6 steps for a successful business incentive program
Enticing your existing customers to spend more is the most profitable opportunity available to you for generating enhanced sales growth over the next 12 months.
Business incentive programs provide a way for suppliers to fight for the mindshare of channel partners, e.g. distributors, retailers and franchisees.
So, with a carefully designed and well-run incentive program, you can ignite a sales incentive, motivate marketing staff, and encourage discretionary spend towards your products.
The six essential elements for a successful incentive program are:
A good target includes three components; last year’s sales, business as usual growth and your desired growth. Targets should match reward values, offer a number of levels, be time-based and be documented and transparent. By sticking to the targets and by avoiding moving the goal posts, the incentive program has a higher chance of succeeding.
2. Aspirational reward
Your reward (travel or merchandise) needs to be carefully considered to maximise motivation. The reward could be a money can’t buy experience like driving a Ferrari along the Italian Amalfi coastline. When planning your reward, it’s important to remember, the more memorable the experience the greater the word of mouth will be, meaning it is also more likely to succeed the following year.
Keeping your channel partners motivated throughout the incentive buying period involves a number of steps. It’s vital to keep your clients up-to-date from start to finish on how they’re performing in relation to their target, during the buying period, as well as after it’s finished.
It is important to have a remedial plan of action should additional support be required. A detailed process should include, launch kit, sales team training (see next point), data uploads, email campaigns, mid-program teasers, event execution, reward fulfilment.
Some of the best-practice programs have over 300 tasks to ensure success. A well-constructed incentive program can be very profitable especially in the second, third, fourth and fifth year when you are achieving growth on growth.
You must train your staff effectively throughout the channel sales process, so they can educate your customers to successfully sell the program. You also need to train your sales team on the incentive program. This training includes detailing:
- What is a business incentive program?
- The aspirational reward
- How to help the client achieve their target
- What tools the sales team will be provided and how to use them
- Scenario discussions – what can be done to change the outcome or how to get a client to the target
- The benefits to the business
If you thoroughly train your staff on the incentive program, this will result in your channel clients being more confident, which will then see an increase in sales and profit.
Communication is also important on many levels. An up-to-date website with targets and progress to date is essential. The website must detail the aspirational reward in great detail – a video is a great addition. It is vital to have the communication open between your sales team and customers, it’s also important to keep it honest if they are off target they need to know as soon as possible.
Frequent communication focused around the program, changes the channel sales conversation away from price to how much do I have to buy. When it comes to emails, consider the timing and the type of messages, you should be reinforcing good practice, the aspirational reward and the progress of the targets. As it gets closer to the program’s end date, it is important to increase the frequency of communication.
Also, make sure the communication is aimed towards the right executives, either the person who is receiving the reward or the person who can influence the end result. This may mean that one business might receive multiple emails.
Many customers need constant support and the best support you can offer is a commitment of your time and energy to ensure they are receiving everything they need to be successful. Your customers like to know they can rely on you, so make sure you offer your support from the very first interaction. A well-run incentive program will open up the communication between your customers and their sales representatives – the discussions now focus on how to make them more successful.
The recipe for a successful incentive program includes the following: establishing financial objectives, presentation of goals and expectations, measuring performance, and rewarding effort. Growth programs are measurable, meaning you only pay for the incentive when you see great results – your customers simply need to achieve to receive. The exciting thing about our growth programs is that they are self-funded, meaning the program funding does not impact your marketing budget.
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