As a sales manager, one is always looking for effective ways to motivate their teams for better performances, which usually rounds up to using commission sales as a motivator. Regardless of the fact that many people look for incentives other than monetary compensations to encourage them to excel at their jobs; there are still a majority of them looking for financial rewards to get them going – which makes commissions a powerful motivator for most.
If you’re thinking there’s just one way to use commissions as an incentive, think again! Or rather go through these tried and tested ways of using commission sales to motivate your teams:
Ever Heard of Pace-Setting Bonuses?
Instead of announcing a yearend bonus, break it down into quarterly bonuses. Research shows that laggards are more motivated to perform better with multiple bonuses during the year than by a substantial amount at the end. It keeps them on their toes the whole year round in hopes of making more money every three months. The same study also pointed out, that these pace-setting bonuses bring about a 10% increase in their overall performance as compared to that in case of a single bonus.
Try No Ceiling Commissions
A study showed that companies that capped their commission plans after they reached a certain limit faced a 9% decrease in their revenues. The game is simple, you don’t just need to motivate the average performers; you need to make sure there are adequate measures in place to keep the high performers motivated too. If your sales stars know that they will be sufficiently rewarded for their efforts, they wouldn’t back down from going the extra mile.
The Overachievers Need Special Recognition!
Over achievement commissions are higher rates of commissions for those in your team who complete their quotas and surpass them regularly. Here’s how it works: let’s assume your sales representative earns a cent for every dollar of revenue they earn up to their pre-defined quota. Once they reach their quota, every dollar they earn above that would entitle them to two cents instead of one. This is a great way to encourage your team to meet and excel their targets.
Pair the Commissions with Prizes
We’re all aware of the fact that not everyone is motivated by monetary benefits. People look for more than just that: quality time with family, a vacation, that latest model of a Movado wristwatch! It could be anything. You as the sales manager do not want to reach a point where there’s nothing you can motivate your team with. Announce prizes for top performers in addition to their commissions. A short vacation for two; dinner vouchers to a fancy restaurant, a cell phone, or anything that may make your team look forward to the ‘prize’.
It isn’t necessary to stick to a single commission sales plan to motivate your teams; you can have multiple structures based on the types of products and markets you’re dealing with. Automating your commissions and their working may be the only thing stopping you from developing an effective and efficient commission sales plan – take a look at the CallidusCloud Commissions and find out for yourself!