Sales Information |
Incentive Dilemma:
Manufacturers and distributors are rolling out more sales incentive programs for their channel partners than ever before. Some of these programs are not as successful as they could be, however, because they fail to appreciate fully what motivates salespeople and drives them to overachieve. Read on to learn six key concepts that can make your incentive programs more effective. The dangling of the proverbial carrot is an ancient art that is commonly understood to be at the heart of human behavior, psychology, motivation, and, in particular, business. Manufacturers and distributors commonly use this technique with their channel partners in an effort to add unique motivational value to move specific products or services. The reason this technique has stood the test of time is because, for the most part, it works! At times, however, elements of the technique are executed improperly. Sales incentive programs under perform or fail as a result. The monetary values of incentives are often not the critical factor in motivating sales people to succeed. Take my own example. I was fortunate to work in an industry that provided an unending supply of incentives and awards for overachievement. I knew that, if I won every trip, every TV, every incentive offered, the money would come with it! For me, the money and the goodies were not my primary motivation. My philosophy was simple; "If you win all the incentives there are to win, you couldn't help but be at or near the top every time." Corporations use incentive programs to drive behavior and I agreed to play the game and conform to their wishes; what gets rewarded, gets done. The problem, from the vendors' point of view, is that not all salespeople are motivated the same way. Consequently, not all incentive programs work. Why is that? From my experience, I'll make the following observations: 1) The 80-20 Rule: Twenty percent of the salespeople make eighty percent of the sales and profits. Too often, sales incentives - perhaps in an effort to be fair - are geared to the entire sales force or VAR channel. The risk in a program like this is that the glove that fits everyone, in the end, fits no one. Enlightened marketing strategists know that the top twenty percent are already motivated. Simply put, a strategy that's geared to light a fire under the next twenty percent - the next logical group - doubles the business in a more cost efficient manner. 2) The KISS Theory: Salespeople by nature are like electricity. They naturally take the path of least resistance. That's not to say they are lazy or untoward. In fact, it's just the opposite. Good salespeople look to simplicity to make things happen. Often, incentive programs fail miserably because of innate complexities either in their recording and reporting systems or in how rewards are won. If you put the salesperson in a position where they are forced to assess "To get this, I first have to sell this, plus these and not these and they must include these," you are creating a recipe for confusion, sales frustration and failure. In the end, the incentive program becomes a disincentive! The remedy? Manufacturers must keep the program sweet and simple and attainable. There can be no ambiguity. Anything less will result in a lack of interest, as well as a waste of time and money that can sometimes spill over into other departments whose task it is to administer and account. 3) Education: Edison may have invented the light bulb, but it never went anywhere until a salesman understood its benefits and made the first sale? and probably sold a lamp to go with it! Incentive programs don't just sell themselves. Too often, expensive motivational programs are overlooked in the field because reps either don't understand their value and/or are unsure how to sell them. Many times, good programs are written off as having missed the target, when in reality, they just weren't rolled out and managed properly. 4) Competition: Everyone's heard the expression, "Timing is Everything!" This is particularly important sage advice for the successful incentive program planner. Marketing execs can't know when every competitive incentive program will rear its aggressive head, but they can take strides to ensure their program is given first look. Any successful salesperson will tell you, "Most sales are made as a result of due diligence on the front end." Simply put, the better the preparation, the more likely the sale. The same can be said for incentive initiatives. Real incentive programs, like new movie releases, are something to be anticipated. The right amount of promotion ensures greater acceptance and interest that often usurps focus on competing programs. 5) Reward: Any reward-value can become an unmotivated anticlimactic activity if the time span between winning and getting, is too long. Successful incentive programs reward immediately! As a rule, the faster the reward is delivered, the greater the enthusiasm for the program. Although on some levels, salespeople are a complex breed, when it comes to incentives, they are - for the most part - quite predictable. Their nature is to react to excitement or challenge faster then most, and then move on. One way to maximize their natural bent and ensure greater program success is simply to cater to their natural motivators. "Get them their stuff QUICKLY!" 