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Gift cards: A way to really engage your employees

How can you incentivize and reward employees in a way that is personalized and offers them freedom of choice ? An increasingly popular option is to run a gift card program, either to motivate people to hit targets or to reward them for succeeding with a difficult task.

A few complimentary words, or a congratulatory email, are good ways for managers to thank an employee for a job well done. But what more could they offer? For companies of all sizes, the answer is increasingly ‘a gift’ and, more precisely, ‘a gift card.’ Provided as a spontaneous reward, or as part of an incentive scheme to promote employee engagement and motivation, they offer a range of advantages. Cards can be personalized to suit the employee, and offer a degree of choice that makes them certain to be well-received. They are also an ideal way to bridge the age gaps in today’s multi-generational workforce.

Gift-card spending on the rise

Such is their popularity that 83% of U.S. corporations used gift and pre-paid cards for employee incentives in 2015, according to[1] Demand for cards was also reflected in a separate study which revealed that firms spent more on their gift programs in 2016, and that gift cards were the preferred form of reward at 67.7% – well ahead of second-favorite, apparel, at 40%[2]. Companies also gave cards out more often in 2016 – with the frequency rising by 37%. Widely used by large companies, the appeal of cards also extends to small and medium-sized enterprises. In a Sodexo study, SME leaders revealed that they planned to significantly increase spending on rewards that would improve employees’ work-life balance over a two-year period. There was a 15 percentage-point rise in those planning to reward employee performance with bonuses, vouchers and gift cards; and a 17-point rise in those intending to bring in schemes to increase employee purchasing power[3].

Benefits for corporations and SMEs

The flexibility of gift cards makes them ideal for all sizes of budgets. While research shows that larger companies can afford more lavish rewards, with the proportion of those handing out gifts worth more than $1,000 rising from 1.3% of the total to 6.2% from 2015-16, nearly 70% of gifts cost less than $100[4]. Along with major corporations, SMEs are also reaping the benefits of the gift-card phenomenon. Sodexo’s study found that 88% of SME leaders in seven countries noted an improvement in the general atmosphere at work after rewarding performance through bonuses and gift cards[5]. In addition, 71% of respondents said that their company’s revenue had increased and 72% noted a drop in absenteeism.

So, what’s the secret to a successful gift card program?

Put simply, it needs to tick three boxes – buy-in by employees, an element of surprise and a wide choice of gifts. For an incentive program, buy-in is best achieved when management clearly explains the overall objective to employees – and then involves them in setting the targets or KPIs that will lead to rewards. In addition, employee groups should be given a voice in the discussions about the type of gift cards being offered under the scheme.

Once the scheme is up and running, collecting employee feedback will also boost its effectiveness. By creating a feedback loop, the program will always stay relevant to people’s lifestyles and aspirations.

When it comes to selecting cards and rewards, the element of surprise is particularly valuable – because surprises live longer in the employee’s memory. In fact, an emerging market segment is known as ‘surprise and delight’ rewards, whose popularity is backed by scientific evidence. The so-called pleasure centers in the human brain react more strongly when the pleasures are unexpected, according to researchers in the United States.[6]

Finally, the choice of gift card has also become a particularly hot topic, given the demographics of today’s workforce. Key to the success of any scheme is the ability to offer a selection of gift cards that is broad enough to motivate employee with different ages and backgrounds. 

Bridging the generation gap

Indeed, with Millennials working alongside Baby Boomers, what kind of card appeals to both 18-year-olds and 68-year-olds? Studies in the U.S. have pointed to the growing popularity among Millennials of e-gift cards, which are easy to use and ideal for e-commerce, along with so-called ‘open-loop’ cards issued by major credit card companies that offer almost unlimited choice[7]. By contrast, studies indicate that older generations prefer the more personalized choice of a card attached to a particular retailer.

Aside from generational differences, a combination of Sodexo’s know-how and survey results[8] has identified very distinct employee profiles in a typical workforce. The range of profiles underlines the need for variety in benefits and gift solutions, in order to offer meaningful rewards.


[3] Quality of Life: a BIG asset for small business leaders — SODEXO benefits and rewards services – 2016 study
[5] Quality of Life: a BIG asset for small business leaders — SODEXO benefits and rewards services – 2016 study
[8] 2016 Sodexo Benefits & Rewards study involving 3,224 employees and 880 companies in the United States, India, France, Brazil and Poland



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