10 Sales Incentive Plan Examples You Can Use

You just hired a group of energetic new sales reps. They’re enthusiastic, quick learners, and ready to hustle. But a few weeks in, you start noticing something strange. Everyone’s busy, but the results aren’t adding up. 

One rep is chasing small, easy deals. Another is spending hours on long-shot prospects. And a third is stuck in endless follow-ups with no clear direction.

What’s missing isn’t effort. It’s clarity and motivation.

A well-structured sales incentive plan can fix that. It helps your team focus on what matters most, gives them a reason to push harder, and aligns their day-to-day actions with your company’s revenue goals. Without it, you risk creating confusion, burnout, or worse, complacency.

In this blog, you’ll find 10 proven sales incentive plan examples that companies across industries use to drive performance and consistency. From commission-only structures to team-based bonuses and OKR-linked rewards, you’ll see how each model works, when to use it, and how it impacts sales behavior.

If you’ve ever wondered what the best companies are doing to keep their salespeople performing at the top of their game, you’ll find your answers here.

What is a Sales Incentive Plan?

A sales incentive plan is a structured program that rewards sales reps for achieving specific performance goals. For example, a rep might earn a 10% commission for every deal they close above their monthly quota.

At its core, an incentive plan is about creating alignment between what your business needs and what your sales team is motivated to do. Instead of simply telling your reps to “sell more,” you give them a clear, tangible reason to do it.

These plans can take many forms: some focus purely on revenue, others on profitability, and many mix in activity-based or strategic goals. 

Why Are Sales Incentive Plan Examples Useful?

If you’ve ever tried building a sales incentive plan from scratch, you know it’s not as simple as picking a commission percentage and calling it a day. Between different sales roles, deal types, and growth goals, the options can get overwhelming fast.

Studying proven incentive plan examples helps you shortcut the guesswork. Instead of starting from a blank page, you get to see how other businesses, often in similar industries or growth stages, have structured their plans, what worked for them, and why.

Here’s why looking at sales incentive plan examples is so valuable:

• They help you visualize how structure translates into behavior
  
  
• They offer field-tested ideas that you can adapt to your own sales process
  
  
• They show how to align plans with specific business models or sales motions
  
  
• They reduce risk by avoiding common pitfalls others have already worked through

And most importantly? They give you a realistic sense of what motivates reps, not just in theory, but in practice.

10 Proven Sales Incentive Plan Examples

Designing the right sales incentive plan can feel like trying to hit a moving target, especially when roles, markets, and goals are constantly evolving. The good news? You don’t have to start from scratch. Below are 10 proven sales incentive plan examples that real companies are using to drive performance, boost motivation, and align reps with revenue goals. 

1. Commission-Only Plan

A commission-only sales incentive plan is one where sales reps earn income solely from commissions on the deals they close. There’s no base salary involved. The more a rep sells, the more they earn. It’s highly motivating for top performers and often used in industries where large payouts per deal are possible or where fixed costs need to be minimized.

How it works:

Reps are paid a fixed percentage for each sale. 

Commission Earned = Deal Value × Commission Rate

Best for:

• High-ticket, transactional sales (e.g., real estate, insurance, automotive)
• Independent sales agents or contractors
• Teams that thrive on competition and self-motivation

To illustrate, imagine a rep who closes three high-ticket deals in a single month, worth $10,000, $15,000, and $20,000. At a 20% commission rate, they’d earn $9,000 for the month. But if they don’t close anything the next month, they earn nothing. It’s a model built for risk-takers, rewarding big wins while exposing reps to the full weight of performance swings.

The upside of this model is obvious: costs align perfectly with revenue. But the risk is real, too. Without a base salary, reps may feel financial pressure, and new hires may struggle before closing their first deals.

2. Base Salary Plus Commission Plan

This is one of the most common sales incentive structures. A base salary plus commission plan offers reps a fixed monthly income along with performance-based incentives. It strikes a balance between financial stability and motivation, especially helpful for complex sales cycles or ramping new hires.

How it works:

Reps receive a guaranteed base salary and earn commissions on top of that for closing deals.

