Inside Sales Compensation & Incentive Best Practices Learn –Share -Network
Agenda <ul><li>Research & Statistics </li></ul><ul><li>Select Best Practices </li></ul><ul><li>Open Forum </li></ul>
Organizational Stages Source: Chally Group,  Principles of Sales Compensation
Sales Skills by Stage Source: Chally Group,  Principles of Sales Compensation
Comp Recommendations by Stage Source: Chally Group,  Principles of Sales Compensation
Plan Detail by Stage Source: Chally Group,  Principles of Sales Compensation
National Inside Sales Data Source: PayScale.com
SaaS Inside Sales Compensation Source: Bridge Group Inc,  Inside Sales for SaaS Companies Metrics & Compensation
Quota Basis Source: Bridge Group Inc,  Inside Sales for SaaS Companies Metrics & Compensation
Quota Achievement Source: Bridge Group Inc,  Inside Sales for SaaS Companies Metrics & Compensation
Account Team Comp Plan Sample <ul><li>This group calls on low dollar renewals, calls to close Forced Free Trials ($250-$40...
Account Manager Comp Plan Sample <ul><li>Each AM manages approx. $800K-$1 Million book and is responsible for customer on ...
AE Comp Plan Sample <ul><li>Acquisition Sales,  No renewal responsibility. May include some outside sales as needed. Selli...
Bonus Plan Sample <ul><li>B.E.S.T. Bonus – Every month that the AE achieves 150% of quota, and additional 1% of revenue is...
“ The Boiler” <ul><li>Very Low base (10 per hour)(12 per hour at senior) </li></ul><ul><li>Increasing commission rate base...
“ Classic Hunter + Farmer” <ul><li>Medium base ($30,000 base) </li></ul><ul><li>Fixed commission rate of  </li></ul><ul><l...
“ Shared Inside/Outside” <ul><li>Medium-High base ($55,000 base) </li></ul><ul><li>Fixed commission rate of  </li></ul><ul...
“ Hunter Only” <ul><li>Medium base ($50,000 base) </li></ul><ul><li>Commission rates with accelerators based on achievemen...
“ Appointment Setter” <ul><li>low base ($15 per hour) 20 to 25 hours per week max </li></ul><ul><li>bonuses for appts set ...
 
 
Upcoming Events <ul><li>Wednesday, May 25 </li></ul><ul><ul><li>AA-ISP Seattle Chapter Happy Hour </li></ul></ul><ul><ul><...
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Inside Sales Compensation & Incentives Best Practices

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American Association of Inside Sales Professionals (AA-ISP) Seattle chapter webinar on April 26, 2011

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  • Awarding sales compensation is a lot easier when you are able to keep accurate records for each member of the team and present it easily. I'd recommend keeping track of sales in this easy to use template: http://www.oneclickstatements.com/commission-statements.html

    Rita R.
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Inside Sales Compensation & Incentives Best Practices

