Why Sales Incentives Don’t Work (And What To Do About It)

Conventional wisdom is a powerful thing but it is also frequently and horribly incorrect. As human beings, most of us are definitely motivated by rewards. But, when it comes to using sales incentives to “motivate” sales people, the misconceptions abound.
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I’ve written before about the futility of trying to “motivate” salespeople. If a salesperson needs to be motivated, he/she shouldn’t be on your team. Period. End of story. If you can’t change your people, change your people. As my business hero, Marcus Lemonis, says, “People. Product. Process.” Businesses tend to spend way too much time on the Product part and not enough time on the People part. And when it comes to Sales People, it’s all too common to see them as interchangeable cogs in a machine that only requires a little grease now and again to make it move faster.

Great salespeople need no motivation outside of themselves to consistently perform at a high level. I speak from experience here. Some of the top performing salespeople I’ve led over the years had absolutely no idea where they stood in relation to their annual bonus attainment as the year drew to a close. Sure, they loved getting the bonus every year – in fact, they expected it. But, the way they got it was to work themselves into the ground and then wait and see what their bonus was. I kid you not. And guess what? Their bonus was always the largest among the team members.

Most great salespeople care about two things above all else: winning and pleasing their customers. It’s in their DNA. They jump out of bed every day and attack their jobs with gusto. They do it because that’s who they are and not because someone else is “driving” them. By the way, whenever I see a business plan that has the phrase, “drive sales by doing ____,” I want to throw up in my mouth. These plans are written by people who don’t have a clue how to achieve outstanding sales results year after year. But I digress. The very best sales people will walk through walls to please their customers (and they do it of their own accord). They will work long hours to keep their promises. And, yes, they expect to be rewarded for their efforts. The primary job of a sales leader, therefore, is to find and keep these people – not to create clever ways to motivate them.

Let me pause to clarify something. I am not saying you should not offer sales incentives and bonuses to your top performers. Quite to the contrary. Just don’t go around thinking you can get an average or mediocre salesperson to improve their performance because you hold out some juicy carrot.

So what can you do? There are far better ways to accelerate your sales results. Assuming you have great sales people to start with, ask yourself (and maybe a few sales team members) some of these questions below. A word of caution here – if you’re not 100% committed to solving the deficiencies you uncover, don’t even go down this path. You’ll end up doing more harm than good by giving your sales team false hope.

1) Does your sales team have the tools and resources to do their job well?
2) Are you making it easier or harder for them to keep their promises to their customers?
3) Do they have realistic sales goals?
4) Do the goal posts keep moving?
5) Are the rewards for keeping and maintaining your best customers commensurate with acquiring new customers?
6) Do you routinely provide recognition of top performers among their peers – especially at company-wide gatherings?

Some of the things on this list cost very little, and those that do cost money offer a much higher return on investment than offering more “incentives” to your sales people.
Lastly, please consider the wisdom offered in this great Ted Talk by Daniel Pink called “The Puzzle of Motivation.” It’s a good place to start if you’re ready to start seeing sales incentives in a whole new light.

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