The Sales persons in your sales team needs to be compensated for every incremental effort that they put in the process of achieving your sales targets. The important thing here is to first list down all the sales metrics on which a salesperson can exhibit incremental efforts.
- Min No of Sales Calls / day (MNOC) – New Contacts
- Mean Time Between Sales Calls (MTBC)
- No. of demonstrations given / roadshows organised
- No. of complaints handled
- No. of touchpoints serviced for customer to reach
- Customer Satisfaction Index
- Lead Engagement Index
- Reference Sale Quotient
- Cross Selling Index
- Up Selling parameter
- CRM sales ratio
- Leads : Opportunity Ratio in the Sales Funnel
- Opportunity : Proposals Ratio in the Sales Funnel
- Opportunity : Negotiation Ratio in the Sales Funnel
- Negotiation : Order Ratio in the Sales Funnel (Closing Ratio)
- No of Marcom elements used to reach out to the target group (TG) of customer
- Wallet share
- Customer Retention percentage
- Product Mix (SKU) in Sales figures
- Time invested in Learning and Development
- Contribution analysis
- Percentage of planned revenue achieved
- Life Time Value per customer
- Discount percentage offered
- Revenue by geography / market segment / category
- Cost of selling per user
- Average revenue per sales partner
- Time spent on selling vis a vis other activities
- No of Sales Manager per seller
- Rate and Quality of new opportunities added in pipeline
Can Sales happen with any one of these metrics not getting affected?
Isn’t it prudent to incentivise these metrics as they evolve rather than incentivise finaldestinationof sales ?
What should be the fixed component of compensation to the sales person?
The fixed component of compensation must take care of all fixed expenses of the salesperson. If the fixed expenses of the salesperson is higher than what he deserves , don’t recruit such people who live beyond their means.
How should we compensate for the evolving sales metrics?
Point system is desirable. The points can be redeemed periodically.
The next time, you sit down to design the compensation for your sales team, you must give cognisance to the sales metrics mentioned in this blog.