Total Earnings = Base Salary + (Deal Value × Commission Rate)

Best for:

• SaaS sales teams
• BDRs and AEs in inside sales
• Roles with longer sales cycles where activity alone isn’t enough

In the SaaS industry, a common comp ratio is 50/50. A LinkedIn commentary from Martin Roth, a SaaS sales leader, affirms this standard, stating: “The standard OTE breakdown is 50% base salary / 50% variable compensation.” To see how this plays out in practice, imagine a rep closes $500,000 in new business annually with a 10% commission rate. That’s $50,000 in commission. When added to their $50,000 base, it totals their full $100,000 OTE. 

This plan offers predictable income, reduces turnover, and still rewards performance, making it ideal for high-growth, team-based sales orgs.

3. Tiered Commission Plan

A tiered commission plan increases the commission rate as a sales rep hits higher levels of performance. It’s designed to reward overachievement and create strong momentum toward exceeding quota. Unlike a flat commission structure, this model gives reps a powerful reason to push beyond 100% of their targets. The higher they go, the more they earn per sale.

How it works:

Commission rates escalate based on predefined revenue or quota milestones.

Commission Earned = (Tier 1 Sales × Rate 1) + (Tier 2 Sales × Rate 2) + …

For example, a rep might earn:

• 5% on revenue up to $50,000
• 7% on revenue from $50,001 to $100,000
• 10% on revenue beyond $100,000

So if a rep closes $120,000 in deals, their total commission would be:

= ($50,000 × 5%) + ($50,000 × 7%) + ($20,000 × 10%)  

= $2,500 + $3,500 + $2,000 = $8,000

Best for:

• Experienced sales reps with high earning potential
• Roles with scalable revenue opportunity
• Teams where you want to incentivize breakout performance

Tiered plans are particularly effective for late-stage pipeline acceleration and can significantly improve revenue per rep, without raising base salaries.

4. Revenue-Based Incentive Plan

A revenue-based incentive plan rewards reps based on the total revenue they generate, regardless of the number of deals or deal types. According to BCG, companies with revenue-tied incentives often see better alignment between sales goals and company-wide financial targets.

This model encourages reps to go after larger contracts, cross-sells, and upsells, since every dollar counts equally.

How it works:
Reps earn a percentage of the total revenue they bring in, often with minimal complexity around deal type or product mix.

Commission Earned = Total Revenue × Commission Rate

For instance, imagine a rep working under a revenue-based incentive plan with a 7% commission rate. Over a quarter, they close a few high-value deals—a $100,000 annual contract, a $50,000 upsell, and a $25,000 cross-sell. 

Regardless of how these deals are structured or bundled, they earn 7% of the total $175,000 in revenue, which comes out to $12,250 in commission. This straightforward approach keeps the focus on maximizing total revenue without overcomplicating payout structures.

Best for:

• Enterprise sales teams
  
  
• Roles focused on new business acquisition
  
  
• Companies that want to drive pure revenue growth

This model keeps the math simple and the goals clear: more revenue equals more reward. But without careful guardrails, it can sometimes encourage discounting or volume-first selling, so pairing it with margin checks or deal quality metrics is key.

5. Profit Margin-Based Plan

A profit margin-based incentive plan rewards reps based on the profitability of each deal, not just the revenue it generates. It’s designed to discourage discount-heavy deals and encourage smarter selling that aligns with the company’s bottom line.

How it works:

Reps earn a percentage of the deal’s profit, not just the revenue. Typically, this is based on gross margin—calculated as revenue minus cost of goods sold (COGS)—but some companies may use contribution margin or net margin, depending on their internal reporting practices and goals.

Commission Earned = (Deal Value − COGS) × Commission Rate

For example, if a rep closes a $50,000 deal with COGS of $30,000, the gross profit is $20,000. At a 10% commission rate, the rep earns $2,000. In businesses where discounting or bundling affects profitability, using margin-based incentives ensures reps are rewarded for maintaining healthy deal economics, not just chasing volume.

Best for:

• Manufacturing or distribution businesses
  
  
• Sales teams with control over pricing or discounting
  
  
• Companies focused on sustainable growth over top-line volume

A BCG report details that pricing or margin-based metrics in incentive plans, such as comparing actual deal margins with targets, help drive profitable sales behavior and align reps' efforts with company-wide margin goals. Margin-based plans require solid backend reporting to track profitability per deal, but they offer a powerful way to align sales behavior with financial health.

