by Lisa A. Grimaldi | February 23, 2017
Incentive professionals are moderately optimistic about the effect the economy will have on the industry, according to the Incentive Research Foundation's IRF 2017 Outlook Study, an analysis of how incentive, rewards and recognition programs are being designed and budgeted for in 2017. The study, conducted last fall and based on the responses of 250 suppliers, corporate end users and incentive-house professionals, marked the first IRF use of the "Economic Net Optimism Score," a metric that tracks perceptions of the economy.
"The IRF has tracked the vitality and variability in the incentive, rewards and recognition market for almost 10 years," said IRF president Melissa Van Dyke. "The IRF 2017 Outlook Study not only provides up-to-date industry data, it also puts this year's findings in a historical and cyclical context, so we can deliver a big-picture view of the industry."
The score is based on the percentage of people providing a positive rating, subtracted from the percent giving a negative rating, where a higher positive score indicates optimism in the industry; the metric is similar to the Net Promoter Score management tool used to gauge the loyalty of a firm's customer relationships. Analysis shows that the net optimism score within the incentive travel industry tracks closely with overall U.S. economic performance, often acting as a leading indicator. The following findings were revealed via the new scoring metric:
• The Economic Net Optimism Score for fall 2016 is 26 percent, reflecting the incentive-travel industry's moderate optimism about the economy and its impact on the industry. This is down from a recent high trend surpassing 50 percent that began in fall 2013, but continues to outperform the extreme dips seen in 2009 and 2011.
• There is a strong positive outlook for budget increases in incentive travel programs -- overall and for F&B and rooms. More than half of respondents agree that costs are increasing more than budgets. The study also found that the most commonly selected destinations for incentive group travel are the United States, the Caribbean, Mexico and Europe.
The full study can be viewed here.