One of the things we see all too often, particularly in telephone and door to door selling environments, is poorly designed sales incentive programs.
One of the things we see all too often, particularly in telephone and door to door selling environments, is poorly designed sales incentive programs. In sales there is a old saying that you are about as good as your last month, so why is it that we see so many incentive programs structured around the quarterly achievement of sales targets? If you are looking for consistency of performance, we recommend that you structure your sales targets around daily and weekly goals. Why so?……
Well let’s say I‘m working in a door to door or telephone selling role and for some reason I simply have a bad week. I may have been emotionally a bit down one day, had a day off sick, or simply been a bit out of my normal sales rhythm. In a telephone selling situation, I might even have had a couple of days where the call volumes were down or where call quality was less than optimal from a conversion potential perspective. Now, all of a sudden, in a monthly target scenario, I’m 7-10 days into my month and it is looking pretty difficult to hit my target.
So my mindset and application drop and whilst I may push myself for another week or so, if at some stage the monthly target looks unachievable, the business is highly likely to lose revenue I would normally convert, for every remaining day of the month from the “give up” point. In other words, I will be cruising through to next month, or in any case, until the next bonus period begins. In this context, the importance of structuring incentives in the form of short term runs, to maximise sales engagement, is self evident.
Whilst we are on the topic, the nature of the incentives themselves is also a key to optimising sales engagement. Our research shows that relatively small amounts of money can be attractive incentives for a significant percentage of sales people; and adding accelerators rewarding the consistent performance of those who back up day to day and week by week can be additionally effective.
In addition, non monetary incentives can be equally or even more highly valued depending on the individual. Gold Class movie tickets for two, dinner for two, accommodation vouchers, iTunes gift cards, major event tickets and the like are broadly highly valued as alternatives to monetary rewards. Having your Team Leaders, Coaches and Managers structure and set these incentive programs six to twelve months in advance negates the week to week, month to month grind of coming up with next week’s initiative every Friday afternoon.
In short, one of the great things about working in sales is that “every day is a new day and all bets are off”. No matter what happened yesterday, it is possible to start today refreshed, renewed and motivated to perform. Structuring short term incentives in a way which recognises this engenders engagement and optimises motivation.
Finally, we further encourage you to structure your incentives to recognise as many individuals as possible. Recognition systems which reward only the top one to three sales people with monotonous regularity act as demotivators for your all important solid and steady performers who deliver their personal target month in month out, but who fail to get recognised because they simply never appear in the top three.
We also implore you to think twice about how you use “public” leader boards and the like. Our surveying clearly shows that no-one enjoys being highlighted as a lowly performer. Put yourself in the position of the salesperson looking up at and / or walking past the leader board fifty times per day, to see your name at the bottom of the pile. Practices such as these motivate very few – but demotivate many. Self esteem and mindset can be very quickly eroded; but they are very very difficult to rebuild.
