Incentive Triple Threat

By Malcolm Fleschner

When it comes to sales incentive programs, managers essentially have three reward options: travel, merchandise and cash. But which is right for your team? Choose correctly and the rewards – motivated salespeople blowing through quotas, increasing margins and making you the envy of your peers – are many. Choose poorly, however, and you might wind up with a dispirited team grousing about goals being set too high. To help you make the right choice sales writer Nora Wood breaks down the pros and cons of all three options.

  1. Travel
    Ideally, the travel rewards you offer will entice your salespeople with the prospect of trips to exotic locales – places they wouldn’t normally visit on their own. Being there together also will increase their sense of team spirit and camaraderie. That’s the upside. On the downside of the ledger, remember that many salespeople travel plenty already and might not relish the prospect of yet another trip. If you are determined to offer travel incentives, make sure to include a variety of options, Wood says.
  2. Merchandise
    Merchandise offers what experts call trophy value – a physical embodiment of achievement. Unlike travel, however, merchandise’s cash value is more easily ascertained. So unless you offer genuinely high-end, top-quality items your salespeople might not be impressed. One effective strategy is to use merchandise for intermediate achievements, instead of the big prize. This way your medium performers will have realistic prizes to shoot for, even if they know they’re not going to sell their way to Hawaii this year.
  3. Cash
    No one’s ever going to complain about receiving a cash reward, that’s for sure. It’s also easy to administer a cash-based program. But is it the best incentive? Many winners simply add the total to their other compensation, so the trophy value is nonexistent. Also, giving cash is a good way to inspire envy and conflict among team members prone to comparing themselves against one another. A workable compromise is to offer gift certificates or personalized debit cards instead of cash.