Inspiration vs. compensation
Why cash alone can’t buy commitment.
There’s a Seinfeld episode where Kramer outshines Jerry by giving Elaine the birthday gift she really wanted: a wooden bench. Jerry gave her cash. The bench won by a landslide.
It’s funny, but it also raises a real question: are people more inspired by something meaningful than by money itself?
Research suggests yes.
The science behind the wooden bench
Dr. Victoria Shaffer and Dr. Hal Arkes conducted a landmark study on employee motivation and rewards that explains this phenomenon perfectly.
While employees often say they want cash, their behavior tells a different story. Shaffer and Arkes identified what they called “preference reversal,” a psychological pattern where people claim to prefer one thing (cash) but are actually motivated by another (non-cash).
In other words, we’ll gladly take the cash, but we’ll work harder for the bench.
What the data says
Our latest global research shows the same pattern. Employees report being more inspired to work harder for non-cash rewards, like concert tickets or the newest tech items, than for cash alone.
And the effect holds true for sales people, too.
It’s not that cash doesn’t motivate; it’s that non-cash rewards create an emotional connection. They carry meaning, story, and memory: three things money rarely provides.
Evidence from the field
Our experience and our data consistently validate this finding.
Barry Danielson, Vice President of Decision Sciences at BI WORLDWIDE, has conducted multiple studies demonstrating the power of non-cash rewards.
“Numerous studies have shown that cash is not as effective in driving higher levels of performance as aspirational non-financial rewards such as merchandise, travel, and experiences.”
Across industries, non-cash rewards outperform cash in both engagement and long-term memory. People recall the trip, the experience, or the tangible item long after the check has been spent. That recall reinforces loyalty and performance.
Expanding the marketplace of motivation
Of course, not everyone wants a wooden bench. The secret lies in choice.
To inspire the widest range of employees, BI WORLDWIDE offers three diverse marketplaces filled with non-cash reward options. Our Merchandise Marketplace offers premium brands and top-tier items they’ll love. Our Experiences Marketplace helps send them on a trip of a lifetime with locations and experiences beyond their wildest dreams. And our Mastery Marketplace is filled with learning and development courses that get them excited about what they can accomplish.
When participants can choose something personal, it transforms a transaction into an experience.
The bottom line
Cash pays the bills. Experiences tell the story.
When companies balance monetary rewards with personalized, aspirational recognition, they don’t just compensate employees, they inspire them.
Give employees the opportunity to earn what they see as their wooden bench and watch performance soar.
Key takeaways:
- People claim to prefer cash but are more inspired by non-cash rewards.
- Non-cash rewards create emotional impact and long-term motivation.
- Research confirms that “preference reversal” drives stronger engagement.
- Choice amplifies meaning: the best rewards feel personal, not prescribed.
- Non-cash incentives like experiences and merchandise outperform cash across all roles.
Hear from our expert
Walter Ruckes, Vice President, Client Services