Examples of effective Programs
- Points-based incentive programs are a type of program where participants collect and redeem points for rewards. Depending on the program type and the organizational objectives, points can be awarded on a number of criteria including positive employee behavior, the demonstration of organizational values, repeat customer purchases, the sale of new products, increased overall sales, or even the use of proper safety precautions. In addition to point awarding, the levels at which points can be redeemed can be customized by the organization and set at virtually any level. Points programs are a way for organizations to motivate behavior over time while improving the organizations’ overall performance.
Employee incentive programs are programs used to increase overall employee performance. Employee programs are often used to reduce turnover, boost morale and loyalty, improve employee wellness, increase retention, and drive daily employee performance.
Consumer incentive programs are programs targeting the customers and consumers of an organization. In a recent study conducted by Bain & Company’s research, researchers found that a simple 5% increase in a company’s customer retention rates will increase the average lifetime profits per customer. Consumer programs are becoming more widely used as more companies realize that existing customers cost less to reach, cost less to sell, are less vulnerable to attacks from the competition, and buy more over the long term.
Dealer incentive programs are used to improve performance for dealer and channel re-sellers using sales incentive programs. It can motivate the staff which in turn only helps business. These programs help companies capture market share, launch new products, reduce cost of sales, increase product adoption, and ultimately drive sales. It helps develop long term relationships with Sales partners.
A channel loyalty program can help :
- Increase the brand awareness in the market
- Provide momentum to new launches
- Build long term market share
- Build and enhance long term ties with channel partners
One of the top manufacturers of premium-quality windows wanted its sellers to increase their sales. BI WORLDWIDE established a nationwide 90-day GoalQuest® program where each rep aimed at one of three sales goals. The higher the chosen goal, the greater the reward. Reps would only earn awards, if their chosen goals were achieved. This resulted in an increase of 53.6% over the baseline, and $9,772,073 in incremental revenue. The ROI of the program was 24:1.
Sales Incentive Programs
These programs are primarily used to drive sales, reduce sales costs, increase profitability, develop new territory, and enhance margins. Sales incentive programs have the most direct relationship to outcomes. A sales incentive plan (SIP) is a business tool used to motivate and compensate a sales professional (or sales agent) to meet goals or metrics over a specific period of time, usually broken into a plan for a fiscal quarter or fiscal year.
A SIP is very similar to a commission plan; however, a SIP can incorporate sales metrics other than goods sold (or value of goods sold), which is traditionally how a commission plan is derived. Sales metrics used in a SIP are typically in the form of sales quotas (sometimes referred to as point of sale or POS shipments), new business opportunities and/or management by objectives (MBO's) independent action of the sales professional and is usually used in conjunction with a base salary.