By: Michael Torcasso
Most of us would agree that sales incentive programs are enormously valuable tools available to sales and marketing executives to help them increase their company’s sales and brand loyalty. Similar to other forms of retail advertising, sales incentives are designed to create a demand and stimulate an action to buy.
If executed properly, a sales incentive program can be a substantial competitive advantage for your company. So much so, that in some European countries incentive programs are considered an unfair competitive practice and in a few countries they are actually illegal.
The fundamental problem with so many incentive programs today is that they are structurally and strategically much the same as they were 30-years ago – before the Internet began to change everything. Online redemption for claims processing is no longer a novel feature: it is the price of entry to a smoothly executed and effective program.
So let’s look at the difference between the “everyone-is-doing-it-so-we-have-to-too” incentive programs and the ones that are a secret weapon and a competitive advantage for their companies?
3 Key Components to turn your Incentive Programs into a Competitive Advantage:
Be Strategic: Customize your programs and get intentional about every dollar in your marketing spend to get your greatest ROI.
Ask yourself: when you run a spiff, rebate or co-op program, do you run it the same way nationally? Are you painting geographic differences, channel differences, seasonal differences, and even local market dealer/retailer differences all with the same brush? Well, if you are, then you’re missing a huge opportunity.
As sales and marketing managers, we now have access to data which helps us to know a lot more about our target audiences than we used to. Use that to your advantage and create specific and targeted programs to increase the value of your marketing dollars. Segmentation is the name of the game.
So why not create sales incentive programs that address unique business needs in a local market, that recognizes a local problem or opportunity or the local social/economic graph – and do that nationally? Can you image how effective that would be?
Be Flexible: Be committed to the program outcome not the program specifics for maximum effectiveness.
The availability of new information and/or changes in major socio-economic conditions can drastically impact the effectiveness of your incentives program for any number of reasons, are you prepared to adjust your program specifics to achieve the desired sales results?
Think of the difference it would make throughout your sales channels if you were committed to the outcome of the program so much so that in the event that a natural disaster devastates several of your top producing sales territories and you choose to extend the cut-off to date for those affected.
The flexibility to make those types of small but significant changes will add a very personal element to your incentive programs and will have an impact on brand affinity, loyalty and excitement all which contribute to increased sales. Not to mention that you get to make people happy!
Be Responsive – Create and execute changes or new programs within 48hrs to capitalize on opportunity.
You must have a highly responsive incentive strategy paired with a system that is able to easily and quickly implement desired changes.
Image that one of your sales reps comes to you and says that he has a problem in a certain channel, or maybe a specific territory, or even in a single store! You need to be able to execute a sales incentive program within 48-hours to fix that problem.
Responding to problems is only one component to being responsive. Another is a proactive strategy and systems that allow you to capitalize on opportunities that present themselves before your competition has time to react.
Regardless of what industry you are operating in, business now is just too competitive to be running archaic systems and programs that are not giving you an edge.
Michael Torcasso is a Sales Channel Incentive Specialist at 360incentives.com. Connect with him on LinkedIn right