Many people believe that monetary incentives are the best way to motivate an individual, but research continues to prove otherwise. In the article ‘Question The Answer: Money Motivates But Tangibles Drive Performance’, the University of Chicago study highlights two interesting facts about monetary incentives.

1. 78% of the population said they would prefer to receive the cash value of the prize rather than the prize itself, however
2. The performance of the population was markedly better when the group was in pursuit of the non-cash, tangible incentive, an increase of almost 3 to 1.

One reason for the inconsistency between preference and performance has to do with the justifiability of the award for which participants are working towards. Non-cash, tangible incentives (i.e. merchandise & travel awards) are considered a luxury, a “splurge” that participants have trouble justifying its purchase. When given the ability to earn a merchandise or travel award in exchange for hard work, participants are able to “purchase” this luxury without any feelings of guilt. Thus, people are more likely to expend extra effort since it’s likely to be the only way of obtaining it.

The following articles provide additional reasons for using Tangible Incentives vs. Cash. For additional information, contact an Incentive Services Sales Consultant.