Network Incentives: Do not Reward that the best

Network Incentives:- In 2017, changes in the business model of distribution networks force us to rethink the role of incentive plans (incentive programs) within the network. It is now clear that the way brands have always developed the loyalty of distributors has become obsolete. The best salespeople in 2017 use advanced analysis tools (CRM, business software packages) to evaluate the value generated by the various partners, in order to identify where the behavioral changes allow the greatest potential for growth.  This involves making quantitative analyzes to determine the best performers and then conducting qualitative studies (surveys) to identify good practices.

Network Incentives Never Reward the Best

Moreover, since the same incentive program has different results depending on the population, these analytical tools help salespeople to determine how each incentive plan can generate behavior in a specific group and accelerate the achievement of results Desired.

The data from these tools are then used to offer each group of distributors a choice of incentive that rewards the behaviors that generate the best results. Engaging your partners in a personalized way – instead of making “one size fits all” incentive programs – and focusing on communication, will increase the efficiency of your sales process and increase your sales and your market share. The best salespersons on the network are not the only ones who need incentives

Traders of a brand know that it is important to value the best performers. Setting aside an incentive program such as a “VIP club”, which brings together the best sellers, to motivate its network, will leave 75% of the sales force of your distributors disengaged. We need to go further than simply rewarding the best. For your performance to progress to the next level, stimulate the pack.

The true growth driver of a well-structured incentive is the commitment of the entire network. Many companies settle for a club of the best, and fail to unleash the growth potential of the entire organization.

Business Challenges and Business Goals

Assuming that you have a 10% / 80% / 10% bell curve where 10% of your distributors are top performers and the last 10% are the ones that perform the least well, Gain lies in the 80% that make up the center of your distribution network. A 5% growth of the 80% that make up your median sellers brings 90% more revenue compared to a 5% growth of your best 10%. These 80% represent the greatest opportunity for growth for various reasons:

• They represent the majority of the under-exploited growth potential
• They are the largest and most diverse group in your network
• They are often motivated to improve their performance
• They are eager for knowledge and learning
• They are open to remarks and advice
• They need to build experience and skills
• They need to focus on high value-added sales activities

Identify good practices that already exist in your distribution network and define two or three behaviors that consistently deliver a specific benefit. By studying these best practices, behaviors and actions of your best salespeople, you can develop a series of metrics that allow you to better measure the performance of the bunch.

Unlike top performers, who will achieve the goals directly, the median group will apply good practices, which have proved their effectiveness. Reward them with criteria based on these practices rather than their results. For example, instead of challenging only the turnover, integrate quizzes that verify the knowledge acquired during the training sessions. These quizzes can give points that will improve the ranking of those who are invested to progress. Once you have identified these good practices and defined some behaviors that systematically bring specific benefits:

• Decide how long your incentive programs will last depending on the frequency of these behaviors (Studies show that it takes 66 days to acquire behavior)
• Offer incentives to reward these behaviors and encourage performance.
• Clearly explain the goals to be achieved, to change behaviors participants must understand exactly what is expected of them.
• Track and record both behaviors and results to give feedback to your sales people. Measuring results and providing answers (both individually and by team) will encourage desired behaviors and improve performance.
• Once the distributors have identified the behaviors that will lead them to success, unveil your incentive program. This should motivate their salespersons and managers, and direct the actions throughout the duration of the program.
• Incentive is the modern management and animation tool for distribution networks. It allows you to follow all the metrics of your network live to better manage it and promotes the rise of good practices.

Ultimately, it will be your ability to find the motivation levers of your reseller’s platoon and share best practices that will unleash the potential of your network. By creating incentives specifically designed to address this issue, you will be on the right track to increase your market share and achieve your goals. And how do you motivate your entire indirect sales force? Tell us in the comments!