  1. 1. Inside Sales Compensation & Incentive Best Practices Learn –Share -Network
  2. 2. Agenda <ul><li>Research & Statistics </li></ul><ul><li>Select Best Practices </li></ul><ul><li>Open Forum </li></ul>
  3. 3. Organizational Stages Source: Chally Group, Principles of Sales Compensation
  4. 4. Sales Skills by Stage Source: Chally Group, Principles of Sales Compensation
  5. 5. Comp Recommendations by Stage Source: Chally Group, Principles of Sales Compensation
  6. 6. Plan Detail by Stage Source: Chally Group, Principles of Sales Compensation
  7. 7. National Inside Sales Data Source: PayScale.com
  8. 8. SaaS Inside Sales Compensation Source: Bridge Group Inc, Inside Sales for SaaS Companies Metrics & Compensation
  9. 9. Quota Basis Source: Bridge Group Inc, Inside Sales for SaaS Companies Metrics & Compensation
  10. 10. Quota Achievement Source: Bridge Group Inc, Inside Sales for SaaS Companies Metrics & Compensation
  11. 11. Account Team Comp Plan Sample <ul><li>This group calls on low dollar renewals, calls to close Forced Free Trials ($250-$400 subscriptions) and attempts to cross-sell other products in 1-2 calls. </li></ul><ul><li>Base: $10-$13/hour (Please note this group is in Penticton, BC – adjust for market) </li></ul>Source: Bongarde Safety via Joyce Juntunen, Director of Sales & Service
  12. 12. Account Manager Comp Plan Sample <ul><li>Each AM manages approx. $800K-$1 Million book and is responsible for customer on boarding, training, engagement, renewal, up sell, cross-sell to existing book </li></ul><ul><li>Base: $40K-$55K per year depending on tenure </li></ul><ul><li>Target at 100%: $60K-$75K </li></ul><ul><li>Must sell 75% of cross-sell quota to earn commissions </li></ul>Source: Bongarde Safety via Joyce Juntunen, Director of Sales & Service
  13. 13. AE Comp Plan Sample <ul><li>Acquisition Sales, No renewal responsibility. May include some outside sales as needed. Selling SaaS, online and print subscriptions as well as transactional sales. </li></ul><ul><li>Base: $40K-$50K per year </li></ul><ul><li>Target at 100%: $65K-$75K </li></ul><ul><li>Target at 125%: $95K </li></ul><ul><li>Must sell 75% of quota to earn commissions </li></ul>Source: Bongarde Safety via Joyce Juntunen, Director of Sales & Service
  14. 14. Bonus Plan Sample <ul><li>B.E.S.T. Bonus – Every month that the AE achieves 150% of quota, and additional 1% of revenue is set aside and paid out in December as a bonus </li></ul><ul><li>Bonuses – All employees are eligible for annual bonus based on company performance against goals. Based on individual goals attainment and management discretion, employees can earn 0-300% of target. </li></ul>Source: Bongarde Safety via Joyce Juntunen, Director of Sales & Service
  15. 15. “ The Boiler” <ul><li>Very Low base (10 per hour)(12 per hour at senior) </li></ul><ul><li>Increasing commission rate based upon quantity of sales that happened that week only 8, 10, 12, 14% </li></ul><ul><li>Monthly contests for low-cost electronics and sports tickets </li></ul><ul><li>New Account targets were assigned </li></ul><ul><li>Renewal Customer Accounts were assigned and paid the same </li></ul><ul><li>Pros </li></ul><ul><li>Low payout for non-producers </li></ul><ul><li>Extremely performance based </li></ul><ul><li>Rewards only producers </li></ul><ul><li>High sense of urgency for reps to be productive every minute </li></ul><ul><li>Easy to distinguish performers </li></ul><ul><li>Inexpensive model </li></ul><ul><li>Cons </li></ul><ul><li>Hard to recruit candidates </li></ul><ul><li>High burn out rate </li></ul><ul><li>High unplanned turnover </li></ul><ul><li>High performers rarely stayed beyond 12 months </li></ul><ul><li>Became a farm team of employees for other companies to poach </li></ul><ul><li>Undefined territories </li></ul>Source: James Gallagher, ValueVine
  16. 16. “ Classic Hunter + Farmer” <ul><li>Medium base ($30,000 base) </li></ul><ul><li>Fixed commission rate of </li></ul><ul><li>10% for new accounts </li></ul><ul><li>5% for renewal accounts </li></ul><ul><li>quarterly contests for bonuses and bragging rights </li></ul><ul><li>New Accounts were a free for all in the CRM (claim only up to 300) Renewal accounts were your own from the prior year </li></ul><ul><li>Pros </li></ul><ul><li>still payout for non-producers </li></ul><ul><li>Bigger rewards for producers but more balanced </li></ul><ul><li>Very performance based </li></ul><ul><li>Medium sense of urgency for reps to be productive </li></ul><ul><li>Easy to distinguish performers </li></ul><ul><li>Reasonably inexpensive model  </li></ul><ul><li>Cons </li></ul><ul><li>Medium burn out rate </li></ul><ul><li>Medium unplanned turnover </li></ul><ul><li>High performers did not stay beyond 24 months </li></ul><ul><li>Undefined territories </li></ul>Source: James Gallagher, ValueVine
