Sales Performance Management Best Practices Blog

How do you properly 'incentivize' sales reps with sales commissions?

Posted by Jerry Hegarty on Wed, Nov 5, 2014 @ 13:11 PM

"People will do what they get paid to do" Its a basic tenant of sales compensation design but one we need to continually revisit due to its enormous importance. 

Recently I happened upon a video where a panel of sales pro's got together on a panel discussion and one of the more fundamental questions in sales compensation was asked, "How do you incentivize (is that even a word??) sales reps with sales commissions."

The comments, and more importantly the anecdotes they use to highlight them, point to the power of a well designed sales incentive compensation plan. The panel included Andrew Quinn & Mark Roberge of Hubspot and Greg Coleman of Huffington Post. 

Mark Roberge shared how specific types of plan changes drove business results.


Plan Design Concept


During start-up, capture market share Pay reps up front based on Annual Contract Value Allowed us to capture a ton of market share up front
Overcome customer quality & churn issues Pay based on the lifetime value of customer base Churn rate skyrocketed down, it was awesome.
Contract Length Pay accelerators for longer term contracts Crazy long term contract lengths


  • No doubt about it, "Money drives behavior"
  • Plan design can be dependent on the companies stage of development.
  • Re-evaluate your plans frequently, at least every year.
  • Can be a ton of work, get everyone involved
  • When you nail it, it will have a huge impact on the company performance.
  • Keep the plan simple; should be able to fit on one slide, 6 bullets max. It has to be that simple.

Greg Coleman had some timely advice for new plans; test them thoroughly. Make sure you create a situation where successful reps who are crushing thier comp plan are actually helping the business crush its goals.

We encourage you to invest several minutes to view this instructive video. 

There are many ways NetCommissions can help turn Sales Performance into your Competitive Edge - click below to view a demonstration of NetCommissions.


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Topics: plan design, CFO/Finance Leader, Sales Compensation Professional, Human Resources, Sales Operations