WorldatWork has been tracking trends in employee recognition programs for several years, with reports released in 2002, 2003, 2005, 2008 and most recently in May 2011. According to their research, 86 percent of the companies which responded have recognition programs. The average percent of payroll budgeted for recognition is at 2 percent, down slightly from 2.7 percent in 2008, but still significant, despite the economy. And with good reason. Companies report that recognition programs boost employee satisfaction (71 percent), motivation (66 percent) and engagement (64 percent).
While rewards for length of service are still most prevalent, more companies are using awards as a form of recognition for outstanding effort or contributions to the organization—“above and beyond” performance awards were cited by 79 percent of the respondents. The WorldatWork survey indicates that more companies are opting for newer programs that can have a more direct impact on the bottom line. And that includes consideration of such things as engagement which leads to commitment and loyalty.
Jean Chen is the office manager at Crystal By Design in El Monte, CA, a supplier specializing in crystal and glass awards, trophies and gifts. Established in 1996, Crystal by Design is reported to be one of the most prominent crystal and glass award wholesalers in the country. Crystal by Design’s Products are handmade—designed in the U.S. and manufactured overseas.
“Recognition is a good way of keeping up morale within a company,” Chen notes. “Corporations have continued or strengthened their annual or quarterly award programs.”
But there have been some changes in practices that have been impacted by the economy, most notably a concern about costs and the impact on the bottom line of rewards.
Sherry Grabill is co-owner, along with Gordon Grabill, of AwardsMart in San Antonio, TX. Established in 1985, AwardsMart has grown from a 380 square-foot office to its current 4400 square-foot facility. Grabill notes that she has been seeing a tendency toward centralization of awards purchasing as buying decisions are increasingly being handled by the corporate office, rather than individual departments, divisions or locations of the company operating independently.
Despite some changes in practices though, as the WorldatWork survey indicates, demand is remaining steady. Those in the industry, in fact, point to a slight increase in demand.
Skip Landry is the owner of Accolades Awards & Engraving, San Antonio, TX. “During the downturn, our corporate awards were down, but it’s coming back,” says Landry, who notes that his customers’ orders are very stable.
Cole Bonham, the owner of Midwest Trophy & Engraving, Inc., in Overland Park, KS, has also noted an uptick. “I think it is slowly increasing,” he says.
Larger corporations drive the market, primarily based on volume. The largest buyer of awards will always be corporations, says Chen. “A lot of them prefer to come up with their own designs and place custom orders so that the award is unique to their company,” she notes. “We also see a lot of demand from civic and social organizations, sports teams, charities, etc.” The area of least demand, she says, is personal gifts. It is really all about quantity and that’s most likely to come from larger corporations.
AwardsMart’s Grabill says that in some cases she has noticed corporations ordering more than they have in the past. “They want to make sure that their employees are recognized,” she says. This is even more important during times where raises and promotions may not be as prevalent—or even possible.
Bonham agrees. “The hottest types of corporate award programs right now are employee recognition and employee-of-the-month programs,” he says. “I think they’re trying to motivate their employees in a time when the economy isn’t all that great and maybe sales aren’t great either—they’re trying to motivate people to do more.”
It’s almost a counter-trend, but Grabill notes that most of her customers tend to stay with the same awards from year to year. “Many customers are still doing plaques or acrylics,” she says. “They haven’t shifted to trying different products.”
Landry, though, has seen a steady decline in the number of plaques he sells. “Years ago plaques were king, but we’re selling a lot more glass and acrylic—probably eighty to ninety percent,” he says.
He does have customers that stay with the same type of award from year to year, but notes that more of his clients seem to be looking for something new. And, when they do, he says they tend to take a slight step upward in terms of the cost of the product.
Some, he notes, are moving away from traditional types of awards entirely and opting for more practical items. “Some of our companies are manufacturers, so they’ll give tools or flashlights and things like that,” he says.
Bonham has also noted an increased interest in nontraditional types of awards like this. He says that he is seeing an increase in the use of perpetual plaques, making it easier and more cost-effective for organizations to update them each year. Rather than having to send in the entire plaque, Midwest Trophy & Engraving can simply send them a plate to update the plaque. “It makes it a lot easier and we’ve done a lot of business with less hassle that way,” he says.
While much is the same in terms of the types of awards ordered, Chen says that one trend she’s been seeing is the demand for more awards with color. To meet the demand, Crystal by Design has incorporated some crystal awards with colored accents but, says Chen, “We have tried to refrain from using bright, gaudy colors or using color excessively.” While customers enjoy the uniqueness of a small area of color, they still prefer the classic look of clear crystal awards, she says. “This will probably never change. Since the recipient will keep the award for his or her lifetime, trendy awards will never be a huge seller. The best sellers will always have classic, clean designs.”
Another major trend that has impacted their business, says Grabill, is the Internet. “We’ve devoted a lot of time to our website,” she says. And it’s paid off. “We’ve seen our sales increase in some months from the web by as much as two hundred percent. Investing in the website has really been an asset for us.” While not everyone prefers to order online, just having that option can help and serve the needs of both those who want the convenience of shopping entirely online as well as those who want to get an idea of what may be available before they come into a store to actually “touch and feel” the products.
Bonham also points to the Internet as a trend that has impacted his business. “The biggest thing we’re doing right now is reaching out on the web by creating Facebook accounts, blog sites, etc.—social networking is free and it gets the word out there. It’s a great way to reach your target market without a large advertising expense.” In fact, he says, he’s thought about dropping out of the traditional phonebook entirely in favor of online options.
It’s All About Service
While it might appear that the award itself is the most important aspect of building a strong business among corporate or other clients, those in the business note that this is surprisingly not necessarily true.
“The biggest key in this industry is customer service and time frame,” says Bonham. “I think everyone would agree that people want it now. If you can meet that with high standards and good customer service, you’ll be okay.”
Grabill notes that the products themselves do not vary much from one retailer to another. It’s the service that is provided to the customer that differentiates one retailer from another, she says. Sometimes even seemingly minor things can make a big difference in terms of the perception a customer has about the company they’re working with, such as how the awards are packaged and how they arrive. “If you’re shipping recognition products out in a box that looks like it’s been recycled four times, that’s not going to make a good impression,” she notes.
Added touches count, she says. “Do you give them what they ordered or do you give them more than what they expected to get?” At AwardsMart, for instance, a value-added service that they provide is a presentation guide to help customers present the awards most effectively. “Many times they forget all of the important information about the recipient, so we’ve produced a guideline that gives them some pointers on what details to remember and how to word the presentation,” she says. It’s that kind of added touch that can really make one retailer stand out from another.
Helping customers make their award choices can also be a valued service. While many continue to use the same type of award from year to year and others may have a solid idea of what they want, many really have no idea that they have to make decisions not only about the type of award, but perhaps the type of material, the type of wood, the type of nameplate, the font for the message, etc. “I try to make them feel at ease because sometimes they become overwhelmed,” says Grabill. “We go through a series of questions with them, but try not to make it feel like we’re drilling them.”
Chen agrees that it’s all about service. “The best advice that we will probably always give is to offer the best service possible,” she says. Her advice for retailers: “In the awards industry we thrive on repeat business, so if they put themselves in the customers’ shoes and go above and beyond, they will have a customer for life and will generate even more business from referrals.” And that is good advice in today’s corporate climate.
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