6. Activity-Based Incentive Plan

An activity-based incentive plan rewards reps not just for closed deals, but for the key sales activities that lead to pipeline generation, like booking demos, making discovery calls, or sending proposals. It's especially useful when you're building early-stage momentum or want to reinforce consistent prospecting behavior.

This model helps reps stay focused on the actions that matter, even if the sales cycle is long or conversion rates are still maturing.

How it works:
Reps earn rewards based on completed sales activities, often tied to weekly or monthly targets.

Incentive Earned = (Activity Volume × Fixed Payout per Activity)

A company pays SDRs $25 for every qualified demo booked. If a rep books 20 demos in a month:

Incentive = 20 × $25 = $500

Best for:

• SDRs and inside sales reps
  
  
• Early-stage startups building a sales pipeline
  
  
• Companies with long or complex sales cycles

While activity-based incentives don’t directly reward closed revenue, they’re highly effective for keeping top-of-funnel energy high, especially in roles where reps don't control the full sales cycle.

7. Team-Based Sales Incentive Plan

A team-based sales incentive plan rewards groups of reps based on shared performance metrics, rather than individual achievements alone. It’s designed to foster collaboration, cross-selling, and collective accountability across territories, product lines, or departments.

This model shifts the mindset from “me” to “we,” which can improve culture and reduce internal competition.

How it works:

The team works toward a common sales goal, and if that goal is met, each member receives a predefined reward or bonus.

Incentive Earned = Total Team Bonus ÷ Number of Eligible Team Members

 If a regional sales team hits $1M in quarterly revenue, and the bonus pool is $10,000 for 5 reps:

Each rep earns = $10,000 ÷ 5 = $2,000

Best for:

• Regional or territory-based sales teams
• Organizations with overlapping sales roles (e.g., AEs, SEs, CSMs)
• Cultures that prioritize collaboration and knowledge sharing

This plan helps reduce friction between roles and encourages reps to support each other’s deals. But it also requires careful tracking and communication to avoid resentment from higher performers carrying the load.

8. OKR-Linked Sales Incentive Plan

An OKR-linked sales incentive plan ties compensation directly to the achievement of strategic business objectives, also known as Objectives and Key Results (OKRs). Instead of focusing solely on revenue or activity, this plan rewards progress toward broader company goals, such as entering new markets, launching products, or improving customer retention.

It aligns incentives with what matters most to the business at a given time.

How it works:
Sales reps or teams receive bonuses or variable pay based on progress toward specific quarterly or annual OKRs.

Incentive Earned = Total Bonus × % of OKR Achievement

Let’s say an enterprise rep is assigned a $5,000 quarterly bonus tied to launching in a new geographic region. If they achieve 80% of the OKR (e.g., securing two of the three required partnerships), they earn:

Incentive = $5,000 × 0.80 = $4,000

Best for:

• Strategic sales roles (e.g., enterprise, partnerships)
• Companies undergoing transformation or expansion
• Teams aligned with high-impact, non-revenue goals

OKR-linked plans help connect sales roles with big-picture business outcomes, but they require tight alignment and clearly measurable key results to be effective.

9. SPIFFs (Short-Term Incentives) Plan

A SPIFF (Sales Performance Incentive Fund) is a short-term, targeted bonus designed to drive a specific behavior or result, fast. Unlike structured comp plans, SPIFFs are temporary and tactical. They’re used to boost energy during slow periods, push priority products, or achieve quick wins before quarter-end.

Think of it as a burst of motivation with a clear, time-bound goal.

How it works:
Reps earn a fixed bonus or reward for completing a very specific task or outcome within a defined window.

Incentive Earned = Fixed Reward per Task × Number of Tasks Completed

Let’s say a company offers a $200 SPIFF for every new customer onboarded within a flash 5-day promotion. If a rep brings in 3 new customers during the period:

Incentive = 3 × $200 = $600

Best for:

• Seasonal sales pushes
• New product or feature launches
• Sluggish months or quarters

SPIFFs are effective because they’re flexible and immediate, but they should be used strategically. Overuse can create confusion or dilute long-term incentive structures.

