Compensating Media Salespeople Goals of a Sound Compensation

Compensating Media Salespeople

Goals of a Sound Compensation System 1. 2. 3. Aid in meeting an organization’s strategic goals. Aid in communicating corporate goals, performance standards and expectations. Tie compensation directly to desired sales performance (desired behaviors). Easy to misalign incentives – • Dead Sea Scrolls

4. 5. 6. Attract and keep good people. Maintain salespeople's high motivation. – Don’t demotivate. Help in analyzing prospect potential, planning account coverage and allocating selling time.

Be understood by salespeople. 7. If they are dumb, keep it simple. If they are smart, they will understand a reasonably complex structure. – – 8. Be fair to employees. – – Don’t underpay versus competition. Be transparent. 9. Be fair to the organization. – Don’t overpay too much versus competition.

10. Provide management control. 11. Enhance teamwork, cooperation and customer delight. – Which keeps customers; gets renewals.

Guidelines for sound compensation 1. Variable portion must be large enough to justify extra effort – at least 15% of total comp. 2. Balance between security and incentive. 3. Based primarily on individual performance and effort, and directly commensurate with sales behaviors, activities and results management wants. 4. Competitive in industry.

5. Reflect the company’s sales strategy and goals. 6. Difference between high and low performers must be significant – highest at least 40% more than lowest. 7. Rewards for both hard (quantitative) and soft (qualitative such as teamwork, training) performance criteria. 8. No perceived ceiling on earnings. 9. Opportunity for reward equal.

10. Management has control over what is sold. 11. Some rewards for non-selling duties and tasks. 12. Payment should be prompt and frequent, while remaining large enough to be sufficiently motivating.

Definitions of media sales performance • Objectives of a sales force: – – To get results for customers To develop new business To retain and increase current business To delight customers

• Overall strategies of a sales force: – Create value – Research and develop insights into prospects’ and customers’ problems, challenges, pain points, and competitive positioning – Become an expert about how your medium works and solves marketing and advertising problems – Become the preferred supplier – Innovate

• Key tactics of a salesperson: – To create a differential competitive advantage – To build relationships – To solve problems

• Related functions for a sales person: – To monitor the marketplace – To recommend tactics – To cooperate

Hubspot • The ideal compensation plan is tailored to a company’s stage of growth. – Customer acquisition – Customer success and retention – Sustainable growth • Contests – – – Align with short-term behavior change. Team based Update standings daily Month long Not too many