Getting the most from your sales team is key to achieving revenue growth. As a manager, keeping your sales team motivated can be challenging. Your sales team needs to convince more people than ever to adopt a product, your product may be complex and there's increasing market competition and longer sales cycles. This is where sales incentives can provide the motivation they need to go that extra mile.
Here at Ovation Incentives, we've helped some of the world's leading companies with channel and sales incentives. These include Honda, Sky, iPrism and many more.
In this article, our experts will outline what exactly are sales incentives, why they are important and some useful examples of the best sales incentives around.
What are Sales Incentives?
A sales incentive is a reward given to salespeople for selling a particular amount of a product or service in a given period. They are usually given for meeting or exceeding their sales target. They can either be financial or non-financial rewards based on the preferences and interests of the salespeople and the company budget.
Why Sales Incentives Are Important
A highly motivated and skilled sales team is something every company sales desires. When your sales team is performing well, it gives your business a real chance of thriving. A well-run sales incentives scheme is the answer here. Incentives are a great way to show your employees you value their efforts whilst boosting growth for the entire company.
But, do sales incentives work? Do they provide enough ROI to be worth an organisation's time, effort, and resources? Well, if done right, they can yield some amazing results. One study found that changes in compensation (e.g. incentive programmes) can be hugely beneficial and "have been found to have a 50% higher impact on sales than changes in advertising investments." - McKinsey & Company
Here are 6 reasons why sales incentives are important:
Incentives Provide Motivation
For your sales team to perform, they need to be motivated. Sales incentives may just be the kick-start your team needs to exceed expectations, boost employee engagement and financial growth as a result. Sales incentives are a proven method to boost performance as they show your appreciation for your team and encourage positive behaviours. A study by the Incentive Research Foundation has found that quality incentive programs can increase performance by as much as 44%.
Incentives Foster Loyalty
When your employees feel valued and appreciated they are more likely to show loyalty to your company. Providing them with the right incentives as they meet or exceed sales targets shows you value their efforts and promotes loyalty within the company whilst creating a positive environment. This loyalty is also beneficial to your customers who will enjoy a better customer experience and relationships with your sales reps.
Incentives Attract the Best Sales Talent
One of the most common reasons for employees moving on is that they feel unappreciated and undervalued. Having an excellent sales incentive strategy can help reduce employee turnover. It's an effective way to consistently show your staff that you value and appreciate their efforts that help boost company growth.
Incentives Drive Competition
A common trait amongst many salespeople is a competitive spirit. This drives them to be better and get the bragging rights over their colleagues. With incentives, your sales reps will have something tangible to compete for. This helps foster healthy competition and promotes the behaviours you want to see from them; hard work, productivity and determination.
Incentives Prompt Collaboration
As well as healthy competition, sales incentives can also encourage collaboration. To promote the importance of teamwork you can set a team goal with a larger than usual incentive for everyone in that team for achieving that goal. This encourages everyone to work together collaboratively to reach a common objective. Something that is commonly desired across many organisations and can help your company achieve its goals.
Incentives Drive Sales
Setting realistic goals and targets for your sales team should be a must. Adding an incentive for your sales reps can help make these achievable. Over time as sales build, you can increase your targets and the subsequent rewards they will receive to help your team focus on their purpose and objectives. Incentives are a great way to help build your sales over time and help your team and the company achieve its goals.
Effective Sales Incentives
Here are 8 sales incentives examples that can help boost company growth. Our suggestions may not be suitable in all sales environments. Consider specific incentivisation techniques such as a SPIF (sales performance incentive fund) based on your team and their needs.
Flexible Working and Paid Time Off
One of the most motivating incentives you can offer is to reward a sales rep with additional paid leave, or some flexible working hours. If your employee is consistently landing great deals then give them the break they deserve. They'll come back refreshed and motivated to perform at a high level again. Alternatively, allow them the freedom to choose their schedule. This will show you trust them to perform. Should their performance decline, you should reintroduce the standard working hours. This incentive is a privilege that must be earned.
Cash is the most common incentive for sales teams. Cash rewards can work great over the short term but may not always be the best motivator. Combining them with non-monetary rewards can increase their effectiveness as often some kind words can go a long way into showing you value your team.
Another popular sales incentive is a gift card or voucher. Unlike cash rewards which are often spent on daily essentials, gift cards can feel more rewarding when they're tailored to the recipient. Find out what your sales rep wants or where they would like to shop, or better yet offer them the choice with a digital reward code.
Gym Membership or Yoga Classes
Wellness related incentives such as gym memberships are growing in popularity. Many people find gym memberships can be expensive and therefore don't always continue with it. Providing a membership to a great gym might just be what your staff are looking for. Others might prefer yoga, pilates or dance classes. These incentives help your sales team improve their physical and mental wellbeing of your employees and improve their productivity and focus.
Spa treatments are another wellness incentive that can make your sales reps come back feeling relaxed, refreshed and pampered. These can act as a great motivator in some sales environments and demonstrate you care about the wellbeing of your staff.
If you're looking for something more memorable, then travel, leisure or experience vouchers could be perfect. It's important to let your salespeople choose their reward here to make sure it's an experience they'll treasure. This can be anything from a ride in a hot-air balloon, a track day or a weekend away for two. The goal here is to create memories your sales rep will never forget.
Creating the feel-good factor doesn't always mean rewarding your employees. Research shows 71% of employees would like to see their employers making valuable and worthy charitable donations. For example, you could donate a portion of revenue from a sales campaign to an agreed charity. People will often work harder if they feel there's some good they can do for others.
Professional Development Opportunities
Professional development opportunities are an effective SPIF that encourage your team to grow, learn and progress. These effectively show that you're committed to their success which will also benefit you in the future. These can include:
- Attending learning seminars
- Engaging in an online training program
- Taking part in in-house training schemes
The sales incentives you choose should depend on your goals, team and budget. Discuss ideas with your salespeople and find out what motivates them over the short and long term. Our experts find that giving them the choice of rewards can help keep things fresh and interesting. Getting the balance right can be tricky, but when you do, your sales team will be motivated, focused and ready to pull out all the stops for you. They'll not only help you meet the company sales targets but can help you retain your top talent and foster loyalty to your company.
To find out how we can help you with your sales incentives, book a demo or contact us today.