If your company deals in sales, then you know that your salespeople are your most important team. Yet, sales positions are competitive, and to maintain your best people, there are a few things you can do.
Here is more about the importance of sales incentive programs and why they work.
Sales Incentive Programs Motivate Employees
According to Very Well Mind, there is psychology behind motivation:
Different types of motivation are frequently described as being either extrinsic or intrinsic. Extrinsic motivations are those that arise from outside of the individual and often involve rewards such as trophies, money, social recognition, or praise. Intrinsic motivations are those that arise from within the individual, such as doing a complicated crossword puzzle purely for the personal gratification of solving a problem.
In sales, both extrinsic and intrinsic motivations are prevalent. The salesperson solves a problem and gets rewarded.
Incentive Programs Create Loyalty
Employees who feel appreciated are typically more loyal. Everyone loves appreciation. While a fat commission check may encourage more work, it doesn't address how the company feels about all of the hard work.
The right kind of incentive program not only creates a sense of loyalty, but it also helps with retention.
Look at it this way: Would you rather work for a place that pays you a commission for your hard work, or for a company that gives you incentives on top of your commission?
Rewards Programs Promote Healthy Competition and Teamwork
Healthy competition helps stress more productive work from your employees. An article in Entrepreneur states it best:
Nothing will demotivate your best employees more than feeling that you don’t appreciate excellence. If you reward all your employees in the same manner, why should people work hard to differentiate themselves? Rewarding people equally, regardless of performance, will eventually create an environment of mediocracy.
With incentive programs, employees have something to compete for. Not only does this foster harder work, but it often creates better teamwork. Even peer pressure is healthy in this case, because it often allows under performers to excel when they don't want to let the team down. Or, it encourages them to excel if they are striving for one of the incentives implemented for those at the top.
A Hiring Edge
The best in sales often have their choice in companies. When that is the case, a prospective employee is going to look at the usual advantages like compensation, work hours, commute, and benefits. Yet, if a company also offers excellent incentive programs, it is an attractive offer. Offering the best sales incentives means getting the best employee pool to choose from.
To have the best sales team, you must offer them the incentives that are enticing. Why choose a company that only pays a commission when another company offers commission plus sales incentives?
On top of that, these incentives provide goals for sales reps who might otherwise become bored with their company's commission-only plan. This brings us to another advantage: goals.
Goals Create Interest
A good salesperson is someone who has that knack at finding a solution for their customers. Having goals, like a reward for the most sales or having the highest ratio, creates a sense of interest and competition. And healthy competition is paramount in a workforce that is invested in your company.
An employee who is there just to collect a paycheck is going to do the least needed in order to earn a living. Those who are the best are always looking for the best plans for their career. Having goals sets up that employee for a way to exceed expectations.
A Program for Every Employee
For an effective incentive program, it must include all employees. Sure, the top employee in your company may get all of the benefits, but where does that leave everyone else? If only one employee always "wins" everything, how does that inspire the others? In some cases, a person will think that they cannot compete, so why bother? Why go above and beyond if the same person wins all the time?
Your lowest performers are not going to be inspired by something they feel they cannot win. So, if you are only rewarding the top percentage of your sales force, you are missing out what the others can achieve.
Instead, choosing a program that includes everyone solidifies that everyone is equally important. And it showcases that everyone has the ability to be a winner.
For example, if you have 40 members on your team and there are 10 who perform the best, that leaves 30 sales reps. Now, if 10 of them are at near the bottom, that leaves 20 in the middle. Those reps in the middle can easily provide your company with expanded sales if they have the right incentive that inspires them to work harder. This means more profit, happier employees, and more motivated sales reps. Even those with the lowest sales numbers can easily raise their sales when inspired. And for some, commission alone is not going to do that.
Rewards Trigger Response
Look at the success of loyalty reward programs for consumers. People eagerly sign up for these rewards, knowing their loyalty gains them something. This is no different from your sales force. Knowing they have a reward for their work lights up areas of the brain just like it does in a consumer who gained enough points for a gift card or money off a purchase. In fact, processing in the brain's “reward system” drives our motivated behavior.
Do you have the right kind of sales incentive program? We can help you offer recognition and appreciation to your top performers, identify sales incentives that motivate that middle group of salespeople — the ones who are likely to be most responsive — and design an incentive program customized to your business need, desires, and limitations.