  17. 17. “ Shared Inside/Outside” <ul><li>Medium-High base ($55,000 base) </li></ul><ul><li>Fixed commission rate of </li></ul><ul><li>8% for inside sales 15% for outside sales rep </li></ul><ul><li>no contests other than president’s club (150% of quota) </li></ul><ul><li>accounts were assigned by geographic territory and teamed with 1 inside and 1 outside </li></ul><ul><li>Renewal accounts were your own from the prior year </li></ul><ul><li>Pros </li></ul><ul><li>still payout for non-producers </li></ul><ul><li>Bigger rewards for producers but balanced </li></ul><ul><li>Very performance based </li></ul><ul><li>Medium sense of urgency for reps to be productive </li></ul><ul><li>Each pairing is accountable to one another </li></ul><ul><li>Very defined territories </li></ul><ul><li>Low burn out rate </li></ul><ul><li>Low unplanned turnover </li></ul><ul><li>High performers stayed several years </li></ul><ul><li>Cons </li></ul><ul><li>Expensive model </li></ul><ul><li>Harder to distinguish performers </li></ul><ul><li>If inside rep underperformed it effected the outside rep </li></ul><ul><li>If the outside rep underperformed it effected the inside rep </li></ul><ul><li>No way to tell how much geography plays into performance </li></ul><ul><li>Underperformers were continually let go and replaced every 6 months </li></ul>Source: James Gallagher, ValueVine
  18. 18. “ Hunter Only” <ul><li>Medium base ($50,000 base) </li></ul><ul><li>Commission rates with accelerators based on achievement </li></ul><ul><li>8%-14% for new accounts </li></ul><ul><li>same commission rates for up-sells </li></ul><ul><li>0% for sale-size renewal accounts </li></ul><ul><li>quarterly contests for bonuses and bragging rights </li></ul><ul><li>New Accounts were a free for all in the CRM, plus 100 marquis targets (claim only up to 250 at a time and then work those) </li></ul><ul><li>Renewal accounts were your own from the prior year </li></ul><ul><li>Pros </li></ul><ul><li>some payout for non-producers </li></ul><ul><li>Bigger rewards for producers </li></ul><ul><li>Performance based and retainment based </li></ul><ul><li>Medium sense of urgency for reps to be productive </li></ul><ul><li>Easy to distinguish performers </li></ul><ul><li>low burn out rate </li></ul><ul><li>low unplanned turnover </li></ul><ul><li>High performers stayed as long as they were getting paid </li></ul><ul><li>Cons </li></ul><ul><li>More expensive than other models </li></ul><ul><li>Need to create sense of urgency through culture </li></ul><ul><li>Undefined territories </li></ul>Source: James Gallagher, ValueVine
  19. 19. “ Appointment Setter” <ul><li>low base ($15 per hour) 20 to 25 hours per week max </li></ul><ul><li>bonuses for appts set </li></ul><ul><li>$30 each for first seven in 2 weeks, $60 each for eight or more in those two weeks </li></ul><ul><li>addtl $100 bonus for deals closed that were your appt </li></ul><ul><li>Assigned Accounts in the CRM (400 max at a time) </li></ul><ul><li>Pros </li></ul><ul><li>Very low payout for non-producers </li></ul><ul><li>nice rewards for producers </li></ul><ul><li>Performance based </li></ul><ul><li>high sense of urgency for reps to be productive every week </li></ul><ul><li>Easy to distinguish performers </li></ul><ul><li>Less expensive model </li></ul><ul><li>Natural sense of urgency </li></ul><ul><li>Cons </li></ul><ul><li>Hard to recruit candidates </li></ul><ul><li>high burn out rate </li></ul><ul><li>high unplanned turnover </li></ul><ul><li>High performers stayed up to a maximum of 10-12 months </li></ul>Source: James Gallagher, ValueVine
  20. 22. Upcoming Events <ul><li>Wednesday, May 25 </li></ul><ul><ul><li>AA-ISP Seattle Chapter Happy Hour </li></ul></ul><ul><ul><ul><li>Lot No 3 in Bellevue, 5:30 – 7:30 p.m. </li></ul></ul></ul><ul><li>Wednesday, June 15 </li></ul><ul><ul><li>AA-ISP Seattle Chapter Meeting </li></ul></ul><ul><ul><ul><li>Columbia Tower Club in Seattle, 7:30 – 9:00 a.m. </li></ul></ul></ul><ul><li>Questions? </li></ul><ul><ul><li>Matt Heinz, Seattle chapter president </li></ul></ul><ul><ul><li>[email_address] , 877-291-0006 </li></ul></ul>
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