The Incentive Research Foundation (IRF) recently published The Psychology of Points report.
The IRF survey found that respondents that work for organizations that use a points reward program (vs. no points program) report:
From IRF’s literature review and expert interviews, they found that points award participants
During IRF’s research, they considered whether working for an organization that uses a points reward program is associated with an employee’s overall satisfaction with the awards and recognition they receive and their preference to work for an employer that uses a redeemable points award program.
Overall, the research found points programs appear to reach employees beyond a transactional level.
Points earners perceive their awards as separate compensation and more as “a gift of appreciation.”
A large majority of respondents agreed with the following statements:
The science behind points program attractiveness draws from many aspects of psychology and behavioral science, yet IRF’s interviewees offered the most obvious explanations.
IRF experts speak to the wide scope of potential rewards and the numerous ways leaders from every part of an organization can leverage points programs to focus the power of recognition on their priorities.
It is also important to note, many interviewees noted that the reward itself does not matter as much as the recognition or the points themselves.
No matter what an employee redeems their points for, the true benefit of a points programs is an employee receives recognition, followed by the award of points, and from the reward itself.
Points programs may provide a compound psychological effect.
The range of redemption options and uses associated with points programs keeps the experience novel, preventing the effects of habituation and entitlement.
The anticipation of future reward spikes dopamine each time a person receives recognition and points, compounding the impact.
IRF’s findings suggest that organizations using points programs enjoy greater workforce motivation, engagement, and identification.
They cannot conclude that points programs cause better motivation, engagement, loyalty, and identification, but the correlations are strong and consistent. Greater recognition, appreciation, and awards should drive these outcomes.
Yes, for a variety of reasons.
79% of IRF’s survey respondents agree that they prefer to save their redeemable points to exchange for larger-dollar item(s).
It’s important to note, 58% also agree that they frequently redeem points for small-dollar items.
In fact, almost half of all respondents (49%) agree to both statements Most respondents like to redeem their points for hedonic and memorable items or experiences.
The Incentive Research Foundation study supports points-based recognition programs to be memorable and effective at motivating employees.
It also aligns with the latest behavioral science, which suggests unique compound benefits are achievable with points reward programs.
Their findings lead to the conclusion that adding points rewards to a broader incentive and reward program is a wise choice.