Category: Sales Compensation Plan

Often, sales operations face challenges and problems. Such problems may come from different scenarios that lead to sales. Sometimes, salespeople don’t perform well; could it be because the motivation plan isn’t doing the magic?Another problem could be an unrewarding campaign promotion. This is to name a few of the issues that regularly occur.

When these issues arise, the sales department mostly sees the motivation plan as the source. The reason isn’t farfetched; it is easy to point to the scheme as the source because salespeople bring the largest share of sales to the company and if they are not performing well, it’s because they are not motivated enough. So, the first step at getting back high sales is to give them more money through the incentive plan.

Is this sequence the right one? Should be incentive scheme be the first plan to be scrutinized when there is an existing problem to solve?

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Key Takeaways You Will Read in this Blog

✅ Incentives aren’t always the culprit – When sales drop, it’s easy to blame the bonus plan, but the root cause may lie elsewhere.

✅ Skill gaps often go unnoticed – Lack of training, unclear roles, or weak product-market fit can severely impact sales performance.

✅ Holistic strategy matters – A strong incentive plan must be paired with proper enablement, clear targets, and support systems.

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There are specific facts and points one must consider when trying when trying to sell a plan to salespeople. To create market demand and sell products, salespeople are depended upon by sales organization today to achieve this market input/output. This is an essential part of how the system works in most marketing environments, especially in Business-2-Business (B2B) situations.

Also, the maturity cycle and selling model of the company significantly affects whether salespeople are required to push the company’s agenda. Some companies are old enough with enough publicity on their products not to need a large sales force to create awareness about them. Sales management is an integral part of a company as it assists in steering the sales behaviors of consumers in a specific direction that benefits the sales motivation plan.

To understand salespeople, it must be taken into consideration that they exude emotions about matters which affect them. Their behavior is affected by these matters, especially in a case where there are incentives involved for them to benefit from financially. And if there happens to be an unfavorable situation involving them, which can affect them negatively, they tend to feel emotions of disappointment, betrayal, and anger.

Key Takeaways you Need to Remember

✅ 1. Salespeople don’t just need a plan — they need a reason to believe in it.
If you’re changing their compensation model, explain the why clearly and empathetically. Lack of clarity breeds mistrust and disengagement.

✅ 2. Poor communication can break even the best-designed incentive plan.
Before rolling it out, ensure every detail — goals, financial impacts, and new terms — is explained thoroughly and transparently.

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Companies regularly seek to increase the revenue without a bogus increment in the expenses. Motivation scheme is one suitable way for achieving this, and we have discussed the pros and cons of the plan in earlier chapters. Even in cases where targets are challenging, this scheme can work magic and shoot up revenues.

What you will learn in this article

1. Big Incentives Don’t Guarantee Big Results
   Simply spending more on commissions doesn’t ensure higher sales. If incentives aren’t strategically aligned with realistic goals and individual performance, they become a liability—not a growth driver.
2. Misaligned Targets Undermine the Entire Strategy
   When sales goals don’t reflect broader company objectives, even a well-funded incentive plan will fail. Proper alignment is essential to drive the right behaviors and achieve sustainable growth.
3. Retention Starts with Fair, Motivating Plans
   High turnover among new sales hires often signals unrealistic expectations or poorly structured rewards. Companies must invest in thoughtful, flexible plans that reward effort and promote long-term loyalty.

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Companies pay huge commissions (in any form including bonuses as I analysed HERE) to the salespeople to achieve this aim. A good question to ask is; is it worth it? Well, maybe yes, maybe not. Nevertheless, all companies pay commissions or bonuses which might either be in the form of incentives or not, to all salespeople. Whether or not it all works as intended depends on the planning and execution of the plan. A dedicated team should be formed to oversee the strategy. Specific measures should be taken to ensure the efficiency of the system and task the sales management when necessary for further actions.

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Are you tired of one-size-fits-all incentive plans that only focus on hitting revenue targets? If so, you’re not alone. Many sales leaders now realize that blending qualitative measures with sales incentives can create a more powerful and balanced compensation strategy. In fact, according to a recent survey by the Harvard Business Review, over 40% of high-performing sales teams use a combination of tangible and intangible metrics to drive growth. By introducing qualitative measures that go beyond raw numbers, you can motivate your team to excel in ways that not only boost revenue but also foster long-term customer satisfaction.