10. Custom Hybrid Incentive Plan

A custom hybrid incentive plan blends multiple incentive models—like commission, bonuses, activity-based payouts, and team goals—into a tailored structure that fits the unique needs of your sales organization. It’s designed for companies with diverse sales roles, varying deal types, or multi-stage sales cycles where a single model just doesn’t cut it.

This approach offers the flexibility to motivate reps across different segments without forcing everyone into a one-size-fits-all structure.

How it works:
The plan is customized by combining fixed and variable components based on role, sales cycle stage, or business priorities.

Earnings = Base Salary + (Revenue Commission) + (Activity Bonus) + (Team/OKR Bonus)

 A SaaS company might use the following hybrid model for an Account Executive:

• Base salary: $4,000/month
  
  
• 5% commission on all closed revenue
  
  
• $100 bonus for each upsell to existing accounts
  
  
• $2,000 quarterly team bonus for meeting cross-sell targets

If the rep closes $50,000 in new business, secures 3 upsells, and the team hits its goal:

Earnings = $4,000 + ($50,000 × 0.05) + (3 × $100) + $2,000  

= $4,000 + $2,500 + $300 + $2,000 = $8,800

Best for:

• SaaS companies with varied product lines or multiple revenue streams
  
  
• Large sales orgs with distinct roles (e.g., hunters, farmers, specialists)
  
  
• Teams selling across geographies or market segments

Hybrid plans require more effort to manage, but when done right, they deliver precision, flexibility, and motivation across a complex sales structure.

Role-Specific Compensation Strategies

Your sales team isn’t a single unit—it’s a mix of roles, each responsible for different parts of the revenue engine. That’s why using one incentive plan across the board often falls flat. To truly drive performance, your compensation strategy needs to reflect what each role is accountable for.

Here’s how you can approach compensation by role:

Sales Development Representatives (SDRs)

SDRs focus on top-of-funnel activities like cold outreach and booking meetings. Since they usually don’t close deals themselves, activity-based plans work best. You can offer fixed bonuses for every qualified meeting or lead passed to AEs. SPIFFs are also effective for boosting short-term outreach goals.

Account Executives (AEs)

AEs are responsible for closing deals, so their comp plans should reward revenue generation. Most companies use a base salary plus commission structure, often with tiered accelerators to encourage overperformance. For higher-value deals, revenue-based or margin-based incentives can add extra motivation.

Enterprise Sales Reps

Enterprise reps handle long, complex deals that often involve multiple stakeholders. Their compensation plans usually include a base salary, plus revenue-based or profit-margin-based commissions. In some cases, they also receive OKR-linked bonuses for strategic outcomes, like landing a flagship client or expanding into a new region.

These plans typically come with lower commission rates, usually between 2% and 5%. But that’s balanced by larger deal sizes and longer sales cycles. Payouts are often spread across key milestones such as contract signing, implementation, or renewal, to reduce risk and encourage long-term success.

Customer Success Managers (CSMs)

While CSMs may not close new business, they play a critical role in renewals and upsells. A hybrid plan with retention bonuses, upsell commissions, and team-based incentives works well. You want to encourage long-term customer value, not just quick wins.

Partnership or Channel Managers

These roles are often focused on indirect revenue, such as through affiliates or resellers. OKR-linked incentives or profit-margin-based plans are effective, especially when tied to expanding partner contribution or co-selling initiatives.

Sales Leaders and Managers

Sales managers are responsible for team performance. Their incentives should be tied to collective outcomes, like quota attainment, forecast accuracy, or team retention. Team-based bonuses or MBO-style plans (Management by Objectives) give them skin in the game without encouraging micromanagement.

How to Choose the Right Sales Incentive Plan for Your Team

Once you’ve seen what’s possible, the next challenge is figuring out what’s practical for your team, your sales motion, and your business goals. The best sales incentive plan isn’t just well-structured—it’s built around how your team actually works. Here's a step-by-step approach to help you make the right call:

Step 1: Define Your Sales Goals

Start by identifying what you want your sales team to achieve. Are you focused on fast growth, profitability, retention, or new market expansion? Your plan should reward outcomes that align directly with your core strategy.

