Rewards are crucial in motivating and retaining employees. Many employers see monetary rewards such as salary raises, cash bonuses, stock options, and profit-sharing as the best incentives. While it is assumed that employees want cash rewards, they often show greater enthusiasm toward non-monetary incentives. That is why having the right reward strategy is essential for employee engagement and retention.
Money is not the only motivational factor for employees. A recent study showed that 79% of employees quit their jobs not because of money but because of a lack of appreciation. A study by the Incentive Research Federation reveals that 80% of top performers prefer incentive travel and experiences, not cash.
Organizations must include monetary and non-monetary incentives as employees have different preferences. Age, personality, and income differences all play a role in the rewards employees want.
For example, younger workers prefer experiences like travel or concerts over material things. Older employees may be happier with practical items for their homes or car. Extroverts like social rewards like a group movie night, while introverts enjoy more solo experiences like a spa voucher. Living wage workers would rather have a simple cash bonus, whereas senior managers will be excited about club membership.
While it is easy to make assumptions about what employees want, it is best to ask them. Tailored employee rewards are a better alternative to a one-size-fits-all rewards package. Employees prefer flexibility and personalization when it comes to rewards. Offer a variety of incentives and ideally give employees the choice of which reward to claim.
You can use software where employees can select from a catalog of rewards. You can also give them lifestyle spending accounts, assigning amounts to specific spending categories. For example, you can offer a $200 monthly stipend on health and wellness and let employees choose where to spend it on the fitness club, organic store, or health app of their choice.
So, why do tailored rewards work? Employees want choice, variety, and personalization for these reasons:
Tailored rewards are more valuable, meaningful, and exciting. Feeling that they are treated and respected as individuals is highly motivating. Incentives that resonate with them are what will engage employees and what will drive their performance.
There are numerous kinds of non-financial incentives you can offer your employees. They can be grouped into five categories: recognition, tangible rewards, experiential rewards, opportunity, and flexibility.
Many employees want to be acknowledged and appreciated for their work, which is all the reward they need. These are some examples:
These are usually items that employees would consider treats or even small luxuries. You can give away:
Enjoyment over experiences lasts longer than material things. That is why experiential rewards are popular among employees. These are some ideas:
Another way of rewarding employees is by giving them opportunities to grow in their careers by investing in their professional development. You can do this through:
Employees consider flexibility at work a huge perk. Some things you can offer:
You must reward in the right form. If you give an incentive that is not exciting or relevant for employees, don’t expect them to get or stay motivated. People prefer different rewards. But you also must reward in the right way. Employees want flexibility and personalization when it comes to rewards. Offer a variety of incentives and ideally give employees the choice of which reward to claim.
Offering customized reward catalogs can be complicated to set up and administer. Consider working with a partner that will make it easier for you to provide tailored rewards. WorkProud can help you create digital employee experiences that unify various employee reward and recognition programs and processes under a unified platform.
Contact us below about customizing your reward program.
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Every month, we share news, knowledge, and insight into what we believe is a pretty simple proposition: If you are “proud of your work and proud of your company,” you are more engaged, more productive, and more likely to stay with your company for the long haul.