Employee rewards are often used as a tool to incentivize and motivate employees, but are they all made equal? While some businesses swear by the power of rewards to improve employee engagement, others argue that they can be counterproductive or even harmful in some cases. Rewards can create a culture of entitlement or undermine intrinsic motivation, which can ultimately lead to decreased productivity and satisfaction. So, the question remains: are employee rewards all made equal, and if you are on a mission to inspire and motivate your people, which ones should you choose?The psychology of employee rewardsPsychologist BJ Fogg, the founder and director of the Behavior Design Lab at Stanford University, believes that 'nudges' which tap into people's emotions underpin habit formation. In his Ted Talk he explains, "When I teach people about human behavior, I boil it down to three words: Emotions create habits. Not repetition. Not frequency. Not fairy dust. Emotions. When you are designing for habit formation — for yourself, or for someone else — you are really designing for emotions.” And employee rewards can play a key part in creating those essential feel-good emotions. But it does depend how, and what, you are offering, says Dr. Peter Hovard, Lead Behavioral Scientist, Global Data and Analytics, at Reinsurance Group of America, Incorporated (RGA). Peter is at the forefront of understanding the science behind healthy behavior change – and has been studying the makeup of successful health and wellbeing apps. "If you think about what an app does in other sectors, often it's about instant gratification," he explains. "With social media, for example, you're on there to fulfill a need to connect with other people, which happens instantly. Whereas what you're trying to do with a wellness app is motivate a behavior that happens sometime in the future. It's a lot of effort in terms of time: exercise, for a lot of people, is quite a challenge.”Motivating people through an app can be difficult because people don’t instantly experience the benefits of exercise. “So one thing that technology can do is bring the rewards into the present,” Hovard explains. “As long as people genuinely feel rewarded for their behavior, that can be quite effective.”But not all wellness apps are equal: “Our research has found that apps which use certain recognized techniques are not only more likely to change people's behavior, but they're also more likely to get people engaged,” Hovard says. “So it kills two birds with one stone.”Different rewards work for different peopleSuccessful apps incorporate goal-setting feedback, coupled with rewards. "Rewards are the big, big thing,” Hovard says. “Technology needs to reward people in different ways. You could see a reward as, for example, getting a badge in the app. Or you could be rewarded financially.” 1. Financial rewardsProviding financial support doesn’t have to come in the form of a pay raise. Reward currency that can be spent on anything from fitness products at Garmin or FiiT, to clothes and homeware from Amazon and The Home Depot. Vouchers can be a great way to reward employees, as they give them the freedom to choose how they spend their reward. By offering vouchers for a range of products or services, employees have the opportunity to either treat themselves and their families or use it to help shoulder the cost on something practical. This type of bonus has been shown to increase motivation and productivity over time.2. Donating to charityWhether it’s feeding the hungry, providing access to clean water or helping clean the oceans, your people may feel best rewarded when they’re helping others. Promoting ESG in the workplace has been shown to boost employee wellbeing, productivity and retention. Donating to a charity on behalf of your team can be a meaningful and valuable way to recognize their hard work and contribution. It demonstrates that you not only value your employee but also value the causes they care about. This can create a sense of pride and satisfaction within your team and a shared sense of values.3. Discounts on technology, and moreTechnology is an essential tool for many employees, not only in the workplace but at home and in every facet of their lives. By offering discounts on the latest gadgets and devices you can help them stay ahead of the curve while increasing your own productivity.Check out YuLife’s full list of employee rewards.