When running an incentive program, it’s very easy to target the wrong audience. Maybe excitement gets the best of you—you target everyone because you want to motivate as many people as possible. Or maybe you target your top performers and most loyal customers because you already know they rise to the challenge. These aren’t necessarily the best strategies for operating a sustainable incentive program that earns consistent, long-term ROI. To run an incentive program the right way, you need specific objectives and goals. That means honing in on a specific, targeted audience. According to a 2015 Incentive Federation study, “The most important design consideration for sales program managers is ensuring that the program rewards the right people.
So how do you make sure you reward the right people? By answering the following questions:
1. What are your incentive program goals?
You’ll find that, as you specify the goals you want to accomplish, it becomes clearer who your incentive program participants should be. Let’s say, for example, you’re an industrial distribution company. You don’t have much interaction with your end-users because you sell your product through contractors or sales reps. So offer customer loyalty and incentive rewards for contractors. Channel incentives can give general contractors that extra motivation to train end-users on your products, participate in sales promotions, and choose you over their other suppliers.
The above logic can be applied to any section of your organization, no matter what kind it is. Identify your pain points and the people who most directly impact those pain points.
2. What’s your incentive program audience like?
Once you know who you want your incentive program participants to be, don’t be afraid to get into their heads to find out what they’re like. Take a look at them in their natural environment on Facebook. See which sports teams they follow on Twitter. Look at your incentive program and its goals from their perspectives. Ask yourself things like:
- Do their goals align with your goals?
- What would make them perk up and pay attention to your rewards?
- What kind of value proposition would they find absolutely irresistible?
You know you’ve identified the right audience when you know who will get the most meaning and value out of your program. For example, maybe you head up a young, Millennial salesforce who, according to Harris study published on Forbes, would much rather have an experience than physical rewards. Maybe this young salesforce was so motivated by the Ireland incentive trip you offered them that they blew through the year-end goal of increasing sales by 25%.
Knowing your audience is the key to delivering any motivational message, and incentive programs are basically one big motivational message.
3. Which performers are getting incentive rewards?
The 20/60/20 rule, touted by business advisor Ray Silverstein, says that most workforces can be divided up like so:
- 20% are strong performers
- 60% are average performers
- 20% are weak performers
Many businesses make the mistake of targeting only strong performers in their incentive programs. They know their star salespeople will always smash any goal put in front of them and that certain loyal customers will always be glad to try out a new, improved product.
But think about it this way: your top 20% will always be your top 20%. Wouldn’t you rather pull those 60% average performers up closer to the top 20%? When you target the middle majority of your salesforce or customer base, it can have a massive effect on your business. Not only do the middle performers themselves break out of the status quo, their improvement turns the heat on the top performers, who kick things into high gear to stay ahead. And peer pressure—which is an effective motivator for weak performers—inspires stragglers to keep up with the new standard.
4. Which type of incentive rewards are you offering?
The type of reward you offer should match the type of motivation you want to achieve. While one type of reward may be incredibly motivating to some, the same reward could fail to impress a different audience. Here’s a breakdown of the three reward types and how they should influence your audience selection:
Online reward programs are based on online points that can be redeemed for merchandise in a reward catalog. Online rewards points are accumulative, meaning participants save them up over time to exchange them for patio furniture, an HDTV, a FitBit, a toaster—whatever makes them happy. The long-term nature of points based rewards makes them suited to middle-60% salespeople, as well as channel partners and customers, ie. people you want to motivate and work with for a long time to come. Your inside sales team makes a great participant base for online rewards programs because you can add on features like online recognition and gamification, which add even more types of sales motivation to your program.
When you want to reward an international sales channel partner or customer base, debit and gift card rewards are the way to go. With online rewards merchandise, you run into issues of overseas shipping costs, customs and delays. But you can email a VISA debit card e-code to your international incentive program audience, then they can spend their rewards however they want in local online stores. Another audience well-suited to card rewards are salespeople participating in short-term sales promotions. They get their rewards quickly, easily and spend them right away. Consider the thriftiness and needs of your potential participant base, too, when deciding who your card rewards program audience should be. Newlyweds or those with families and children may be highly motivated by debit card rewards and the free reign to spend them however they need to. Economic trends reflect that Americans are spending less and saving more, so keep that in mind when determining the right audience for your rewards program.
If you want to offer travel rewards or group travel, your audience should be your top sales performers or distributors. Incentive travel is an opportunity to offer a once-in-a-lifetime experience, so it’s best to focus on the MVP performers you want to retain for a long time to come and the channel partners whose customer loyalty matters most to your business. If you have a younger participant base of Millennials, they’ll be especially motivated by travel incentive rewards. According to the Harris study mentioned above, “More than three in four millennials (78%) would choose to spend money on an experience or event over buying something desirable.”
Choosing your incentive program audience by reward type
Debit and Gift Card Rewards
Travel Incentive Rewards
When you create an incentive program that target its audience well, it has more clarity, value and significance to that audience. The more specific you can be, the more triggers you set off in your participants’ brains, telling them, “Hey, you! Yeah, you! This program is for you. You’re the one who can earn these rewards and benefit the most from them.” Be precise in selecting the perfect audience for your incentive program—the payoff will be a well-timed and well-placed slam-dunk of an ROI.