Why sales incentive schemes go wrong – part 2

Failing sales incentivesSales incentive schemes are launched for a variety of reasons, in fact there should only be one – because it will deliver more profit to your organisation. As obvious as it may seem, very few businesses – once past the business case that is required for project sign-off – pay much attention to one of the most easily measured activities in the marketing toolbox.

And that in a nutshell is why sales incentive schemes don’t work. But if only it was as simple as that…

The likelihood is that 90% of the management time spent on planning the scheme was spent at the sexy end. Which rewards, what destination, which event options – and who will be doing the hosting!

If this sounds familiar don’t worry, you are in good company, but `getting a bigger bang for your buck` is what pays for your next sales incentive scheme so how can you ensure that it will deliver better results than its’ predecessors?


Why your sales incentive scheme isn’t working

In my previous article I talked about improving objective setting and analysing the results. In this article I’m going to cover rewards, recognition and communication.


Not communicating with your employees

Communication, or more specifically lack of communication, is the single biggest reason why sales incentive schemes fail.

All too often employees don’t know what they need to do, why they need to do it, what is in it for them and how they are doing. This leads to demoralised employees who don’t believe they will achieve anything and therefore don’t even try.

Unmotivated sales staff

Launch your incentive scheme with a big bang and keep it alive by continually communicating with your employees. Put your IT systems to work to produce performance data that can be reported to individuals in the form of personalised campaign reports, leagues, and forecasts of delights to come.  Be innovative with your reporting using personalised graphic reports, the internet/intranet, general company newsletters and any other appropriate corporate media that is available.

Rather than just leaving all the communication to HR and marketing, line managers also have a responsibility to their individual team members. Line managers should be talking to their staff and letting them know what they want them to do, telling them how they are doing against objectives, so they have an opportunity to modify their behaviour, and telling everyone when they have done it!

It is possible to run good motivation programmes without rewards but it is not possible to run them without effective communications!


Mistaking recognition for reward and vice versa

Often companies mistake reward for recognition and vice versa.

So let’s define what recognition and reward actually mean:


Recognition refers to the awards that deliver status and acknowledgement of achievement. Depending on the culture this could be anything from a badge to a top performers incentive travel trip to far-flung and exotic places.  It should be high profile and well reported to peers.

Reward refers to intrinsic reward where the value of the prize or item is paramount.  Reward catalogues, vouchers, merchandise awards, and personal travel tend to dominate this category.


To ensure the success of your incentive scheme you need to ensure that you have both elements in place. Recognition without reward is considered cynical and reward without recognition is missing a trick!

You can’t please all the people all the time, but if you survey your staff you will be able to select a range of rewards that have something for everyone at least. When your selecting your range of rewards consider your employees’ age, lifestyle and interests outside of work.

When your putting your recognition systems in place make sure that the achievement is communicated to the whole of the company, and make it a celebration. It will reinforce the behaviour that has led to the achievement not just with the individual employee but also amongst their peers and will help increase motivation and employee engagement levels.


In case you missed it – Action point checklist

In my previous article I provided a checklist of actions you need to follow to help ensure a successful sales incentive scheme. Here’s the checklist again in case you missed it.


The checklist:

  1. Set objectives
  2. Define the target audience
  3. Map the profile
  4. Research competitor activity
  5. Research reaction to historic activity
  6. Define measurement and campaign structure
  7. Develop an appropriate reward proposition
  8. Get the creative team to develop an ongoing communications strategy
  9. Draw up an implementation plan
  10. Do it!
  11. Review against objectives and adapt the scheme as needed


<< Back to part 1


Sales incentives


John Sylvester

John is responsible for the motivation division of p&mm ltd and a Director on the board of the IPM. Specialising in developing, implementing and directing many large scale staff motivation, recognition and employee communications programmes.

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