You’ve to introduce a new product in the market or have to drive a particular behavior among your sales rep. As it will be in most cases, your reps might not be pumped up to carry forward the tasks you want them to do.
So, how can you ensure that your reps don’t lack motivation?
Your answer is Sales Performance Incentive Fund (SPIF).
What is a SPIF?
SPIFs are a short-term sales incentive strategy that is used to motivate reps. The reps are rewarded for completing a specific task in a given period. Unlike commissions, SPIFs are spontaneous and aren’t planned.
For example, if your reps make a specific amount of sales in a particular time, or book a specific number of demos, then they’ll be rewarded. Remember that SPIFs aren’t something that replaces compensation plans, but are an additional incentive.
When Should You Use SPIFs?
During the Launch of a Product/Service
When you’ve to launch a new product or service, it’s important to create momentum so that the product/service gets a good start. SPIFs can play a crucial role in making reps prioritize the new offerings, while they’d also think of up-selling to the already existing customers.
When You’re Entering Into a New Market
Gaining a competitive edge when you enter a new market can be challenging. SPIFs can give your sales rep an extra push when looking for new customers as you tap into the new market.
To Accelerate Performance
Sometimes, your team would be lagging behind in reaching the sales goals. So how can you boost performance when the numbers are low? Again, implement a SPIF plan so that your existing goals are met with no further delay.
Closing Deals in the Pipeline
Certain deals may remain in the pipeline with no progress, which may be caused due to various reasons. Through SPIFs, you can ensure that your reps focus on such deals as well, moving them to the subsequent stages and finally closing the deal.
How to Implement SPIF in the Right Way
Define Your Goals
You want to create a SPIF for a specific reason. Be it to increase sales or book more demos, or promote a new product, clearly define the purpose of the SPIFs to your team. Let them know what’s expected of them, and how they can earn the incentive. They’d also want to know the numbers properly.
For example, your rep has to bring in 100 new leads by Q1 for an incentive of $1500. Detailing out on this would only help to avoid further confusion which may arise in the process.
Keep it Infrequent & Spontaneous
As said before, SPIFs are short-term incentive programs, and aren’t something that is a long-term solution. They shouldn’t be something that has to be implemented often. Also, make sure that your teams don’t know about the program beforehand to avoid any undue advantage. You can also research to know what has worked for your organization in the past and can adapt a program accordingly.
State Who All Can participate
You need to let your reps know which teams are part of the SPIF program. For example, if the SPIF is specifically for SDRs, then you should state it clearly so that there aren’t any unnecessary disputes during the program.
Determine the Incentive & Timeframe
SPIFs can be a monetary reward or other benefits like a vacation, gift card, memberships, etc. Finalize your budget and let your reps know what the incentive is. It is also important that you update your reps on what the timeframe of the program is going to be.
Analyze the Program
In the end, review your program to know how effective it has turned out to be. Has it met the outcome you predicted or has it fallen short? If the program isn’t giving you the desired results, then deep dive to analyze the reason for it. Based on this, you can modify the SPIF program when you implement it in the future.
There’s no doubt that SPIFs are an effective method to help your organization reach the goal within a given time period. Design the right program, make sure that it is fair, and communicate it to your reps properly. And, your reps are sure to be motivated in hitting any short-term targets you set, resulting in the growth of your organization.