Rewards and Incentives Service Market Size, Share, Growth, And Industry Analysis by Type (Digital Rewards & Rewards in Kind) by Application (For Employees & For Customers) and Regional Forecast to 2032

Updated On: 02 September 2024

• 

  Request a Free Sample to learn more about this report

REWARDS AND INCENTIVES SERVICES MARKET REPORT OVERVIEW

The global Rewards and Incentives Service Market size was valued at USD 3.91 billion in 2023 and is anticipated to reach USD 9.23 billion by 2032, witnessing a CAGR of 8.9% during the forecast period.

Rewards are usually offered to workers as recognition for outstanding performance. A reward is an employee gift given to encourage them after hard work. This can also be defined as motivating those whose efforts were above average these are called as incentives. Both rewards and incentives are effective tools of motivation. They help in improving the work output of the employees and motivating them to do more than they could do otherwise. This system helps boost employee productivity while allowing them access to their full potential.

There are various factors driving the rewards and incentives service market growth such as, increasing demand from companies and attempting to provide friendly competition among employees. In the present time, there are numerous ways to administer and personalise rewards programs because of the emergence of digital platforms and mobile applications. Organisations are recognizing the strategic importance of effective rewards and incentives to attain corporate objectives hence this market keeps on expanding.

COVID-19 Impact: Work from Home Due to Lockdown Led To Decreased Demand

The COVID-19 pandemic has been unprecedented and staggering, with rewards and incentives service markets experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden rise in CAGR is attributable to the market’s growth and demand returning to pre-pandemic levels once the pandemic is over.

Since the outbreak of COVID 19 pandemics early 2020 serious disruptions have occurred in this industry mainly due to lockdown measures worldwide and increase in telecommuting which was responsible for reduced market demand. Many organizations suspended their traditional ways of rewarding towards retaining talent during the quarantine time. Companies were also forced into reducing their employee reward schemes owing to fiscal constraints and modifications in corporate priorities. However, digital reward solutions were adopted faster because of the crisis, focusing on e-gift cards and online experiences in order to keep employees engaged in a virtual setting.

LATEST TRENDS

"Personalized and Experimental Rewards is a Latest Trend "

Emerging as a key trend in rewards and incentives services market are personalized and experiential rewards. With data analytics increasingly being used by companies, customers’ preferences have been factored into their reward systems making them more relevant. Such organizations now offer things like wellness programs, virtual events or custom-made gifts that really connect with workers or buyers rather than generic incentives. This transformative process increases devotion as well as gratification thus connecting compensation to individual preference and movement; therefore producing high performance outputs for both holding-on and inspiration attempts in the end.

• 

  Request a Free Sample to learn more about this report

REWARDS AND INCENTIVES SERVICES MARKET SEGMENTATION

By type

Depending on the global rewards and incentives services market given are types: Digital Rewards & Rewards in Kind.

Digital Reward: The digital reward is the reward offered via digital platform. It uses a digital system to allocate and distribute rewards.

Rewards in Kind: These are the physical rewards which include gifts, merchandise and other things. Here you can also get vouchers or coupons.

By Application

The market is divided into For Employees & For Customers.

For Employees: Rewards and incentives in this section aim to inspire, acknowledge, and keep employees. Performance bonuses, milestone recognition programs, wellness incentives, and gifts to show appreciation to employees are some examples.

For Customers: This segment targets customer engagement and loyalty, offering rewards like loyalty points, referral bonuses, and special discounts. These programs are aimed at enhancing customer retention and driving repeat business.

DRIVING FACTORS

"Increasing Demand from Companies Drive Growth in Market"

The increasing demand from companies is one of the reasons driving the rewards and incentives services market growth. When businesses realise that employee engagement, motivation and retention critically matter, they invest in tailored rewards programs more often than not. These services are also being utilised by companies to improve loyalty among customers as well as increase sales. The growth of digital solutions, personalised rewards and wellness incentives is in line with the current workplace environment thus causing an expansion of the market even wider. In light of these observations; it can be concluded that there is a growing need for organisations to align their reward strategies so as to enhance overall performance.

