I am about to facilitate a class at the Las Vegas PPAI Expo this week on the basic psychology a promotional consultant needs to know to structure and conduct programs for their clients. Clients, both big and small, who have bought into your “pitch” ultimately depend on you and trust that you have the knowledge of human behavior to structure incentive and reward programs.
The plain truth is that few of us in our industry have a degree in industrial psychology or any field of psychology. Even those who do, will be challenged to know what motivates a millennial vs generation X, Y or a boomer, as we are now called upon to structure programs crossing five different demographic generations. Every individual, regardless of age, profession, gender etc. is internally motivated to maximize their life and survival by perfecting their skills and abilities to achieve desired results. Some will challenge motivation and incentive programs saying … “isn’t making money and keeping your job enough motivation”? These are the same people who think a traveling sales rep, who can be out of their home 40-60% of the year, is fortunate because they stay at fine hotels and dine in nice restaurants. Let’s focus on a person you may know reasonably well, you - you, the salesperson.
The salesperson has a unique need that most others in business do not have. That is the need for added motivation. Let’s remove to 5% of super achievers who will dominate and achieve through some internal furnace pushing them to earn and win.
Joe and Josephine, the sales representatives, most often work in an autonomous environment outside of hourly management control. They set their own workload, they set their own short- and long-term strategies and get little supervision. To help insure the associate works diligently towards the company goals and invests the needed effort, companies offer incentives, which is a form of control they do not get through daily sales management. This is a fact to help make a reluctant incentive buyer, who has not been in sales, realize incentives are needed.
Incentives are a regulator. They encourage sales associates to make intelligent choices in their behavior in concert with the company goals. Incentives modify performance. Incentives can shorten lunch at Panera (with free wi-fi) to stay for a half hour instead of two.
In my childhood days as a sales manager for a Fortune 500 company, I ran a " Drive at Five” program. I was trying to squeeze as much sales as I could out of my region. I started this campaign in concert with a travel incentive program that corporate was running. My logic was that just one more cold call at 5:00 each day would open doors and increase sales. Sales people know that management stays late and staff leaves on time. So, without the gatekeepers, the probability of seeing the "buyer" is greater. The incentive travel program gave my team the external motivation and the program I created gave them a strategy to accomplish the goal. 100% of my team won their trip to Acapulco and the 5 O’clock program helped them do it.
There is difference between recognition, rewards and incentives. An incentive is the promise of a reward if one’s performance achieves the goal set forth. Recognition, a subtle difference, is the appreciation given for the performance ... it is the pat on the back, it is the praise and adulation. Recognition satisfies the highest human need for self-actualization. An incentive is non-threatening, it is simply “out there” for one to earn. However, what is often thought of as the primary motivator of sales people, the “quota”, is threatening. Inherent in a quota is the fear by all salespeople that failure can cost he or she their job. Yes, fear is a motivator, but it also elicits complex emotional issues that can facilitate failure. Further, while a rep will, no doubt, keep their job if they achieve quota, it is well known that the next quota will set the bar even higher. Higher means more effort and more fear. Incentives do not carry that burden. Salespeople know the law of diminishing returns. As sales grow and market share is taken, the amount of energy needed to reach the next quota is greater and the returns may not be as robust.
By 2020 nearly 50% of the workforce will be millennials. They are the most culturally diverse and best educated workforce we have seen. Is their ignition switch the same as a gen X, gen Y or a boomer? Much is the same, but they have a few hot buttons not as pronounced in other groups. Here are general motivators and the asterisks are those that are key to millennials:
- Salary
- Clear understanding of “team/company goals”*
- Having a meaningful impact on the company*
- Feeling valued*
- Incentives
- Praise
- Involvement in community activities*
- Career growth, promotions
- Professional development*
- Personal time*
- Fear
Build your incentive programs to incorporate as many motivators as you can. As out of the box as it may seem, explore incentives that tie into a community, personal growth etc. Partner with an industrial psychologist and tout that relationship when presenting your team. Draw together a diverse focus group to probe incentives that can work for a given project. Incentives need not always be 100% tangible, allocate some of the campaign money for recognition and communication.
Do a little reading on what makes a sales person tick. Or, visit my class next time it is given. Here’s hoping you hit quota.
Joel D. Schaffer, MAS is CEO and Founder of Soundline, LLC, the pioneering supplier to the promotional products industry of audio products. Joel has 48 years of promotional product industry experience and proudly heralds “I was a distributor.” He has been on the advisory panel of the business and marketing department of St. John’s University in New York and is frequent speaker at Rutgers Graduate School of Business. He is an industry Advocate and has appeared before the American Bankers Association, American Marketing Association, National Premium Sales Executives, American Booksellers Association and several other major groups. He has been a management consultant to organizations such as The College Board and helped many suppliers enter this industry. He is a frequent contributor to PPB and Counselor magazines. He has facilitated over 200 classes sharing his industry knowledge nationwide. He is known for his cutting humor and enthusiasm in presenting provocative and motivating programs. He is the only person to have received both the Marvin Spike Industry Lifetime Achievement Award (2002) and PPAI’s Distinguished Service Award (2011). He is a past director of PPAI and has chaired several PPAI committees and task forces. He is a past Chair of the SAAGNY Foundation, Past President of SAAGNY and a SAAGNY Hall of Fame member. He was cited by ASI as one of the 50 most influential people in the industry.