Actionable Tips:

• Prioritize 1–2 metrics: revenue, margin, retention, or pipeline.
• Avoid “goal clutter”—don’t reward too many things at once.
• Tie incentives to outcomes, not just effort.

Step 2: Match Incentives to Role Responsibilities

Not all sales roles influence the same part of the deal cycle. Build your compensation around what each role can actually control—activity, revenue, or retention.

Actionable Tips:

• Use activity-based bonuses for SDRs and top-of-funnel teams.
• Base AEs’ incentives on closed revenue or quota attainment.
• Reward CSMs for renewals, upsells, and customer satisfaction.

Step 3: Account for Sales Cycle Complexity

The longer and more complex your sales cycle, the more stability your reps need. Quick-win environments can thrive on pure commissions, but strategic sales require a mix of base salary and long-term incentives.

Actionable Tips:

• Use tiered commissions or accelerators for high-effort deals.
• Offer MBO or OKR-based bonuses for long-cycle or strategic roles.
• Protect ramping reps with draw systems or onboarding SPIFFs.

Step 4: Factor in Team Maturity and Structure

Newer teams often need simplicity and clarity, while experienced reps may thrive under more nuanced plans. Your comp strategy should evolve as your team does.

Actionable Tips:

• Start with a simple Base + Commission model for small teams.
• Layer in SPIFFs or team bonuses as the org scales.
• Reassess plan complexity every 6–12 months.

Step 5: Align with Company Stage and Financial Model

Your sales incentive plan should reflect where your company is today—and where it’s headed. Different stages of growth require different approaches to compensation. Here’s a practical framework to guide your plan selection:

Early-stage companies: Focus is on rapid top-line growth with limited overhead.

• Use commission-only or high-variable comp plans to drive performance without a fixed cost burden. 
• Great for lean teams, short sales cycles, or transactional selling.

Growth-stage companies: As the team scales, retention and repeatability matter more.

• Use a base + commission model to provide income stability while keeping incentives strong.
• Ideal for SaaS or B2B orgs expanding pipeline and team size.

Mature or enterprise-stage companies: Sales cycles are longer, deals are strategic, and roles are more specialized.

• Use hybrid plans with layered incentives—base salary, revenue or margin-based commissions, and OKR-linked bonuses for strategic outcomes.
• Best for complex sales orgs spanning geographies or product lines.

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Common Mistakes to Avoid When Designing Sales Incentive Plans

Designing an effective incentive plan isn’t just about throwing commissions at your sales team—it’s about clarity, fairness, and motivation. Here are five common mistakes that can undermine even the best-intentioned plans:

1. Overcomplicating commission structures: If reps need a spreadsheet and a calculator to understand how they’re paid, you’ve already lost them. Complex models lead to confusion and disengagement. Keep it simple, predictable, and easy to explain.
   
   
2. Setting unattainable targets: Goals should stretch your team, but not break them. Unrealistic quotas erode trust, lower morale, and eventually push top performers out the door. Ground targets in historical data, market conditions, and individual capacity.
   
   
3. Ignoring role-specific differences: SDRs, AEs, and CSMs drive value in different ways. A one-size-fits-all incentive structure doesn’t work. Align rewards to the specific KPIs and outcomes that each role influences most.
   
   
4. Delayed or unclear payouts: Timely, transparent payouts build trust. If reps don’t know when or how they’ll get paid, motivation drops fast. Define payout timelines clearly and stick to them.
   
   
5. Lack of transparency in performance metrics: Ambiguity kills motivation. Reps should always know what’s being measured and how it ties back to their comp. Regular reporting and visibility are key.

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Conclusion

You don’t need a 20-tab spreadsheet or a brand-new framework to get sales comp right. The best plans? They’re simple, strategic, and shaped by what actually moves the needle for your team. 

Pick one or two models that match your sales motion, test them with a pilot group, and refine from there. Don’t be afraid to evolve. What works today might stall tomorrow. And remember: clarity beats complexity every time. A plan your reps understand is a plan they’ll run through walls for.

Not sure where to begin? Start with what’s proven and let a platform like Everstage do the heavy lifting on structure, tracking, and scaling your incentive plan as you grow. 

Contact Everstage to book a demo now!

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