It’s natural to want to reward your most effective sales team members, but there’s an issue if you do so in the wrong way. Say, for example, you have a sales team with 15 members. You have a monthly prize for the top earner; month after month, it’s a neck-and-neck race between three top performers. It’s exciting for those three to see who will emerge victorious with that last-second close, and they’re all incentivized to push themselves to their limits and beyond.
What about the other twelve members of the team? They all know that even though they have months or years of experience, they aren’t likely to earn a place at that top spot; it’s always the same three people that win. Their best efforts still aren’t enough to make that incentive bonus. So, why would they try?
You may motivate three out of fifteen workers, but the other dozen have no incentive to perform beyond their bare minimum.
There are plenty of solutions to this challenge. One of them is to use contests instead of flat performance incentives. How can you do so correctly to motivate your whole team?
Let’s get started!
Designing a Good Sales Contest
Sales contests aren’t just about rewarding your top performers. They should never reward your best employees and none of your other team members. Your sales contests should be about elevating your weaker performers and bringing the team as a whole forward. Your top performers can earn rewards in different ways, through commissions or additional performance bonuses.
It would help if you designed your sales contests more effectively and often more nuanced than your standard incentives. According to Sales Hacker, the three primary goals of a sales contest should be:
- Elevating the performance levels of your weakest sales team members.
- Increasing the overall activity levels of your sales team as a whole.
- Enhancing the morale of your sales team across the board.
A sales incentive that rewards the top performers doesn’t accomplish any of these goals unless the level of performance is so close across the board that anyone can be the strongest and weakest from month to month. That situation is rare.
So, how do you design a sales contest to promote these three core concepts?
1. Pick a relevant KPI to track and reward.
The choice of key performance indicator (KPI) you monitor is a huge influencing factor on the validity of your contests. There’s one thought you need to keep in mind above all others when designing your contests.
Reward actions, not outcomes.
If all you reward is outcomes – closed sales, for example – you reward people for natural talent, charisma, and luck. Those aren’t trainable, and they aren’t easy to combat.
Conversely, if you reward actions, you’re rewarding hard work. It may be down to luck how many out of 100 calls result in a sale, but it requires a lot of hard work to put in those hundred calls.
Specifically, you usually want to pick top-of-funnel activities (or as top-of-funnel as your sales team can get, if they’re separate from the marketing and lead generation team) to reward the input, not the output. After all, outcomes are generally already rewarded in the form of commissions.
2. Keep your performance monitoring public and in real-time.
Whatever metric you pick to monitor for your contests needs to be easily measurable in real-time. It also needs to be known to your sales team ahead of time, so they can get excited at watching it progress. Leaderboards and other methods of reinforcing monitoring can help build excitement and encourage employees to buckle down into hard work.
One potential drawback is when the gap widens between the front-runners and the rest of the pack. If it reaches a point where it’s mathematically unlikely for the people who have fallen behind to have the opportunity to catch up, their motivation drops off a cliff. Thus, another key to a successful contest is to keep it short. A shorter duration means a better sprinter can out-perform a good marathoner but still encourages hard work either way.
3. Pick a properly-balanced incentive as your prize.
It would help if you scaled incentives for sales contests appropriately for the effort put into achieving them and the time it takes to host the contest. You don’t want to award a $5,000 gift certificate or a gold watch in a contest that you run daily. On the other hand, if your reward is a $50 Amazon gift card for the top prize in a month-long contest, it might not be enough of an incentive. You want the prize to be appealing enough for your team to work towards attaining it.
We’ve written a lot about the design and scale of incentives throughout our blog, so feel free to browse around. In particular, you may be interested in whether a virtual or a physical prepaid card is better or what SPIFF incentives are.
We can’t give you a specific number for what a good incentive will be. It depends on your existing commission structure, the contest duration, the KPI you’re rewarding, the size and scale of your sales team, the frequency of your contests, the base salaries of your team, and more. You’ll need to analyze and solicit feedback from your sales team about your rewards to design the perfect incentive.
4. Maintain open lines of feedback, especially from weaker team members.
Keeping a feedback cycle is the only way to develop consistently valuable sales contests. You need to ask your team what they think of the contests if they feel motivated to compete, and if not, why not. The issues they bring to you, particularly those who don’t participate or don’t win, will help you balance your contests to motivate everyone properly.
Remember, your contests are designed to motivate and encourage the underperformers on your team, not simply give more rewards to the top earners. Thus, the feedback from the underperformers will be more valuable.
