Motivating Using Sales Contests

It's April and if you haven't sponsored a sales contest yet this year, you are missing a real opportunity to focus your sales staff and have some fun at the same time.

Sales Contests vs. Commissions or Bonuses 

Salespeople expect to be paid commissions or bonuses if they achieve quota. It comes with the territory and is one of the attractions of the profession. Cash can be almost an intangible. Sales contests, especially those that offer tangible rewards, help a salesperson stretch and reach for a goal that they might have thought unattainable. 

Examples of great tangible prizes include gift certificates to favorite:

  • Stores
  • Restaurants
  • Amusement Parks

They could also include tickets to:

  • Sporting Events
  • Concerts
  • Museums
  • Movies

Other ideas can include a dish filled with the winner's favorite candy, a trophy that they get to keep until the next contest, or a coveted parking space. 

All of the above work for salespeople no matter their lifestyle. Offer several choices because the crucial element here is to let them decide which of these things they might like.

Dollars vs. Progress 

Salespeople often put in a great deal of hard work with a particular prospect before they ever get a chance to make the sale. Sometimes convincing a potential client to meet with them or have a discussion over the phone is a true achievement that many salespeople feel goes unrecognized. The sales contest does not always have to be about closed sales. Mix it up a little bit. An example of a non-revenue focused contest might be to offer a prize for a 10% increase in a month in the number of:

  • Product Demonstrations
  • Webinars
  • Prospecting Calls
  • Face-to-face Meetings

Top Producers vs. Everyone Else 

Sometimes well-meaning Presidents or Sales Managers create contests that only a handful of superstars can win. Once the rest of the staff catches on to this, they ignore the contest and continue with their daily work. Make certain that any contest you create encourages everyone on the sales staff to improve their own performance. 

Sales contests like these should be held at least once a quarter, be tailored to the individual participants, have a relatively low dollar value ($150 or less), have clear rules, and be brief (3 months maximum). A motivated sales staff that feels recognized for the tough job they have makes the creation of these contests well worth the effort.

Though my clients come from many different industries, the challenges they face are similar. In "Sales Management Tips," I regularly answer questions that have been posed to me by my clients. I hope the answers will help you to solve some of the sales dilemmas you face in your own sales organizations. If you would like to ask a question, please contact me. The identity and affiliation of those submitting questions will be kept confidential.

The Whys and Hows of Sales Contests

If you haven't already done so, it's time to create a sales contest for your sales staff. The novelty of the new 2006 compensation plan has worn off and your sales representatives are in the "grind" of the year. They need a contest to remind them of their larger goals and keep them motivated. I will address, one by one, the questions my clients typically ask me about the creation and administration of sales contests.

Why do I have to create contests throughout the year?

Before a single dollar of business is closed, sales representatives must deal with tough gatekeepers, disinterested prospects, difficult objections, cancelled meetings, influencers who claim they are decision makers, presentations that go awry, and stalled decisions. Salespeople need their spirits bolstered all during the year to help them deal with these situations, and contests are a motivational and inexpensive way to do just that. Salespeople are also competitive by nature, and by constantly challenging them you will keep their competitive drive alive.

Does a contest always have to reward sales revenue?

Absolutely not. Many, many steps precede a closed sale and they are all critically important. Sales representatives have to research accounts, make prospecting calls, go on appointments, and give presentations. Sponsor a contest that involves successfully completing a certain number of these pre-sale activities during a specified period of time. For example, if the average sales representative makes 4 presentations a month, offer an incentive if they schedule and complete a fifth in a single month or 14 in a calendar quarter.

Why should I have sales contests in my company when my superstar always wins?

Sales contests are not compensation plans and, therefore, can be tailored to the individual. If your superstar typically schedules 10 meetings a month with potential new clients and your other sales representatives schedule only 5, create an incentive around each one of them beating their personal average. The sales representative who goes on 5 meetings a month should be given a goal of 6 and your superstar’s goal should be set at 11 or 12.

Should the reward for winning a contest be additional cash?

No, for two reasons. First, very few people have the self-discipline to hold the cash aside and spend it on something for themselves. Secondly, cash typically gets spent on the everyday mundane things such as the dry cleaning or allowance for the kids. It is better to give out gift certificates to favorite restaurants, movie theaters, or book stores. When they redeem their gift certificates, it reminds them of their accomplishments and makes them feel appreciated by their employer.

Should I hand out the rewards at a staff meeting or in person?

Wait and see. Depending on the contest rules, everyone may not earn their reward at the same pace or even in the same month. It could be more motivating to hand them out individually. Regardless, make it a special event. Present it to them in a fancy box or envelope, include a thank you note, shake their hand, and thank them for their efforts.

Yes, it is extra work to create and administer periodic sales contests. There are payoffs though. If a salesperson typically goes on 4 appointments a month and the contest motivates them to speak to enough people to schedule a fifth, they now see that they are capable of achieving this number on a regular basis. Twelve more meetings a year will result in more presentations which will result in more sales. Discuss this with them. Run the numbers and look at the extra revenue potential. This will result in a more highly compensated sales representative – and they are always more motivated.

Boosting Summer Sales

A client asks, “How do I motivate my staff during the slower summer season?"

Some sales managers and sales representatives regard low sales production during the summer as unavoidable. Others see it as a more challenging, but not impossible, time of the year to make sales. Those who fare well during the summer months do so by having a plan in place long before the hot weather arrives.

Do Your Homework

To create an effective summer sales plan for your staff, do a little homework first. Ask yourself the following:

  • "What were the average monthly sales for June, July and August of last year?"
  • "Of those three months, which had the lowest sales?"
  • "How do sales during those months compare with average monthly sales during the year?"
  • "Which customers bought during the summer?"
  • "What did they typically buy?"
  • "Which customers did not buy?"
  • "Which products/services did not sell well during that time period?"

Set Goals and Share Your Findings

If your research tells you that sales in the summer are indeed significantly below the monthly average for the rest of the year, ask yourself what an acceptable level might be. Depending on what you find out about customer’s buying habits during this season, think about setting goals to increase sales for certain products and services as well. Whatever your research tells you, be sure and share this valuable information with your salespeople. They may not always know exactly why their sales are off during this time period and some of your findings could really help them.

Reward Extra Effort

Once you have determined what the increased sales goals for the summer will be, create a contest that rewards the salespeople for their extra efforts. Remember that not all rewards need to be monetary. With New England’s short summer season, your staff might value a little extra time off or some flexibility in their schedule. Find out what would motivate them and try your best to design a reward around it.

Don’t forget to find out when your sales staff is planning to take their vacations and post that information on a master calendar. Encourage them to find out when their customers will be taking vacations as well. That way they can more effectively manage the sales process during the summer months.

Start planning for summer now. It will pay off big dividends.