact. 

 

More intimate travel experiences. While the use of group travel has diminished, the desire for regional experiences has exploded. Everywhere around the US, people are enjoying local parks, outdoor historic sites, golf courses, outdoor dining and picnicking and other activities in their region. Given that so many people are working in their homes, the opportunity to get away for a regional experience is even more appealing.

 

Those who believe that group travel will go away do not have history on their side. For many people, travel with their colleagues is a highlight of their professional lives. The ability to share social, enriching, or adventurous experiences with colleagues creates memories and relationships that last for years. At the same time, while the pandemic will probably only increase our desire for travel, dining and entertainment, it is also demonstrating that we don’t need to travel to attend valuable panel discussions or lectures with top experts; in fact, virtual panel discussions and talks are proving to be highly effective with a huge savings in terms of time and money for travel. It’s a safe bet that the longer the pandemic goes on, the more difficult it will be to justify travel to hear speeches and panel discussions.

 

In that vein, anticipate a new world in which companies use travel for what can’t be done in virtual meetings: to strengthen relationships through shared experiences, tighten bonds, and create unforgettable memories, and to teach and inform through doing and interacting rather than listening alone.