Create a Sales Incentive Target Weapon for Growth & Success

Make your Incentive Targets More Than a Customer Baseline +10%

Written by:
Matt Griffiths

General Manager Sales & Marketing

Matt is an experienced B2B Loyalty & Incentive program designer with over 20 years working with Australian and New Zealand brands.  Passionate about partnering with businesses to understand specific business and sales pain points, he takes a consultative approach to develop engaging solutions for customers that deliver measurable results.

Target setting and achievement criteria are a typical design “weapon” in sales incentive programs. They create an incentive framework that is easily understood and can be offered to any customer size or channel relationship you have.

However, just like the saying “Don’t bring a knife to a gunfight”, not all target types will give your program the cut-through or advantage you are after.

The right target structure will determine the incentive program outcome and customer engagement.

When I discuss target setting with clients, the initial go-to is the classic and frequently used – last year’s sales +10%.

While this target structure will ensure a ‘growth’ figure is achieved, a unilateral +10% doesn’t necessarily work for every customer. There are other factors you need to consider, such as how much of their available share of wallet is spent with your business as well as new product ranging or the ability to increase annual spending.

This is why I will often suggest it’s important to consider all target models and avoid a target structure that may overlook additional opportunities for growth by its design. The desire to achieve a target is driven by the Goal Gradient Theory, and the worst thing a target can do is disengage customers, as incremental growth or reaching the target value is simply not achievable.

There are several standard models that can be used as a first-round strategy review when reviewing target models. The time to use these can depend on sales data, customer knowledge or even platform functionality.

Program design can be a weapon for your B2B incentive program

Sales Incentive Target Structures

The targets we see implemented most often are:

GTD (Growth Target Dollars)

This is as simple as it sounds, and last year’s sales of +10% fit into this target category. However, the growth settings can be more than just a singular percentage growth figure. Allow for business-as-usual growth, the sales you should achieve without a program, and product ranges or the margin within your sales offer. There are many opportunities for sales growth you can focus on with customers to achieve the desired target.

SDT (Self Determined Targets)

Self-determined targets require a platform with functionality to cater for them. The addition of a personalised target communication plan to drive a customer towards achieving their desired reward goals. However, the ability to have the customer set their baseline to drive towards takes away some of the initial pushback of the actual number if you forecast it.

SPT (Status Points Targets)

Status point targets can provide a cost-effective way to drive a behaviour change, as the target is for emotional value and a range of reward benefits. They need to connect with the majority of the customer database and the value they spend on your business. Status targets offer reward gateways that customers can achieve through the program.

OVT (Opportunity Value Targets)

Opportunity value models need a depth of data and insights and often require the involvement of others inside your business, such as sales teams. However, this is also where inaccurate assessments can emerge. Opportunities Value targets are potential purchase power, creating a cluster of like-for-like groups, and attempting to move them into new purchase ranges.

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Selecting the Right Target Model

One of the biggest challenges of choosing the right target weapon is balancing the objectives of your incentive program outcomes and the ultimate connection to the customer base.

Models like growth targets are simple to understand, but they can miss the mark of maximising growth opportunities across your customer base. They can lead to buying cycles that can cause a drop in certain customer volume and annual spend every second year.

If you are still not sure which target structure will work for your incentive program, reach out!

Be confident in knowing that with research, scoping, and business alignment, whichever target structure is right for the incentive program design, there is no doubt they are powerful weapons in B2B incentive programs and achieving sales success.

sales incentive target graph

Frequently Asked Questions

  • A: B2B incentive programs are initiatives designed to motivate and reward business partners for achieving specific goals or objectives. These programs can be specifically designed to solve issues facing the business, such as share of wallet, customer retention or sales growth.

  • A: B2B incentive programs drive partner engagement, boost sales, foster loyalty, and strengthen relationships with channel partners. B2B incentive programs demonstrate additional forms of value presented to your customers and channel partners which set your company apart from competitors.

  • A: B2B incentive programs typically involve setting clear objectives, offering rewards or incentives, tracking performance, and providing timely recognition. By providing these additional forms of value, your customers are more incentivised to prioritise business with your brand, allowing your company a competitive edge over your competitors.

  • A: Factors include understanding partner needs, setting realistic goals, choosing appropriate rewards, ensuring program simplicity, and effective communication. 212F works with you, finding a way to turn the pain points facing your industry into growth-driving solutions.