"Attempting to Provide Friendly Competition Among Employees Increases the Market Demand"

Another important reason driving the market is the attempt to provide friendly competition among employees. In response to increasing productivity and engagement, an increasing number of organisations have implemented incentive plans aimed at promoting healthy competition among employees. They can motivate their workforce by giving them bonuses when they reach certain benchmarks or beat other companies; in this way, workers end up being pushed towards excellence because of the competitive atmosphere surrounding them. Better performance across the entire organisation is seen since the strategy enhances personal responsibility and group cooperation. In addition, it emphasises how important competitive rewards are becoming for driving growth in the marketplace.

RESTRAINING FACTORS

"Employee’s Changing Mindset to Work Only for Rewards Hamper the Market Growth"

One limiting factor affecting the rewards and incentives services is the employee’s changing mindset to work only for rewards.With incentives becoming more important to businesses, there’s an opportunity here that employees can miss if they concentrate too much on the reward itself. Job satisfaction might remain low for longer stretches despite previous moments of passion in what people do for a living. Additionally, this leads to a work environment characterized by transactions where personal development fails to find relevance amidst demanding organizational frameworks in which monetary figures often overshadow everything else including human dignity. In other words, it would take away from all types of program effectiveness over time.

• 

  Request a Free Sample to learn more about this report

REWARDS AND INCENTIVES SERVICES MARKET REGIONAL INSIGHTS

The market is primarily segregated into Europe, Latin America, Asia Pacific, North America and Middle East & Africa.

"North America to Dominate the Market due to Rapid Industrialization"

The market in North America is the most dominant region and largest market share as well as exhibiting very high profitability. North America is poised to dominate the market for reward and incentive services due to its fast pace of industrialization and a strong business culture that values high levels of employee involvement and customer fidelity. The rise in demand for new and individualized incentives has been driven by the strong economy in this region coupled with increased adoption of digital technologies.

KEY INDUSTRY PLAYERS

"Key Players Focus on Partnerships to Gain a Competitive Advantage "

The rewards and incentives services market is significantly influenced by key industry players that play a pivotal role in driving market dynamics and shaping consumer preferences. These key players possess extensive retail networks and online platforms, providing consumers with easy access to a wide variety of services options. Their strong global presence and brand recognition have contributed to increased consumer trust and loyalty, driving product adoption. The collective efforts of these major players significantly impact the competitive landscape and future trajectory of the market.

List of Market Players Profiled

• Rybbon (U.S.)
• Tremendous (U.S.)
• Tango Card (U.S.)
• Xoxoday (India)
• Giftbit (Canada)
• Blackhawk Network (U.S.)
• Gyft (First Data Corporation) (U.S.)
• eGifter (U.S.)
• Global Reward Solutions (Canada)
• Gravy Gifts (U.S.)
• Square (U.S.)
• Giftogram (U.S.)
• Knowband (India)
• Self-Service Networks (U.S.)
• HMI Performance Incentives (U.S.)

INDUSTRIAL DEVELOPMENT

June 2022: A partnership between Rybbon and Voxco was announced. The new partnership will offer digital incentives like Visa gift cards and e-gifts cards therefore increasing responses. Moreover, this collaboration will boost companies’ data collection and provide a seamless reward experience to the workers within the organisations.

REPORT COVERAGE

The study encompasses a comprehensive SWOT analysis and provides insights into future developments within the market. It examines various factors that contribute to the growth of the market, exploring a wide range of market categories and potential applications that may impact its trajectory in the coming years. The analysis takes into account both current trends and historical turning points, providing a holistic understanding of the market's components and identifying potential areas for growth.

The research report delves into market segmentation, utilizing both qualitative and quantitative research methods to provide a thorough analysis. It also evaluates the impact of financial and strategic perspectives on the market. Furthermore, the report presents national and regional assessments, considering the dominant forces of supply and demand that influence market growth. The competitive landscape is meticulously detailed, including market shares of significant competitors. The report incorporates novel research methodologies and player strategies tailored for the anticipated timeframe. Overall, it offers valuable and comprehensive insights into the market dynamics in a formal and easily understandable manner.