6) Recognition: At the risk of making salespeople appear shallow or monolithic (they are not), recognition amongst their peers is still the quintessential motivator, whether there's an incentive program or not. The rule again, is, there is no such thing as TOO much recognition! Salespeople by nature gravitate to the limelight much like other performers, and so there should be no shortage of achievement and overachievement recognitions that find their way - in a timely manner - to the public's eye. Psychological studies have shown that the pursuit of recognition, in and of itself, can make the difference in targeting that critical second twenty percent on the sales achievement ladder. Experts agree that successful sales teams find motivation in their own champions. Beatifying the sales leaders instills excitement and a definable hierarchy that beckons all players to become a part. Another fact that is frequently overlooked is that recognition, whether part of an incentive or not, is the least expensive means of motivation. In many cases, it's free! Often, shaking the hand of the president in front of the company is all it takes to galvanize the need to overachieve. The Bottom Line: Manufacturers and Distributors must take greater care when designing motivational incentive programs. Take a page out of the "Sales 101" book that says, "Find out what they want, then, give it to them!" But make sure to keep it simple, keep it clear, promote it properly, reward immediately, don't try to target everybody, and, recognize, recognize? RECOGNIZE! About The Author Paul Shearstone aka The 'Pragmatic Persuasionist' is one of North America's foremost experts on Sales and Persuasion. An International Keynote Speaker, Author, Writer, Motivation, Corporate Ethics, / Time & Stress Management Specialist, Paul enlightens and challenges audiences as he informs, motivates and entertains. To comment on this article or to book the Pragmatic Persuasionist for your next successful event we invite to contact Paul Shearstone directly @ 416-728-5556 or 1-866-855-4590 www.success150.com; paul@success150.com
MORE RESOURCES: Unable to open RSS Feed $XMLfilename with error HTTP ERROR: 404, exiting |
RELATED ARTICLES
At-ti-tude, n At-ti-tude, n.One of Webster's dictionaries describes the word attitude as:a mental position; the feeling one has for oneself. Take the Contract with You I learned something very interesting this week. Thankfully, what I learned was really at no one's expense. Sex Sells! An attractive woman has a decided advantage as sales representative over her male counterpart. This "selling edge" is primarily due to the existence of the "glass ceiling" found in most business organizations today. Persuading Learners to Buy: 7 Groups There are seven major reasons why adults continue their pursuit to learn. Each of the reasons play into the way you want to present your sales information. Smooth Sailing (Selling) In The Second Half of The Year You can make a difference in the second half! You can't do it by doing the same things the same way.You can make a difference in the second half every year! You can do it by thinking differently and being different. Referrals: Getting Good Business By Doing Good Business Whether you're a conventional sales person, a professional - such as a dentist or lawyer or doctor - or a business owner, you've got to have clients to stay in business. There are several ways to do this: either continue to find new customers, keep all of the customers you've ever had, get old clients to return, or get customers to send in referrals. The Top 10 Myths About the Sales Profession Myth 1: Sales People are all Shady!In the Broadway play "Death of a Salesman" Willy Loman was a down and out emotionally spent Salesman trying to understand his life after 34 years of traveling up and down the roads selling his products. The negative stereotype of a Salesman is rooted deep into the subconscious of society. Just Ask! Instilling urgency in a prospective customer can make the difference between achieving a sale and losing it altogether. If your prospects cannot vividly see personal benefits from taking action, there will never be the sense of urgency needed to follow your suggestions. 101 Ways to Improve Your Direct Mail Response 1. Mail to your customers more often. The Secrets Behind Hypnotic Selling Hypnosis has been a taboo word for far too long. And many people see it in a mystical light. Packaging Maketh the Person The multi million pound cosmetics industry is acutely awareof the value of packaging. You'll know this if you've everbought anything from those glamorous ladies whose countersare always just inside the front door of Department stores. Creating More Effective Proposals The need for good proposals - the business kind, not the marriage kind - struck me again a couple of days ago, when I received a poor proposal. I had talked on the phone with a sales rep, and then she followed up with a proposal. Leads, Prospects, and the Huge Gap Between The leads marketing delivers to the sales team never seem good enough. Either the leads are "bad" and are wastes of a salesperson's time, or there are just not enough "good" ones. Youve Got a Great Business, but Nobody Cares! I would like to share a disturbing little secret with you. Almost 70% of the people you do face-to-face business, with will never speak to you again!It's not that they didn't like you or get value from your services, but they just don't care. Talking To A Prospect As If To A Friend While working with a new coaching client, I asked to hear her sound bite. Everyone needs a good sound bite. Unique Selling Propositions If you have competitors, then you should have at least one Unique Selling Proposition (USP). The more REAL ones you have, the better - for your Branding, your business recognition, and your sales!We all have competitors, and the more you have, the more important it is that you have a Unique Selling Proposition (at least one). Value Based Pricing, Not Price Cutting Special Requirements for Reprint: we ask only that you include Paul's name and resource box, and keep all hyperlinks as live links.Complete Article with Resource Box at end:Value Based Pricing, Not Price CuttingThe oldest tactic in the world to get a sale moving is to cut the price. 12 Handy Tips for Generating Leads through Cold-Calling Cold calling can be a great way to generate quality leads. You get to speak to the gatekeepers and stakeholders, and you get a great insight into their requirements and influences. Mindset Over Materials: The Secret Weapon of Sustainable Sales Success Long-term sales success has less to do with skills or knowledgethan you might think. Nor are stunning brochures or excellentproducts guaranteed to make one iota of impact over time. Are You a Cultivator or a Harvester? As a result of providing marketing consulting, training and coaching to a variety of individuals and industries over the years, I have come to recognize that people generally approach the business building process in one of two ways. Everyone tends to be what I identify as either Cultivators or Harvesters. |
home | site map | contact us |