Onsite Insight: Sports Incentives on the Rebound?

As companies start to allocate funds to incentives this year, will planners finally start to see a light at the end of the tunnel?

It has been eight years since I was last in Tampa Bay for a Super Bowl and as I headed back this past week, I found it humbling to think how much has changed in the world since the last time I was here to celebrate the NFL’s biggest day…

For most of us, the last few months have been a rough road. We have suffered through some of the most difficult periods ever to face our industry. This includes pretty much a complete shut down of travel right after 9-11 and two terrible recessions, in which companies tightened their spending. Unfortunately we are still in the midst of the most recent recession, and companies are being even more cautious about spending on our services this time around.

In my specific business niche with sports incentives, the good news is that I am finally starting to see companies allocate budgets for 2009; but there is a hovering sentiment of not wanting to be seen as spending frivolously or making unnecessary expenditures. To that end we can thank the media for blowing up the AIG incentive program story right after their bail out, just as the private jet industry can thank the automotive company heads for bringing their services to light when they flew down to Washington, hat in hands.

But despite all the hype and hesitation, the underlying problem remains that companies still need to spend on incentives to drive business, just as many companies still need to take private jets to cut travel times and foster schedules. And it can lead to detrimental under-performance when a company does not want to do these things—not for financial reasons, rather because it might look bad to the “outside” world.

As with most issues we face in our business, a lot of it is cyclical. There will be cut backs and belt tightening, but things will come back to normal as we continue to recover. As I mentioned earlier, we have started to see budgets appear and companies begin to spend in our little segment of the market. That is a very good sign of what my lie ahead in the next couple of years. We just have to batten down the hatches, focus on surviving in both the short- and long-term…and wait it out.

Of course this also got me thinking that there have also been some extremely positive things that have taken place in the world since the last time I was in Tampa Bay. This includes the election of the first African American president in the history of our great land. We can only hope that the president and his team will focus on pushing companies to spend and lend to stimulate our economy. That will be the needed ingredient to spark our specific business and the economy as a whole.

I know in my area things are starting to gain traction as I see companies starting to come out from under the rocks to book programs again. Our Super Bowl incentives were 20% off this year for the first time in 10 years, but even so, I am optimistic that in a year from now, we will be sitting in a much better place.