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June 10, 2014

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Companies seek to motivate employees through incentive travel

INCENTIVE travel, once upon a time, was a new concept to companies in China. Now it is gaining popularity among corporations in Shanghai to motivate employees and reward those for exceptional performance and enhance their loyalty.

Private and foreign-funded companies in Shanghai, particularly those selling fast-moving consumer goods, are major incentive travel customers, said Chen Ping, director of the Shanghai International Conference Management Organization.

The US, Australia, Hong Kong and Macau are some of the most popular destinations for companies in Shanghai that want to boost profit and lift employees’ loyalty through incentive trips, Chen said.

Zhou Weihong, who is in charge of incentive trips with Shanghai Spring International Travel Service (Group) Co Ltd, said groups on incentive trips dropped in the past two years because of the GSK case, a curb in excessive spending on vehicles, overseas trips and official receptions, along with the global economic downturn.

Last July, GSK and a spate of medical firms were accused of bribing officials and doctors to boost sales and fix prices of their medicines.

However, demand for the trips started to rebound in October and foreign-funded and private enterprises, particularly in the insurance and direct selling sectors, are major clients, Zhou said.

Wang Wei, deputy general manager of the outbound tour center of Shanghai China Travel International Ltd, said the US, Europe and Australia are popular destinations for incentive travel.

“Companies prefer cities with convenient transportation, lots of hotel choices and good safety records when they pick a place for incentive travel,” he said.

Cruise ships are another option for incentive travel groups.

Royal Caribbean International has two cruise ships with Shanghai as home port. It said they started receiving incentive travel groups in 2009. Most companies booking cruise trips are in areas like insurance, cosmetics, health products, clothing and fast-moving consumer goods.

Theaters, conference rooms, along with sports facilities like rock climbing and basketball courts make cruise ships suitable for companies interesting in hosting award ceremonies, banquets and team building activities, Royal Caribbean said.

“Starting last year, companies booking incentive trips became interested in high-end resorts in neighboring Zhejiang and Jiangsu provinces,” Zhou from Shanghai Spring said.

These five-star hotels and resorts are suitable for team-building activities, Zhou said.

Incentive trip groups can be big, sometimes comprising several thousand people. However, companies often choose to break big groups into smaller groups and take the trip at different times. The concern is that if a group is too big, the cost will be high, it may risk the company’s work, she said.

Travel agencies can spend up to a year negotiating with companies to prepare such trips.

It takes time to understand what clients want, their company culture, budget and purpose for the trip.

Wang from Shanghai China Travel said they need to provide a detailed proposal, which will, in some cases, be adjusted by clients before a trip is finalized.

Safety concern

Nowadays, traveling overseas is fairly common, thus companies planning incentive trips want to provide a new experience for their employees, many of whom may have already visited the destination. Companies also believe China-based travel agencies may not be too familiar with overseas destinations, thus they often turn to agencies abroad to help plan such trips.

Chen from Shanghai International Conference Management Organization said companies sometimes pay travel agencies to handle visas and air tickets, and may hire separate companies to plan their schedule.

“A major challenge is trying to improve the proficiency of local companies when they plan incentive trips,” Chen said.

Zhou from Shanghai Spring said one of the challenges is that political situations change frequently in some destination countries like Thailand, the Philippines and Vietnam. “It’s very unpredictable,” Zhou said.

During the recent anti-China riots in Vietnam, there was an incentive travel group of nearly 40 people in the country. They had only been in Vietnam a short time when the riot occurred.

“I was very concerned about their safety and kept in close contact with them,” she said.

Unexpected political incidents can delay a return, but it is worse for incentive travel groups because they usually need to get back to work. Thus, travel agencies need to use good judgment in such situations, Zhou said.

Sixteen business travel operators from nine tourist destinations in Australia including Sydney, the Gold Coast and Perth promoted incentive trips during the Business Events Australia North Asia Showcase 2014 in Shanghai recently.

BridgeClimb Sydney, a company organizing climbs on the iconic Sydney Harbour Bridge, has planned a number of activities to attract Chinese incentive travel groups.

For the Qixi Festival, or Chinese Valentine’s Day, last year, it invited five Sydney-based Mandarin speaking couples to the summit of Sydney Harbour Bridge for a unique dawn climb “blessing.” One couple got engaged at the summit. At Chinese Lunar New Year this year, a gold and white Chinese Dragon scaled one of the bridge’s arches to welcome the Year of the Horse. The eye-catching Chinese dragon was manned by nine performers who gracefully twirled and swayed the mythological beast during its ascent.




 

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