How-do-airlines-incentivize-their-staff-to-act-ARC-Prez-Vimal-ISG-Public Release
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How-do-airlines-incentivize-their-staff-to-act-ARC-Prez-Vimal-ISG-Public Release
- 1. HOW DO AIRLINES INCENTIVIZE THEIR STAFF TO ACT AS SALESMEN? Vimal Kumar Rai Executive Director Hong Kong, 10th February 2015 @virgovim hk.linkedin.com/in/vimalraiwww.inflightsales.comvrai@inflightsales.com
- 2. Introduction to Inflight Sales Group
- 3. Introduction to Inflight Sales Group
- 4. The Airline & Inflight Retail Environment What is “selling” Why do we need to incentivize sales people? How do we do it?
- 5. The Candle Problem How can you fix the lighted candle to the wall without the wax dripping onto the table? Credit: Karl Duncker, 1945
- 6. The Candle Problem Eureka! Credit: Karl Duncker, 1945
- 7. What is sales ?
- 9. What is an “incentive”?
- 10. How are crew typically “incentivized”? Carrots Sticks • Targets & flights-based • Commissions - money • Vouchers, products, “experiences” • Training, carnivals • Timing – program cycle, monthly • Target – “All” • Targets & process-based • Commission deduction • Loss of flight privileges • Corrective Training • Timing – program cycle, monthly • Target – “All”
- 11. What is the common thread? • Extrinsic • Rewards are Physical • Punishment Psychological • Narcotic • “Pay for Performance” • Tactical • In essence, sweeter carrots and harder sticks
- 12. Limited inventory & display; limited ability to try Limited pre-information available Impulse-driven Sales staff are not hired for their selling skills Sales staff are not trained to sell (much) 20% of sales staff contribute 80% of your sales Penetration of less than 5% Peculiarities of inflight retail It’s complex!
- 13. Remember the Candle Problem? Remember “functional fixedness”?
- 14. Remember the Candle Problem? Remember “functional fixedness”? The Candle Problem Redux Credit: Sam Glucksberg
- 15. Typical categorization of sales performers 16%16% 68% Low Performers Average Performers High Performers
- 16. An Immediate interim solution… LAGGARDS • Daily Commissions • Monthly targets • Quarterly bonuses • Social Pressure CORE PERFORMERS • Multi-tier targets • Sales contests with prizes that vary in nature and value • Consistent engagement STARS • Over- achievement commissions • Speciality Experiences
- 17. What is the longer-term solution?
- 18. We need to re-think our assumptions…
- 19. Remember Maslow?
- 20. How should sales staff be inspired? • Social Media recognition • ISPY • Mobile App • Personalised goals • Personalised experiences • Brand immersion visits • Peer pressure • Product fairs • Roadshows • Trust • Equitability • Payment on time • Top Performer Prize • Tier-based commissions • Commissions • Training Notes • Newsletters Highly motivating Highly personalized Generic Pay for performance
- 21. HOW SHOULD AIRLINES INSPIRE CREW TO ACT AS SALESMEN? 1. Understand your problems and your objectives 2. Understand your target audience of crew 3. Are you trying to incentivize actions or grow sales? 4. Re-examine your assumptions 5. Inspire your crew
- 22. HOW SHOULD AIRLINES INSPIRE CREW TO ACT AS SALESMEN? Vimal Kumar Rai Executive Director Hong Kong, 10th February 2015 @virgovim hk.linkedin.com/in/vimalraiwww.inflightsales.comvrai@inflightsales.com Thank you!