by Pádraic Gilligan, Founder, SoolNua Marketing & Chief Marketing Officer, SITE
Incentive Travel Research
In the latest Incentive Travel Index1, buyers once again highlighted their preference for “new destinations not used before” as the top choice for future incentive programs, a trend that mirrors the results from 2023. This preference isn’t just a fleeting fancy—it was chosen twice as often as the next most popular option, “all-inclusive resorts.”
The message is clear: there’s a growing demand for fresh, unexplored destinations.
By delving deeper into the rankings, we can better understand the profile of these preferred destinations and, more importantly, why they’re gaining traction. The trend points towards more local or domestic destinations (net 27%)2 over long-haul options (net -4%). These favoured spots are unlikely to be urban (net -3%), or involve any type of cruise (all showing net negatives). However, destinations with resort infrastructure (net 35%) or those offering all-inclusive packages (net 29%) are gaining appeal.
This suggests that second or third-tier destinations with strong resort amenities and short connection times from major markets are poised for significant growth in the next 2-3 years.
The real question now is: what are these destinations doing to seize this opportunity?
Incentive Travel Opportunities for DMOs
Destination Marketing Organizations (DMOs), Convention & Visitors’ Bureaux (CVBs), and National Tourist Offices (NTOs) have long excelled in developing robust marketing strategies, sales channels, and benefit packages tailored for association conferences and city-wide events.
These efforts are not only effective but also highly measurable—most DMOs can easily calculate the financial ROI per conference delegate. DMOs are now going a step further by understanding and communicating the broader, more profound impacts of association events. Beyond economics, these gatherings contribute significantly to education, societal development, job creation, knowledge transfer, cultural enrichment, and more.
Despite this sophisticated understanding of the tangible and intangible benefits of association events, however, most DMOs have tended to ignore the incentive travel market and built little by way of outreach to a global market worth at least USD$116B, according to research from the Events Industry Council (EIC). The reasons for this are multifarious – market size and scale being one (incentive travel constitutes only 8% of total business events revenues) – but this latest ITI research surely sets out a new opportunity for close-by, 2nd and 3rd tier destinations with decent infrastructure that aren’t exactly over-run by association or city-wide events?
DMOs have work to do
To avail of this opportunity, however, DMOs have lots of work to do. At present they’re simply not regarded as influential or even relevant in the incentive travel supply chain. In SITE’s recent Incentive Travel & Motivational Events3 study, when asked where you go for new contacts or connections, corporate planners ranked DMOs 6th out of 8 possible options (industry trade shows ranked first by a long shot). Likewise, in ITI 2024 when asked if the presence of a good DMO is increasing in importance when it comes to destination selection, less than one fifth of the buyer respondents said that it was. When asked to rank the most useful support received from a DMO, 16% of buyer respondents stated that the question was “non applicable”.
There are, of course, a small number of DMOs for whom incentive travel is a priority market. These, by and large, are destinations with established incentive appeal, like Canada, Mexico, the Caribbean, Switzerland, Italy, Ireland and so on. If the global average for incentive travel is 8% of the total for all business events, these destinations are greatly exceeding this figure. For example, of the 167 DMOs who responded to ITI 2024, incentive travel constitutes 11% or more of the total business events revenues for three quarters of them. For 38% of them, incentive travel makes up a staggering 26% or more of their top line.
When asked how they market their destinations, these DMOs mention a broad range of sales and marketing activities from specialised collateral and destination videos to site visits and trade show / event attendance. The top actions, however, are quintessential face to face activities: attending business event industry trade shows (81%) and events specific to incentive travel (67%). This underscores the primary importance of relationships in incentive travel. It has always been so, and that’s not changing anytime soon, despite the rapid advances in technology.
And therein the bones of the roadmap for 2nd and 3rd tier destinations that would like to leverage the opportunity now available to them. Refine your brand value proposition into a compelling story for incentive travel professionals, take your story to IMEX and SITE and tell it with passion. That’s what St. John’s, Newfoundland did and, as a result, hosted a super-successful Incentive Summit Americas in July 2024.
You can be the next S. John’s!
Footnotes
- ITI 2024 launches on Monday, October 7 at IMEX America, Las Vegas. Results from previous editions may be found at Incentive Index. ↩︎
- The “net” score is calculated by subtracting the percentage who say the element is decreasing from the percentage who say it is increasing ↩︎
- This study was undertaken in Spring 2024 and captures the views of all 100 companies for whom incentive travel is a key element in their reward and recognition program. ↩︎