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Non-Cash Incentives: Best Practices to Optimize Sales Effectiveness
In September and November 2012 Aberdeen Group surveyed 312 organizations about their sales effectiveness practices and accomplishments, specifically to understand how sales performance management is effectively deployed. Their findings showed that the top 20% of companies (aka the "Best in Class") had the following profile:
- 16% higher average sales quota than all other firms
- 12% average year-over-year increase in team attainment of sales quota versus a 6% decline for laggard organizations
- 10% average year-over-year increase in percentage of sales reps reaching quota versus a 6% decline for laggard organizations
- 88% customer retention rate versus 14% for laggard organizations
- 8% increase in average deal size year-over-year versus a 1.5% decline for laggard organizations
- Best in Class companies were 12% more likely than other organizations to list internal recognition for positive performance as a vital motivator to sales success.
- Best in Class companies were 11% more likely to offer verbal praise, 90% more likely to offer public recognition, and 95% more likely to offer peer-to-peer recognition for progress towards goal versus all other organizations.
- 100% of Best in Class companies offered group travel and 100% offered company sponsored events to recognize year-end sales success.
- Best in Class companies were 25% more likely than all others to offer group travel for year end sales success and 75% more likely to offer company sponsored events to recognize year-end sales success.
- Best in Class companies were 50% more likely than laggards to list teamwork as a very important part of the sales process.
- Organizations with formal internal sales employee recognition programs had 15% higher team quota attainment and 16% higher customer renewal rate.
- Over half of respondents listed non cash rewards and recognition as an important part of sales performance management
- A wide variety of efficiency-oriented metrics favor the outsourcing of incentive management, with those organizations who outsourced showing higher lead conversation rates and lower average sales cycles.