Warning signs that your SPIFF program engagement may be dropping

  • January 24, 2017

The world of sales incentive program management is changing. The move to digital data integration between channel partners and brands gives organizations greater insights into SPIFF performance. This increased transparency empowers brands to evaluate their SPIFF initiatives in near real-time, allowing for faster adjustments and greater value creation. However, this functionality alone is a starting point. Now that brands have the data they need to identify what is going on in the channel, they must also work to understand what the warning signs of SPIFF disengagement are so they can act before problems escalate.

Three of the most prominent signs that SPIFF engagement may be dropping are:

“Brands can counter low claims by altering their SPIFF strategies.”

1. Claims have hit an all-time low
Some fluctuation in sales claims is to be expected as part of a SPIFF program. A variety of factors can come together to create variance when it comes to SPIFF claims, so be careful not to overreact to a couple of declines in the number of claims being made. However, if you start noticing continued downward momentum – to the point that claims are hitting major lows – it may be time to take a closer look at what you are doing. When you have reached such a worrying point, brands can take the time to re-engage with channel partners to identify why they aren’t selling the product or what about the SPIFF program seems problematic to them.

With the right knowledge in place, brands can counter the low claims by altering their SPIFF strategies and communicating that change across the entire channel. From there, organizations have an opportunity to minimize potential damages by getting the SPIFF program back on track and ensuring a boost to sales.

2. Store managers are communicating problems
Simplified communication between brands and channel partners makes it easier to get feedback. In the past, organizations may have heard from a few managers they were close to, but had a difficult time getting a sense of what was going on across the entire channel. With modern channel management tools in place, store managers can provide their thoughts with relative ease, creating a much clearer idea of how people are responding to SPIFF programs. Very simply, if the managers you depend on to get their sales teams to push your product are complaining, you really need to listen. They can be your greatest advocates if you can get them behind you, but they also can limit your potential if they share problems and you ignore them.

While it’s important to be responsive as store managers share concerns, brands must also be careful not to jump on every piece of feedback they get and change strategies over and over again. Instead, use communications from managers as a starting point to follow up across the channel with surveys, general requests for feedback and similar strategies that will provide greater breadth to your insights. This is easier than ever with digital tools for channel management, and gaining this broad view of feedback lets you identify not only the scale of any problems, but also if any other dynamics are impacting responses to the SPIFF program.

For example, following initial feedback with further analysis can help brands identify region-specific concerns that are an issue for some managers, but aren’t a problem elsewhere. Similarly, they may be able to identify if a complaint they’re getting is only coming from major retailers and not their smaller partners and vice-versa. Initial comments from store managers can be invaluable, and the insights gained by a channel management platform can take that information to another level.

“Digital data is transforming how brands interact with the channel.”

3. Buyer’s aren’t writing up new purchases
When your channel partners buying inventory from you aren’t writing up new purchase orders, it probably means they either have plenty of items in stock or don’t see new demand rising. Either way, it’s an indication that your SPIFF program is on the brink of going downhill because your products aren’t gaining the necessary traction for buyers to purchase new goods.

Like the previous points mentioned, modern channel management software platforms offer an added value when identifying this problem signing by providing deeper insights. In the past, one of your departments may have noticed a lack of new purchase orders coming in from a few partners, but you wouldn’t have been left with enough data to identify why that is happening.

With only limited data, it’s entirely reasonable to think your product just isn’t moving well in one market and you don’t have a systemic problem. This is where getting more data and more feedback is helpful. Not only do you receive the warning sign faster because data is moving to your departments quickly, you also obtain information from varied sources, letting you respond in the most effective way possible.

Digital data is transforming how brands interact with the channel, and modern platforms can help organizations identify warning signs that a SPIFF program isn’t driving engagement and respond intelligently.

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