Sales Rewards

Reward programs are among the few business strategies where the cost can be based upon performance and paid out after the results or goals are achieved. Many companies mistakenly view rewards as an expense instead of an investment. The risk in providing sales rewards is often that the reward is strictly based upon achieving an objective that was above what was initially required. Putting in simple words, if the sales individual doesn’t achieve the objective, there is little or nothing to pay out.

Rewards definition: (From Encarta Dictionary)

1. thing given in return – something desirable given in return for what somebody has done

2. benefit received – a benefit obtained as result of an action taken or job done

3. something reinforcing desired behavior – PSYCHOLOGY something positive that follows a desired response and act to encourage desired behavior

Throughout my career in sales, sales reward programs were an influential strategy that the companies I worked for and my own company used consistently to drive more sales. They are what kept me encouraged going out as a young new sales member. Rewards kept sales interesting and competitive. The effects were many: increased sales, commitment to learn a new sales process, increased knowledge of a product, bragging rights, and of course the reward. As an owner, it is what kept my sales staff motivated to go out and sell more. It created a behavior that was rewarded.  Sales spiffs and sales contest are an important tool to use to drive more sales. Too many companies miss this opportunity because they view this as an expense instead of an investment.

  • Sales Spiff (quick hit programs to focus the sales force on a specific product or service. It also offers additional rewards for sales during slow time periods or slow moving products)
  • Sales Contest (usually a longer time frame, again offering rewards to those achieving specific goals in selling a product or service)

Sales rewards help provide needed incentives to drive more sales in many areas. The benefits included:

  • Creating interest in a particular product allows the sales individual to become an expert because of their knowledge how to sell it.
  • Increasing sales during a traditionally slow time period.
  • Reducing inventory in slow moving products.
  • Moving high margin items into the sales representative’s everyday selling product category.
  • Creating competition among sales individuals, teams and branches. This leads to an overall achievement in knowledge of the product and how to sell it to the customer.
  • Excitement. Keeping the sales environment exciting and changing is another important function of rewards.

If your sales are lagging or if your sales department’s excitement is low, then I would encourage you to invest in sales rewards (spiffs and contests). Today’s progressive sales organization uses sales rewards on a regular basis to fire up their sales team or individual. If you need ideas or want me to help you structure this important psychology boost that leads to more sales, I would be happy to help.