Incentive reward – the elephant in the room

One year on from an astounding election victory and the Republicans in Washington are showing the way forward with economic growth, unemployment reduction AND less people being able to afford private healthcare. Well….I guess you can’t have it all.

OR CAN YOU?

The flow through effect for Australian business is positive in every sense. 

The ASX200 is climbing with the Dow Jones, economic predictions are upbeat for 2018 and the Aussie Dollar is strong and stable.

Justifiably, management is looking to maintain current marketing spend and/or increase it to capture the imagination of their target audience subsequently improving sales and increasing the bottom line.

Good thinking, we all say – let’s get down to it and show the market how it’s done. There are plenty of opportunities out there and prospective business has never been so good.

Our major disappointment in this scenario is that this is where the momentum ends. Management just doesn’t get the fact that

Motivation = creative input = expenditure

to gain better results.

Too many marketers are overtaken by fear when they see the cost of delivering and rewarding a highly tuned incentive program. It’s not the cost of actually running the program that worries them but the cost of the reward. Let’s not forget that these guys want to be seen as heroes when it comes to reward but they lack bravado when it comes to paying for it.

 

Many will consider a set budget  to be the required amount of funding necessary  to deliver a quantifiable and well-deserved reward. Very few are thinking outside the box and looking into the “exponential growth” ether.

It’s time marketers started looking at what they need to achive and figure out the best way to reward their high achievers. If they are governed by Head Office budgets then they need to consider:

 

  • Raising qualification levels
  • Reducing the number of qualifiers
  • Change the program reward
  • Factor the cost of additional qualifiers into the earning process – i.e.

Higher sales = more revenue = more funds available for reward

It is not viable to think you can keep on providing the ultimate reward for an ever increasing number of qualifiers with the same budget that has remained static for 5 years.

Dare to be different and make the most of what the economy has to offer. Go with the flow and give the market what it is screaming for:

Recognition, creativity and above all –

Leadership.

 

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Guidelines to developing your next Incentive Program

The calendar year is heading for a close and for many companies, that means budget season. Are you among those who find yourself fighting for budget to fund employee programs?

Once upon a time, it was difficult to determine the return on investment for tactics like performance improvement programs or incentive programs. Once thought of as something “nice to have”, incentive programs today are one of very few tactics that have a measurable impact on an organisation and a clear return on investment.

Top performing companies develop their budgets from the bottom up. They are twice as likely to use income-based budgeting: based on general income, employee income or they use a percentage of anticipated incremental sales income to calculate their budgets.

General guidelines for developing your incentive program budget:

Determine whether you will run an Open-Ended Program (everyone who meets the requirements will redeem rewards), or a Closed-Ended program (fixed number of winners)

Define your fixed costs

Establish your ROI measures

If you’re running an Open-Ended program, estimate the “best case” – what if everyone meets their goal?

Determine the reward values based on performance improvement

Work with your incentive provider to set up a cost estimate. One of the best ways to attack this is to run a good/better/best set of scenarios based on participants meeting goals

While Open-Ended programs can be more difficult to budget, they’re often more motivational because everyone who improves their performance according to the rule structure will be rewarded. If you opt for a Closed-Ended program, consider pitting participant against their own previous metrics rather than against each other. When a program is unfair to a particular region or group, your participants may disengage, even while you’re announcing the program. You may need to handicap the program to even the playing field – i.e. implement a biased points value based on region and sales potential

Structuring an incentive program and determining the budget can be tricky. Partner with an Incentive Professional to ensure that your program will be effective and your budget will be accurate!

 

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SURVEYS – A CRITICAL PRODUCT MANAGEMENT TOOL

 

So you’ve just finished a major marketing strategy – perhaps it was your annual incentive trip for your high performing dealers, or maybe a short, sharp 3 month product push or even a new product launch. Either way, you put a lot of time, energy and money into it and perhaps you should send out a survey.

A very important component of successful Product Management is talking to and learning from customers.

Surveys play a key role in the product manager’s customer feedback toolbox. They are particularly suited for quickly gaining insights from a large group of customers.

Online surveys allow you to gather feedback from customers everywhere. The structured nature of surveys makes them easy to analyse and quantify the feedback.

Surveys are a good product management tool to use when you want to learn more about:

  • Strengths and weaknesses of your products
  • Prioritisation of features
  • The direction you are taking
  • Overall client satisfaction with your product or company

Getting Customers To Respond To Surveys

In order for survey data to be useful for drawing conclusions, it’s important to get sufficient people to respond to your survey. Surveys often suffer from low response rates because:

1. It’s challenging to convince even devoted customers to take the time to fill out surveys. Customers are busy and your request for survey feedback will be low on their list of priorities.

2. Survey length can make or break the success of a survey. You’d like to learn as much as possible from a survey, but customers all have limited time.

The key to getting good response rates for your survey is to express value for their time. This is where survey incentives come in

Using Survey Incentives

The reality is that everyone is busy, and taking time out of their busy schedules is something you have to earn. This is where something as simple as a $20 gift card comes in handy.

You will need to evaluate the survey responses to see if they were real, or rushed through just to get the gift card but based on the uniformity of responses for certain questions that required more thought, you will discover that the great majority of responses will be sincere. The reward simply motivated people to take the time to complete the survey.

Getting a large number of customers to respond to your survey can have a huge impact on what you learn. In addition, select a few key survey respondents as candidates for follow up calls. These respondents are particularly valuable users or users who had particularly interesting feedback. Since you’re relying on these respondents for future feedback, it is especially important to show them your appreciation for their time with a reward.

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