I took a step back during a meeting with a fella called Paul Walker recently. He was giving me insight into how come his salesrep retention rates were the envy of his industry. And impressive they are; average tenure being seven-and-a-half years.
He believed a major reason was down to his company’s incentive approach. One element that has really got me thinking is less carrott, more in-yer-face stick. Their sales people have three separate targets, each for a different type of sale. One contributes 50% of their commission, the other two 25% apiece.
If someone fails to reach their numbers for a quarter, then any commission they’re due against the individual target, is “banked”. This means the rep does not receive their bonus at that time. They only get it when they’ve hit their targets again. Any commission so banked at year-end, is lost.
Apparently when they launched this scheme, they experienced a 15% churn of reps. Yet now, they are proud market leaders, with a queue of people wanting to join them.
Is it seriously worth considering implementing such a regime in my sales team, I wonder?