Cash vs. Non-Cash Incentives


Cash or cash equivalents, travel, merchandise and recognition are routinely used to drive new or different behaviors. Each tool triggers distinct feelings and reactions. Each has a distinct strength and weakness, which has to be considered when building a motivational structure.

The Desirability of Incentives

Numerous surveys and studies have been conducted in the effort to identify which rewards people want "most". While the list below reflects the kinds of incentives people commonly say they want (which should indicate the rewards that elicit the greatest motivation), we've found that the effectiveness of rewards varies considerably.

Incentives in Order of Desirability

  • Brand name merchandise
  • Cash
  • Travel
  • Gift cards/Stored value cards
  • Recognition items

Cash or gift cards are easily understood and universally accepted. They have an immediate gratifying impact but little or no lasting trophy value. Travel sets high expectations, has a trophy and memory value and frequently enrolls spouses or others into the motivational process. Merchandise, both high and low value, allows each individual to set their own targets and has the longest sustained trophy value.

On the flip side, cash is quickly spent--often on routine bills--and quickly forgotten. Travel is only as good as the actual experience and merchandise can break, go out of fashion or reach a point of diminishing returns in the minds of recipients. The ideal program understands the stimulus and response value of each tool and incorporates many tools to account for the different psychological buttons they push. Similarly, a well constructed program offers enough enticing reward choices to encourage each individual to set their own preferences.

The Strengths of Non-Cash Programs

  • Motivate specific behavior
  • Build teamwork
  • Enable on-going measurement
    and insight
  • Establish a unique
    competitive advantage
  • Provide lasting trophy value and
    linkage to achievement
  • Improve teamwork
  • Improve administrative efficiency
  • Increase ROI and profitability

The Limitations of Cash Rewards

  • Salespeople earn commissions
  • Cash doesn’t add motivation
  • Cash pays routine bills
  • Cash has no trophy value
  • Cash is forgotten after it's spent and sustains little, if any, association with achievements


01. Understanding Channel management Managing a winning channel incentive program is challenging and requires patience. Find out what the building blocks of a successful program are.
02. Do Channel Incentive Programs Pay Off? Learn how channel programs can help you make the most out of your partnerships and yield lucrative ROIs
03. Channel Incentive Program Objectives and Applications Learn how your program goals and objectives will define your program design and guide you along the way.
04. Channel Incentive Program Application Examples These case studies showcase how companies are successfully using channel incentive programs.
05. The Psychology of Incentives and Motivation Get to know your audience and how do you go about designing a program that speaks to participants’ values?
06. Cash vs. Non-Cash Incentives Cash always seems like an attractive reward. But does it carry the same long-lasting trophy value?
07. Points-Based Incentive Programs Why choose a points-based program? It allows for a flexible structure, and, most importantly, it is measurable.
08. Point Program Participant Segments / Personas After enrolling in a program, participants assume different personas. Explore the various persona types.
09. Incentive Program Study and Benchmarks Compare your initiative program with industry benchmarks.
10. Incentive Program Performance Indicators A look at channel incentive program KPIs and redemption rates.
11. Channel Incentive Program Best Practices A list of best practices that will aid you in launching and maintaining a successful program.
12. Program Considerations and Conclusions Before embarking on a program take these final considerations into account.