Do These 5 Things If You Develop a Sales Incentive Plan
by Nichole Gunn VP of MarketingSales incentives can be a great benefit to your department or organization. But there's danger in implementing them incorrectly. For instance, you may reward salespeople unfairly if their rewards are based on territory. Rewards may also cause salespeople to coast by once they earn them. To develop a sales incentive plan that works for your particular supply chain, follow these five guidelines:
Step 1: Analyze Your Sales to Focus Your Goals
Take a look at your current sales. Analyze sales by gross
numbers, product lines, profit margins, territories and sales reps. Rank each
of these categories in order of performance. This will help you determine where
your pain points are and what your incentive program targets should be. You
might discover, for instance, that much of your sales come from a single
product, so you may consider rewarding your sales teams and sales channel
partners for pushing out different products to increase your product mix. Offer
smaller rewards for low-margin products that are easier to sell and bigger
rewards for high-end items.
Step 2: Provide Exciting Rewards
The next step is to decide how you’re going to reward your
sales teams and partners. This is an important step. If you can’t offer
appealing rewards, no one will want to enroll in your program. Think about the
interests and needs of the typical salesperson you work with.
Cash is, of course, the easy answer, as cash can buy any
reward. But cash doesn’t make a statement. It doesn’t stand out apart from
other bonuses and commissions, and it doesn’t remind the recipient of your
company or their achievement. To make your reward program memorable and
engaging to participants, you can offer non-cash rewards through an online
rewards system.
Companies like Incentive Solutions offer millions of non-cash rewards, from HDTVs and tools to flight and event
tickets. These kinds of rewards are noteworthy conversation-starters. They will
get people talking about your reward program and inspire them to be more active
within it. With the promise of exciting rewards, your participants will be
frequently submitting new claims to save up for exciting items like a new grill
or patio furniture.
Step 3: Decide How You Will
Distribute Rewards
Start fresh with your reward system: focus on rewarding new
and increased sales, rather than for existing or ongoing achievements. This
will ensure new life is breathed into your sales numbers and start everyone off
on the same foot, encouraging low performers to excel and outperform those who
are usually the highest performers. You may want to consider offering tiered
rewards—for example, 500 points for the first $100 of a sale, 1,000 for going
over $100, 1,500 for going over $150, etc. This can inspire your teams to
make larger sales.
Another way to keep participants engaged is to use an
instantaneous system, so they don’t lose interest waiting to be rewarded for
their good deeds. Incentive Solutions online
reward technology allows you to reward your participants immediately with
points. This drives instant gratification and solidifies the connection between
the salesperson’s desired action and their reward. Those points then act just
like currency within an online
reward mall—they can be redeemed for any item in the catalog. Remember how
fun it was to go to the arcade as a kid and exchange your tickets for prizes
behind the booth? The points-based system works very similarly, only the prizes
are much better than just stuffed bears and keychains. When the reception and
redemption of points is easy and immediate, salespeople will be much more eager
to join your reward program.
Step 4: Distribute Rewards on an Even Playing Field
Determine how incentives can influence each salesperson or
channel partner. Is there a senior distributor in a prime territory with large
accounts who will earn rewards left and right, while smaller-scale partners
struggle to meet your program objectives? Strategize your rewards system so
that it isn’t skewed in favor of a few individuals or B2B sales partners. Make
sure your low-end and—most importantly—middling performers will be able to see
worth in joining your program. Your middle or average-performing salespeople
are usually those who have the most potential to grow, so motivate them to do
so! This is where your incentive program can really make a positive difference
in your sales numbers.
Step 5: Communicate
Clearly and Effectively
Communication, communication, communication! That’s the key
to getting your employees and sales channel partners to adopt your program and
stay involved. Make sure you clearly communicate to your participants what they
stand to gain from joining; otherwise, why would they bother? Make yourself
available to answer questions, create a FAQ section on your incentive program
website, and layout clear rules in the very beginning. Changing rules once the
program has already begun is likely to put off participants and reduce their
interest. Leave as little room for misunderstanding as possible, and gather
feedback to adjust and refine your goals to drive ROI and ensure your program
is even more effective in the future.
Incentive Solutions offers a communication package with every
reward program so that you have a useful, multichannel marketing and
communication tool that reaches participants through multiple mediums. Not
everyone is best reached the same way—a multichannel approach ensures you
communicate with as many participants as possible.
Following these five steps can help you avoid a host of common sales incentive program mistakes. Incentive programs are not one-size-fits-all solutions. A sales incentive program can help your sales team thrive and grow your profits, but only if you put time and attention into it from the start and tailor it to your organizational needs.
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Created on Sep 22nd 2020 08:35. Viewed 277 times.