Alright! Now that you know, at least in broad strokes, how to design a contest, what can you measure and reward in your contests? Here are eight sales contests ideas that can be highly effective at motivating your sales team if you design them correctly.
1: Sales Call Raffle
One of the best ways to equalize a contest is to add an element of chance. A sales call raffle is a good example. It rewards a top-of-funnel activity – making sales calls or even cold calls – but it doesn’t simply give an award to the person capable of making calls non-stop.
One drawback of a call volume metric is that it doesn’t incentivize effective calls. If 100 calls that all fail is better than 20 calls with a 25% close rate, your team may be encouraged to be ineffective and to take the first “no” as an answer and move on.
A sales call raffle assigns a ticket for each X number of calls. It can add bonus tickets for successful calls if you want, or you can use a different contest or different reward for closed sales. Either way, the element of chance comes in the final drawing. Even someone who made half the calls your volume leader did still has a chance to win, so they’re encouraged to participate.
2: Friday Free Poker
Pick a metric to monitor, and give everyone who completes that metric a spin on a wheel with varying point values. The points are converted into poker chips, and at the end of the week, on Friday, you have a poker game with your sales team, using the chips as bets.
The choice of metric allows you to customize the contest to anything you want to encourage. The element of chance means that it encourages more activity rather than just rewarding the top earner. Then the final reward, a fun game of gambling with no real stakes, helps blow off steam, encourages underdogs to participate in a gamble to win “big,” and can reveal hidden skills of certain team members.
You do need to be careful with something like this. You don’t want to institutionalize gambling in a way that can have negative repercussions, so if anyone on your team is a recovering gambling addict, or if anyone gets way too into it, consider a different style of contest instead.
3: Daily Office Prize
To set this up, start by purchasing a dozen or so office knick-knacks and wrapping them in indistinguishable packages. Then, pick your KPI and host daily challenges during slow weeks to encourage putting in more effort. At the end of the day, the winner gets to pick a gift to adorn their office.
As an added element of encouragement, allow the day’s winner the choice of stealing the previous prize opened instead of picking a new one, white elephant style. If one employee really wants that fancy red stapler their colleague opened, well, maybe they’ll put in that extra effort the next day.
4: Volume Vacation
For this one, you need to plan ahead and know what kind of atmosphere you’re in. You want to pick a day or week that is historically slow or where motivation is usually flagging. You also want to pick a metric that encourages more volume and potential success during this time.
Pick your metrics and set a goal for the team, either per person or cumulative. The prize? Go home early! Maybe everyone goes out to the pub after work, paid for by the company. Maybe everyone is just allowed to head home. Whatever the case, set your benchmark to a difficult-but-achievable goal, and encourage everyone to reach it collaboratively.
5: Most Improved Performance Reward
Suppose you specifically want to target and encourage your underperformers. Why not reward a metric they historically don’t do well on and reward the greatest amount of improvement over a span of a day or a week?
The key to this one is to have benchmarks and personal best records for your staff, so you know what numbers are changing and how they’re improving. Your top performers likely can’t improve by enough to win it, but your underperformers certainly can.
It’s critical here to help provide assistance or training to fuel the improvement, rather than just telling everyone they get a prize for beating their previous records and leaving them to it.
6: Red Versus Blue
For this contest, pick a metric that can be improved collaboratively. Then, divide your sales team into two groups along arbitrary lines. You can use a random number generator or have everyone draw straws or whatever you like as long as the teams are even.
Have the teams compete and reward the winning team with something minor but motivating. A half day off, a catered lunch, whatever works for the team. You can even keep a small library of possible prizes and allow the team to choose.
7: Mentorship Wins
A meeting of minds can be a powerful source of training, especially if you pick the right kinds of metrics. Using your awareness of your team performance across various metrics, pick one with decent stratification.
Pair up top performers with underperformers in a mentor-mentee position. Then, reward the team (or top three teams) with the best improvement in the underperformer’s metrics. This encourages your top performers to teach how they do it and helps bring everyone up.
8: Metric Scavenger Hunt
This one is much more complex, but done right, it can be hugely motivating. Pick a list of metrics you want to monitor and relatively rare achievements, like specific upsells or hard-to-close leads. Build out your list as a “scavenger hunt,” assigning points and difficulties to each and checking off when employees achieve them. This can be an individual competition, a team competition, or a collaborative action, with prizes for each depending on what you’ve put on the list.
This one takes a lot of effort to create but can be one of the most interesting and rewarding kinds of sales contests. Give it a try!
If you need help building a customized incentives plan for your organization, reach out to us today! We’re happy to show you a few of our most successful incentive programs and how we can help.