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Engagement & Performance

How to design SMART sales incentives that work

If you're reading this, you've probably already researched incentive programmes for employees or channel partners as a means to drive your bottom line. So what makes BI WORLDWIDE any different to the last agency you spoke to?

Well the answer lies in the science of Behavioural Economics – the understanding of what drives us to do what we do. Let’s start with you: you’re reading this blog because, like most of us, you're a cognitive miser. This means as a human being, you like to speed up the process of finding a satisfactory solution (known as “heuristics” in our world). Agree?

The good news is that you’ve come to the right place

What we do at BI WORLDWIDE is leverage the power of behavioural science to help companies like yours engage and motivate employees and channel partners. Our ultimate aim is to help you optimise your business performance from all angles and deliver measurable results. So how do we achieve this?

Set some goals

Goal setting provides focus, increases the rate of achievement and drives performance. It also provides purpose and a road-map of how to get there. We’ve all heard of SMART goals and how they need to be specific, measurable, attainable, realistic, and time-bound to maximise results. What makes BI WORLDWIDE's sales incentive programmes so successful is how we we combine our understanding of human behaviour with goal setting principles.

Make it ‘specific’

Specific is the “who”, “what”, “where”, “when”, “why” and “how”. But that’s just the basics. The key here is to allow your audience to personalise their sales goals and create an Idiosyncratic Fit wherever possible. In short, an Idiosyncratic Fit describes the emotions you experience when you have a positive advantage over others to earn, achieve or win a reward. If your sales incentive programme doesn't fit your audience, they won't bother to participate in it.

So it comes as no surprise that, when given the opportunity, most people will set higher goals for themselves and will be more committed to the goals they set. 550 BI WORLDWIDE GoalQuest sales incentive programmes have confirmed the effectiveness of this process - when given the choice of three goals, more than 42% selected the highest goal offered.

Ensure your incentive programme is ‘measurable’

Measuring sales progress means that your target audience can track progress and stay motivated. This will help them remain focused, meet target dates, and experience the exhilaration of getting closer to achieving their goal (known as the Goal Gradient Theory). At BI WORLDWIDE, we achieve this through the use of fun, creative and vivid measurement and communications tools such as real-time dashboards, league tables, leader boards and performance-driven communication.

Our goals can only be reached through a vehicle of a plan, in which we must fervently believe, and upon which we must vigorously act. There is no other route to success.

  • Pablo Picasso

Sales goals need to be ‘attainable’

We compete to win. If we can’t win, we don’t compete. Yes, goals should be achievable but they should also be challenging. In other words, goals should stretch your abilities but still remain possible.

Remember, people will always want to move to the next level (known as the Hedonic Treadmill). This is why it’s important to recognise and reward attained milestones whilst reminding your audience of how close they are to achieving their target. This can be accomplished through the use of gamification mechanics such as badges, social recognition and of course, targeted communication. 

Be ‘realistic’

A realistic goal represents an objective toward which your audience is both willing and able to work.  Injecting your sales incentive programme with regular tactical campaigns will not only help drive discretionary efforts but it will also make your audience feel like they have a more realistic chance of achieving their targets. Combine this with the right business tools; knowledge, communication, rewards and you have a winning formula!

Sales incentives need to be ‘time-bound’

Anchoring a sales incentive and goal within a timeframe not only helps provide focus and drive but it also makes it much easier to measure progress.

Another aspect to consider is that of rewarding greatest improvement. This can be specific to those who are new to the incentive or apply across the participant base over a series of set periods (typically a quarter of the length of the incentive).

Keep mixing it up

Mixing your sales incentives up will help you avoid the dreaded Hedonic Adaptation - a psychological phenomenon where something that initially makes us happy and engages us becomes dull and trite after a time. So go ahead and inject some buzz into your programme! Gamification, “surprise and delight” rewards and opportunities to earn bonus points are just a few examples of how you can achieve this.

Sales reward and recognition

Recognising and magnifying success is key. Thanks to social media, people expect instant gratification and social recognition can be hugely beneficial to making someone feel appreciated within the workplace. Our effective sales incentive programmes are designed to create a contagion effect, also known as Relativity Bias or “keeping up with the Joneses”.

And finally, the right rewards will make a big difference. Non-cash Hedonic Rewards that provide an Idiosyncratic Fit have been proven to impact performance more than its cash counterpart.

So, having had a brief introduction to Behavioural Economics and the scientific rigour it brings to our sales incentive programmes, maybe it’s time to get in touch and experience first-hand what makes BI WORLDWIDE different to the last agency you spoke to. It would be the SMART thing to do.

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