One of the most effective ways to increase sales performance and boost a business’s continued development is to appeal to basic human psychology and behavior by offering salespeople an extra motivation. When utilized correctly, a good sales incentive program can prove a windfall to businesses trying to move products or services quickly to as many people as possible.
The important thing to remember is that not all salespeople are motivated in the same way. In fact, often it is not the monetary value of an incentive that drives salespeople to participate in incentive programs so much as personal factors such as professional esteem.
This is why it pays for businesses to keep the following in mind when crafting an incentive program:
Simpler is Better
The quickest way to ruin the effectiveness of an incentive program is to make it too complicated and difficult to bother with. The easier your incentive program is to figure out and follow, the more likely your salespeople are to use it.
For businesses, this means that the prerequisites for acquiring incentives need to be simple and easily understood. It doesn’t take much confusion to make a program no longer worth it to those who are supposed to be interested in it. If gaining an incentive means jumping through a dozen hoops, nobody will bother. You’ll only be wasting time and resources.
Not All Salespeople Are Equal in Value
The “80-20 rule,” that holds that in most businesses, 20 percent of individuals will account for 80 percent of the profits, applies equally to salespeople. That is to say, the top fifth or so of your team is likely bringing in the most revenue, with each section below them contributing less and less overall.
When it comes time to motivate, then, businesses need to make sure that they are aiming their motivation at the right segment. Your top performers are already top performers without added incentive, so there’s little need to sweeten the deal. Targeting everybody, however, is also inefficient. The best course of action is to find the second to the top segment and aim your motivation at them to bring them up to where your top performers already are.
Timing is Everything
Another quick way that an incentive program can lose the interest of those whose interest it is trying to grab is to include too much of a delay between somebody winning an award and actually receiving it. This goes back to making things too complex. If you have to keep track of the incentives you’ve won over a longer length of time, you’re going to lose interest. The most effective incentives are allocated immediately, or as close as possible to immediately.
For businesses, this means that whatever rewards are offered in an incentive program need to be either timeless or topical as well as on hand. Money has no expiration date, and things like tickets to an upcoming event will also work – if the event is coming up soon. Don’t offer your people rewards that won’t be redeemable for weeks or months after they’re won or you’ll severely dampen the potential for excitement.
Recognition and Appreciation Are Key
While different things to different degrees motivate different people, one common factor among most professionals is an appreciation for being appreciated. Make sure your incentive program targets winners openly where their peers can know about it. We all like to look good at our jobs and around our colleagues, so sometimes even a free prize like recognition can be more useful to a tangible prize awarded out where nobody can see.