It is important to effectively structure incentives to manage sales reps.
Key incentives for a sales rep
- Base Salary, Quota, Commission Rate, Variable Pay, On-Target Earnings
- Incentivize sales reps to continue doing better after hitting expectations.
- Because average team attains 70% of total team quota, managers need to have a quota set at 80% of team quota.
- This enables sales managers to work harder.
To prevent conflict, specialize sales reps to particular territories.
Ways to divide up the world:
1. Geographical territories
2. Industry verticals
3. Round-robin (useful for small teams)
Dealing with Expansion and Renewals
- Original Owner
- Let account renewals stay with original owner
- Give reps ownership to particular geographic territories
- Customer Success Manager
Full cost of sales team can be close to 50% of sales.
Thus, it is important to be aware of various variables to ensure everyone in sales is given proper incentives to succeed.