38. What can serve as an incentive to improve sales? What are advantages / disadvantages of sales incentive programs.

An incentive program is a formal scheme used to promote or encourage specific actions or behavior by a specific group of people during a defined period of time. Incentive programs are particularly used in business management to motivate employees, and in sales to attract and retain customers.

Incentive websites, also known as get "paid-to", "paid-per-click" or, more generally, "referral" sites. A website which pays people in gifts or cash for completing provided offers and referring other people. These sites are sponsored by companies in order to advertise their products. The sites are in turn paid for advertising and attracting new clients. By collecting user data that the user submits, companies can target certain areas of clientele and offer products accordingly.

What can serve as an incentive to improve sales? What are advantages and disadvantages of sales incentive programs?

Increasing sales in one of the top priorities for companies the world over. The matter is that without the sales there is no company and that means there is a definite need for ways in which to increase the sales without spending millions of dollars on advertising campaigns.

Incentive programs that are aimed at the customer are one of the best methods for improving the sales numbers.

Travel incentives have proved to be a powerful tool for increasing sales. Organizations can develop programs aimed at both sales representatives and customers. To provide an effective Return On Investment, travel incentives must meet sales objectives more effectively than other techniques. Launch, communication and program management play an important part in ensuring the success of a travel incentive program.

Travel incentives are considered better than cash and other discount incentives.  Vacation is perceived to be of very high value.  A recent study has identified the following intangible benefits of travel incentives

• drive desired behaviours

• improve retention

• provide a positive organizational culture

• provide networking opportunities

• build motivation

• provide employee recognition.

Advantages: sales incentive programs, when properly designed and implemented, will motivate more than just your top performing sales people to increase results and in the end will result in better profits.

Disadvantages: Company has greater cost because of awards. People might feel pressure (and not know of contest) so they might be more likely to regret purchase; there might be more returns.

Advantages of Sales Incentives

Intra-organizational contests are commonly utilized to create healthy competition among employees. When designed fairly and properly implemented, these sales incentive programs can really produce results which are much appreciated in a waning economy such as what we are experiencing currently.

According to the 80-20 rule, also known as the Pareto Principle, twenty percent of sales people make eighty percent of a given company's sales and profits. In other words, if you can motivate the next 20% of your workforce to do better the overall results can be exponential. If you plan out attainable goals to target your top, middle, average and under performers, then each group will be motivated to reach their own set goal level. For example, a sales competition could target top performers by planning objectives that would take maximum effort. In order to not exclude other workers, however, more attainable goals must be introduced for each group/level of performers.

As demonstrated, sales incentive programs, when properly designed and implemented, will motivate more than just your top performing sales people to increase results and in the end will result in better profits.

Disadvantages of Sales Incentives

Company has greater cost because of awards. Some of the increased sales aren't increases just salesman convincing people to buy something earlier than planned. People might feel pressure (and not know of contest) so they might be more likely to regret purchase; there might be more returns.