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Key Takeaways: Balancing Quantitative and Qualitative Sales Incentives

• Balancing qualitative and quantitative measures leads to a more comprehensive view of sales performance, ensuring both immediate revenue targets and long-term relationship-building are rewarded.
• Clearly defining qualitative goals—such as improving customer satisfaction or brand visibility—allows teams to set actionable milestones and measure success, even if they’re not strictly numerical.
• Keeping the incentive plan simple and transparent—by focusing on a small set of well-communicated goals—ensures sales teams understand how their efforts will be evaluated and rewarded.

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Why Sales Incentives Need Qualitative Measures

Traditional incentive plans often rely solely on cold, hard numbers—meeting quotas, hitting monthly revenue goals, or pushing product bundles. While these quantitative measures are essential, they don’t capture the entire performance picture. Sometimes, retaining a key client or nurturing a promising new lead requires soft skills, building relationships, and demonstrating strong customer care.

• More Holistic Approach: Qualitative measures help you evaluate factors like customer satisfaction, brand awareness, and overall relationship-building activities. These elements can influence sales performance as much as pure revenue growth.
• Long-Term Benefits: Measures such as improving customer experience or expanding into a new territory might not produce instant revenue spikes. However, they often yield considerable returns down the road.
• Team Engagement: Sales reps can feel more ownership when they know their efforts in client retention, product education, and brand advocacy are being recognized and rewarded.

Example: Think of a salesperson who consistently keeps existing clients satisfied but doesn’t always make the highest revenue numbers. If your incentive plan is based only on immediate revenue, you might overlook the crucial role this person plays in client retention and repeat business. Integrating qualitative measures ensures their efforts are acknowledged, encouraging others to follow suit.

Choosing the Right Qualitative Measures

Before diving in, you need to identify what elements matter most to your business. Ask yourself which objectives will truly drive growth and align with your overall goals. Below are some popular qualitative measures to consider:

1. Customer-Related Measures
   • Improve overall client satisfaction
   • Successfully upsell or cross-sell products to existing customers
   • Capture specific competitor market segments or niche audiences
   • Set milestone goals for high-value clients
2. Industry-Related Measures
   • Penetrate new markets or sectors
   • Increase brand awareness at industry events
   • Develop and launch innovative products
   • Secure strategic accounts that align with future business objectives
3. Territory-Related Measures
   • Form beneficial partnerships with local brands
   • Raise brand visibility within a specific region
   • Optimize your presence at regional tradeshows
   • Collaborate with local influencers or business networks

Buy my book HERE to learn how to design the most effective sales incentive program for your salesforce.

How to Set Targets for Qualitative Measures

You might wonder how to measure something like “enhancing brand awareness in a new region.” Unlike revenue totals, you can’t just set a numerical figure and watch the dashboard. However, you can still establish clear benchmarks:

1. Define Specific Milestones: For improving brand awareness, track social media mentions, local partnership sign-ups, or event attendance.
2. Use Surveys and Feedback: Gather direct customer opinions or post-meeting feedback to gauge relationship quality.
3. Create Action-Based Goals: Instead of saying “improve meeting quality,” set a goal such as “conduct in-depth discovery sessions with at least five key accounts each quarter.”

In many cases, a mix of quantitative and qualitative milestones works best. For instance, tie a percentage of the payout to revenue goals while allocating another portion to milestones like a boost in customer satisfaction scores or better brand perception.

Balancing Quantitative and Qualitative in Your Incentive Plan

You don’t have to abandon numeric targets to embrace qualitative measures. Instead, balance them:

• Keep It Simple: Avoid overwhelming your sales team with too many metrics. Focus on one or two strategic qualitative goals alongside core revenue targets.
• Transparency Is Key: Ensure everyone understands how you will measure success. Clearly communicate the criteria, timeline, and rewards.
• Reward the Right Behaviors: Align each goal with a particular payout structure. For example, if maintaining high customer satisfaction is crucial, consider awarding a quarterly bonus for an above-average Net Promoter Score (NPS).

Case Study Example: A fast-growing tech startup wanted both market share expansion and happier customers. They offered a flat commission rate on sales (quantitative) plus a bonus for achieving a 10% rise in customer retention (qualitative) each quarter. This combined approach led to a 17% increase in long-term revenue after six months.

Conclusion and Call to Action

Blending qualitative measures with sales incentives can transform your team’s mindset from purely chasing numbers to delivering well-rounded, strategic outcomes. By focusing on customer relationships, brand awareness, and long-term growth, you empower your sales force to contribute in meaningful ways that drive sustainable success.

Ready to rethink your incentive strategy? Contact me today to learn how our proven expertise in designing mixed incentive plans can help you cultivate a motivated sales team that consistently meets—and exceeds—your company’s goals.

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