You're already struggling to apply sales incentives that work. Now you read that awarding a dream vacation to your top performers every year is probably the wrong approach. "But my people love that trip!" Of course, they do, but how many of them are effectively motivated by it?
Before you run off in the wrong direction on this subject, stop and consider the core reasons for awarding sales incentives. Ultimately, these are business tools designed to reward, motivate and change behavior. Learn which incentives do that for more than just a select few salespeople on your team, and you can design a program that works on a large scale to help increase sales.
What Is Your "Top Performer Trip" Accomplishing?
I'm sure there are hundreds of sales incentive programs out there featuring truly fantastic travel events for top performers. Those lucky few who make the trip enjoy a lifelong memory and are highly motivated to make it again next year. And yes, this very elite slice of the team represents your very highest performers, the ones who make a huge contribution. All of this is true.
That top performer trip is certainly solidifying relationships and delivering the message to those top people that they are appreciated. It's also very likely working hard to keep them on your team. The real question is whether these objectives meet the primary goals of your sales incentive program.
If you want to reward the top 5% or so with the vacation of a lifetime as a thank you for their contribution, then the luxury trip is a great idea. However, you should strive to encourage the maximum number of people on your sales team to push a little harder than last year, last quarter or even last week. You want to put every oar in the water, and you can be sure that the "top performer" format isn't doing anything close to that.
Think about it from the standpoint of that large center mix on your scale from low to high performers. As soon as you announce the criteria for next year's top performer trip, how many of your people have any real chance of winning? You already know the majority of who will make it (because they always do), so the only people truly motivated are at the fringes of the top 5% to 7% of your team. The rest know they have little or no chance, so they just go on with their routines - the program isn't designed for them.
What Is the Primary Purpose of Your Sales Incentives Program?
You know what that big trip isn't accomplishing. Now, it's time to identify what you wish it was doing - the primary purpose of sales incentives like these. You need to motivate your team members to perform to the best of their ability, and you want that ability to continue improving over time. You also want to impact your salespeople this way year-round, not just every quarter or once a year when you run a huge contest or promotion.
Who Are You Targeting With Your Sales Incentives Program?
Rewarding your top performers is smart business. They do a good job, and they do it consistently. It's important to recognize their efforts and show appreciation for their work. This helps with engagement and job satisfaction. But most of these people are already highly motivated. Your bonus and commission structures play a role, and their inherent nature and natural competitiveness do too. These successful salespeople probably aren't the employees you should be targeting with your sales incentives program.
Consider the 80/20 Rule, formally called the Pareto Principle. This refers to the idea that 20% of your team is responsible for 80% of sales and profits. Obviously, human behavior is never as exact as math would like it to be. But it's generally true that 15% to 20% of top performers contribute far more than the rest of the team combined. And if you look to the opposite end of the scale, about 25% of your team is consistently underperforming. It's doubtful that your efforts will change that number significantly. Research shows that not everyone is cut out to be a salesperson, and this may apply to as many as 55% of people working in sales.
Instead, it's the middle 60% of your team you should be concentrating on. Getting them to move the needle just a few points can pay HUGE dividends. This is the group that may be motivated to perform better and aim higher with the right incentives. Now, just what are those?
Creative and Effective Sales Incentives
Identifying the best incentives for your sales team takes time and effort. There's no universal incentive that will magically work for every team member. Workers from different generations prioritize incentives and awards differently, as do people with families versus those who are single. Review the following ideas,and analyze how attractive they may be to your group.
Consider your company's sales incentives budget along with the potential benefits/rewards scenario and the projected investment/return ratio. Once you've identified the incentives you believe might be the best fit, you may even want to put them to a vote or have your salespeople complete a survey to gather their input.
- Paid time off
- Preferred parking spot
- Pizza or sushi party
- Appreciation jar/employee's (limited) choice
- Wall of fame
- At-work massage or manicure
- Spa Day
- Round of golf
- Extreme adventure activity - hang gliding, scuba diving, heli-skiing, ATVing
- Sporting event tickets
- Concert tickets
- Weekend accommodations at a nearby hotel
- Travel vouchers
- Scratchers/lottery tickets
- Gift cards
- Awards Ceremony
- Company retreat
- A personal assistant for the day
- Popular tech gadgets - iPad, Kindle, electronic VA
- Standing desk
- Mini fridge
- Subscription box service
- Movie passes
- DVD/on-demand movie vouchers
- Fitness club membership
- Yoga classes
- Paid session with a personal trainer
- Maid service at home for a day/week
- Company apparel/swag bags
Professional development incentives
- Sought-after seminar tickets
- PD book allowance
- Paid session with a pro - investment counselor, public speaker, motivational pro, life coach
- Time off for charity work, such as helping Habitat for Humanity
- Donation to charity/nonprofit of choice
- Letting them organize the next team service project
Engaging More of Your Team Members by Rewarding Them Wisely
So, you understand the primary purpose of your sales incentives program. You realize who you need to target to reap the most rewards, and you have a good idea of how to identify the types of incentives that may work for your team. But how should you implement the program? Here are few suggestions.
Good - If the yearly trip is an institution at this point and there really isn't any way to eliminate it gracefully, alter it instead. Add a point program layer of 15% to 20% of the team who are just below making the trip, extending the motivational impact to your team. Now you've got motivation that mirrors the "shoot for the stars, and even if you miss, you'll get the moon!" philosophy. Nothing is more frustrating than coming close to the big trip and then getting nothing at all.
Better - Create appropriate brackets within your team. Put people who are in similar territories and making similar sales with comparable quotas in the same bracket, allowing them to compete with themselves and each other. Let's say you end up with four brackets that start with brand-new associates at the bottom and your well-established stars at the top, while the middle two brackets accommodate the rest. Now each group competes against peers, and within each group, there is a more realistic chance for a high number to compete and win. There are many ways to create winning categories in each bracket. For example, the top X% within each bracket may make the trip, and those who achieve two or three additional levels within the brackets earn awards of varying types.
Best - If the data is available, selling against the previous year during the same time period provides the broadest competitive impact. There are various ways to accommodate top performers who are already just about maxed out for various reasons. But the key is that no one can get in the way of an individual salesperson improving on numbers from the previous year. They know what they did, and they know what they need to do to grow. This is what puts every oar in the water! This format will result in a broad mix of earning abilities, so a points structure is the perfect solution to let each participant shoot for their own growth goal. The additional benefit is that focusing on rewarding growth funds itself!
There are many other formats that can accommodate unique business structures, available budget restrictions and other factors while still accomplishing the main goal of motivating the largest percentage of team members. But the main point is this - don't judge a sales incentives program by the people inside enjoying the party. You have to judge it by the people outside who didn't get in and the impact on their desire to perform at the highest level for the organization.
Is your program leaving too many people out in the cold? How are you going to get more of your team in the game? That's where we shine! We can help you offer recognition and appreciation to your top performers, identify sales incentives that provide true motivation to that middle group of salespeople - the ones who are likely to be most responsive - and design an incentive program that is best suited to your business requirements, desires and limitations.