What Did You Get in Your Stocking?

Happy New Year!

What did you get for Christmas this year.  If the trend follows the past few years, most folks received some kind of gift card?  In fact Gift cards again were the #1 item given as presents this year.

The reason is simple. They offer a better value and better choice than anything.  People love them because they can now shop for exactly what they want. 

The same reason gift cards are so loved as Christmas presents applies to employee awards all during the year. 

Be well, be happy, hug someone!

Employee Recognition Awards and Employee Engagement-Think Ahead

As this year comes to a close and you're doing your planning for next year, it might benefit you to think about recognition awards as a tool to improve morale, improve performance, and improve the motivation of employees.

There are a lot of articles out there that speak of disgruntled employees, low morale, and the fact that many folks will be looking for new jobs as soon as the recession lifts.  Unfortunately, at that time companies won't be losing marginal employees, they will be losing their best ones.

Employee recognition is an integral piece of the employee engagement puzzle.  Recognition doesn't always have to include an award, but when it does try to put yourself in the shoes of the employee.  Let them the award that they want, the one that ensures that what they get fits their personal lifestyle.  For an article that addresses employee award systems and how they can be used to drive performformance click here.

Be well, be happy, hug someone!

Taxing Gift Cards as Employee Awards

For years, the traditional merchandise award companies have used the Tax issue as one of the top two main reasons you shouldn't use gift cards as employee recognition of service or safety awards.  One of them even goes on to say that the tax benefits of a qualified non-cash Length of Service or Safety program offer a 4:1 ROI over cash, gift card and travel incentives.  Gift cards are certainly taxable in a qualified program, however, what tey don't  tell you is that to qualify you can only give 10% of your people an award, and if you give more of them an award, it's all taxable.

Fine print?  Maybe, but these companies are less than ingenuous in their sales copy.  The 4:1 ROI is frankly laughable as well.  In using that erroneous number they just don't use apples and apples, or they aren't very good at math!  The simple fact is that a gift eertificate will be exchanged for an item of award at the fair market value of that award, and often the item is on sale...especially in these troubled times.  The merchandise items in the very limited award selections of those traditional merchandise suppliers is higher than suggested retail, and often much higher...in fact you wouldn't believe HOW MUCH HIGHER!!  We've done comparison after comparison on these types of programs have seen averages at least 50% higher than retail which simply means that the most popular items redeemed would easily be over 100% higher.  If these companies would be honest enough to show you that, the 4:1 ROI would fall apart and they'd be lucky to show a 1:1! 

Be well, be happy, and Hug Someone!

Do Gift Cards Have Trophy Value?

I saw a recent post on Linkedin where the individual stated that gift cards have limited value with respect to the other benefits associated with recognition awards.  He was speaking about the lack of trophy value of the award and the fact that once an item is purchased it isn't a reminder of recognition by the company.  Frankly I've heard this hogwash for years, it is an argument foisted on incentive and award buyers by companies selling high priced incentive merchandise or promotional products who are afraid of gift cards and the value and choice associated with them.  There is simply no empirical or scientific eveidence to support that conclusion.  Do they really think that a TV purchased at Best Buy with a gift card given in recognition of performance is not the same as a TV ordered through an incentive company's catalog or merchandise group?  That reasoning is so flawed it is foolish to think that any rationale person would believe it...but unfortunately many do.  Gift cards have become the #1 award in the incentive industry because they offer the best value and choice of any award.  Nothing else even comes close.  To review a paper on the subject that was published in WorkSpan, the monthly publication of the prestigious WorldatWork organization, click here. 

Measuring the Success of a Recognition or Reward Program

It has always puzzled me why companies don't make more of an effort to measure the success of their employee recognition and rewards programs.  There was an interesting article on this subject posted on WorkSpan Weekly, a news and resources newsletter from WorldatWork.  Click here to review this short article, we think you'll find it interesting.

http://www.worldatwork.org/waw/adimComment?id=35473

What's at the Mall?

Ever take a look at the different types of stores at the mall?  I did a quick and very unsophisticated analysis of stores at malls and came up with a very unscientific finding.  I chose the largest mall in the country, the Mall of America just outside of Minneapolis.   It has over 520 specialty stores, and 4 department stores.  The majority of the merchandise items (over 50%) in the department stores are some type of wearing apparel.  Of the 520 specialty stores, the vast majority of those stores are some type of wearing apparel.

So, where am I going with this??  It would seem that more than 50% of all the items we can find in a mall are wearing apparel.  Why?  Because that's what the folks want to shop for.  If they didn't, do you think there would be that many apparel stores there in the first place?

My point....take a look at the absolutely, most complete, largest, and best collection of merchandise items in the largest offering of any incentive company in the incentive industry and find the wearing apparel.  If you're lucky you may find 2% is in clothing.  If that's what America wants, and America is who is participating in the recognition and reward programs in this country, shouldn't those programs have clothing in them?  At least 25%? 

Programs that contain a wide array of gift cards as choices have virtually all the wearing apparel contained in malls, because all those stores have gift cards.  Doesn't it just make sense to have these gift cards in your programs if that is what your people want?

Shame on the merchandise incentive supplier for duping the business world into thinking that their merchandise collection contain the items that people really want.  Well, we know differently, don't we?

Our Choice of Gifts and Awards

There is an interesting book written by Joel Waldfogel titled "Scroogenomics: Why You Shouldn't Buy Presents for the Holidays."  Dr. Waldfogel, a professor at the Wharton School of Business at the University of Pennsylvania, makes a case that most of the time we just aren't good at gift giving.  He points out that no one knows our needs, our likes and dislikes as well as we do.  And that when people buy stuff as presents, no matter how well intentioned, they "buy the wrong stuff."

Not surprisingly, parents, siblings and romantic partners are the most successful givers because they know us the most intimately.

With this in mind, how much different is it really when a company wants to give a gift to their employees.  Do they get it right often, some of the time, not much of the time?  The incentive industry prides itself on providing tremendous choice in there employee recognition awards.  But is that choice real, or imagined because of the way the award companies confine their selections to only a few items or groups of items?  How many employee recognition awards are hidden away in a drawer, or regifted, or sold on ebay? 

Dr. Waldfogel points out that an option of many gift cards is a great alternative to choosing the award or group of awards yourself.  It's not surprising that gift cards have become the undisputed #1 award in the industry.  If you don't have them as options in your recognition or service awards, you may want to take a look at how easy they are to use.