Most of my sales career I was the bootstrapped underdog. When it came to recruiting, and employee retention, I was competing against other tech companies with much deeper pockets.
Finding and developing sales talent in those circumstances can be challenging, but that’s a topic for another day. What about when you have jumped over those hurdles and now have a rockstar team you need to incentivize?
As the accidental sales leader, it took me a couple of years to even realize that I needed sales incentives. I thought that a team of adults would feel infantilized by silly contests and perks, and that the intrinsic reward of a job well done was all that was needed. That was a naive belief.
Ridiculous, really. Incentives are an important part of any high-performance sales culture. They are fun, they reward the outcomes you are striving for, they foster competition and they provide much needed short and long-term motivation. They are tangible rewards for sustained effort and skill in a profession that requires grit and fortitude. Sales incentives help you meet your goals and keep everyone focused.
Sales teams, particularly ones at funded start ups, are notorious for mega-incentives like ski trips, president’s club retreats at upscale resorts and large cash bonuses. Often, it’s not any single incentive that is outlandish, it’s the sum total of all of them combined.
It’s enough to make a bootstrapped entrepreneur’s heart race.
Don’t let urban myth stories about lavish sales incentives scare you. Budgets almost always necessitated that my sales incentives were low cost. But, that was OK. In my experience a passionate sales team isn’t clamoring for the next quick buck or contest win. Sure, those things are awesome, but that isn’t why they show up everyday. Doing fulfilling work for a company and product they believe in is what drives them. For this type of team, incentives are rewarding and they are important, but they’re the icing, not the cake.
Your particular sales incentive plan is going to be specific to your size organization and your budgets. To give some context, I’ve designed some sales incentive plans with some pretty significant budgets for clients, but at my bootstrapped company I can’t recall ever spending more than $15,000 total annually for sales incentives (including cash, bonuses and prizes), and usually it was far less than that—like, way less than that. Your lean budget may be much higher or much lower than that. What I think is important is being rational without being miserly, within whatever budget you have.
Here are a few of my favorite options for budget-friendly sales incentives.
Highly personalized sales incentives.
One year, I made it my mission that every incentive would be personal to the individual receiving it. That meant that when a certain target was hit, or quick contest was won, someone got a gift card to their favorite restaurant, someone else got a one-month membership at their favorite yoga studio, someone else got a case of their favorite wine, etc. The personal attention to their likes and dislikes was appreciated, and each incentive was something useful and relevant to the individuals on the team. It’s not about the dollar amount of the reward, it’s about the thought you put in to it. If you are really strapped for cash, take this same approach on an even smaller scale—get a bottle of wine instead of a case. Get someone a car wash, or a tank of gas even. Don’t let the concern over money get in the way, just do as much as you can.
Weekly, monthly, quarterly, annually. Cash is fun. Everyone, no matter how much their total compensation is, loves a little extra cash in their pocket. Give out a $50 bill on a Friday afternoon for most qualified opportunities created that week. Give out $200 at the end of the month to the rep who closed the most deals. Keep cash on hand, it doesn’t have to be much, for small weekly, monthly, and quarterly contests. And design your sales comp to give top performers a bonus at the end of the year—the amount is less important that the recognition. I typically designed it so there was a bonus for most contract value closed, and something smaller for the highest single contract value, and other significant achievements.
I know this sounds like a big ticket item, but it doesn’t have to be. I typically gave some financial bonuses for top performers at the close of a year, but whenever I could I also gave a trip to the rep who brought in the highest overall contract value. If you plan well for it, and even save for it over the course of the year, you can afford it. It doesn’t have to be an over-the-top trip—a weekend away will do. Rather than going for the glamour destination like Vail, pick a slightly less popular destination that gives you more bang for the buck, and look for value-driven lodging and transportation options.
Your time and attention.
I predict I may get some eye rolls on this one. But connecting with your team and showing them your appreciation is so important. Your time and attention conveys your care for them. Host a dinner at your home and cook for your team when they hit a big milestone. Take everyone to a local sporting event (minor league baseball is a good budget-friendly option). Take everyone out for a round of beers, or a lunch, and give a special toast to the rep who had the big contract close that week.
So, make incentives thoughtful. It’s not about how much you spend it is about the usefulness of the incentive. And don’t short change this. Everything starts with a sale, and the sales team needs rewards for their hard work. Squeeze budget from every nook and cranny to come up with motivating, useful incentives. But just don’t break the bank.