Sales is the most important factor. Which determines the success or failure of any enterprise. There is sales - that means the enterprise is successful. No sales means, alas, the market does not need your goods or services. Or does he need it? Maybe the sales department is not structured correctly, or the wrong people work in it?
As you know, the basis of any good result is strong motivation. The company's sales department is no exception. The effectiveness of their work depends on what incentives motivate your salespeople to work. And here the leaders have a difference of opinion.
Some believe that money is the most powerful incentive for an employee to work effectively. Others prefer to motivate employees only non-materially. It seems that both approaches are extremes, and the truth is always in the middle. In fact, every person always has some goals. Someone can implement them with the help of their work. If a person has a small, stable salary, then this may well be a good means of achieving one’s own goals. But there are other factors besides money that can keep you interested in a job.
So, what should be the motivation scheme for salespeople in the sales department to encourage them to work effectively?
The most understandable and practical motivation scheme was built by the American scientist and philosopher L. Ron Hubbard. He identified four types of motivation, with each type occupying a higher or lower level in relation to the others: 1) MONEY - this is the lowest level, 2) PERSONAL BENEFIT - a slightly higher level, 3) PERSONAL CONFIDENCE - an even more advanced level, 4 ) DEBT is the highest level of motivation. Now let's describe each type in more detail.
Money
Why is MONEY, as a type of motivation, at the lowest level? After all, it would seem that everything is simple: pay an employee more - and he will work better. What else can you come up with... But the fact is that if an employee is only interested in money, he will easily leave his company and move to another as soon as they promise him more money. It is very easy to lure such an employee to another company; you cannot rely on him. Well, if the company is going through difficult times, then he will run away at the first opportunity. This is the main, but far from the only disadvantage of motivation with money.
If we talk specifically about the sales department, then a salesperson motivated by money is unlikely to stand on ceremony with clients - after all, he needs to earn money at any cost. The customer will receive less attention but feel more pressure from the salesperson. As a result, he will certainly go to competitors, who will provide him with quality service.
Surely you have heard the following statement: “For such a salary, I do enough! If I were paid more, then I would work more." This means that an employee with motivation based on money wants to receive first, and only then give something. First you pay him, and only then he will move.
You don’t need such a seller, because he is of no use. Companies need sellers who create benefits, first of all, for customers, for their company, and for this they receive benefits from them - in the form of cooperation, loyalty and money.
Personal gain
Motivation based on personal gain arises when for a person, in addition to money, some other benefits that he receives from the company are important. This can be the close location of the office to the house, or a prestigious position, or all sorts of bonuses that are enjoyed by employees of a company. For example, a company provides an employee with housing while he works there or pays for gasoline for his car.
There is nothing wrong with a person taking into account his own benefits from working in a company. But if he is fixated only on personal gain, then he will not strain himself once again. Such a salesperson would rather simply wait for the client to call him than to methodically lead this client - calling him, convincing him, giving him a presentation, dealing with objections, etc. Again, this begs the rhetorical question - is such a thing necessary? company salesperson?
Personal conviction
A salesperson with motivation based on personal conviction already provides value to the company. Why? The fact is that for such a person, the most important thing is what he can give to the company, and only then he thinks about personal gain. Such people love the process of work itself - setting goals and achieving them, coping with the tasks received. Psychologically, they are ready to endure difficulties and difficult times together with their company.
For a seller with such motivation, it will be important how valuable the product he is selling is, what policies the company adheres to, what kind of word of mouth it creates about itself, how satisfied customers are with what they receive from the company. All this is valuable to him, one might say, a priority. He may be offered a higher-paying job with better conditions for him personally, but at the same time in a company that does not have a completely honest policy with its partners or clients. In this case, a seller motivated by personal conviction is more likely to refuse than to accept the offer.
Moreover, this seller will be more willing to support the group, that is, his team. Because he is confident in his abilities and in the company he works for. He likes to work, he is proud to work in this company, he wants to contribute to the common cause, to produce.
Duty
Duty-based motivation occurs when a person feels personally responsible for the performance of his company. He endures difficult times and makes a great contribution to the success of the common cause. As a rule, such motivation is inherent in the owner or director of the company. Especially at the initial stage of business, when you have to work on sheer enthusiasm. It is for this reason that such people stay at work until late and do a lot of work that can be assigned to their subordinates.
It is unlikely that your competitors will be able to lure such an employee from the company. Most likely, he will not even consider such proposals.
Now that all types of motivation have been considered, a reasonable question arises: How to properly motivate those salespeople who already work for you to work? How to stimulate sales?
In general, initially all the blame for the fact that salespeople have low motivation, they think exclusively in terms of money, lies with the manager himself. After all, it is the manager who creates various payment schemes depending on sales volumes, prize bonuses, etc. Moreover, if you have developed the practice of rewarding only with money, then, for sure, your employees will still remain dissatisfied, since there is always little money. The awarded employee believes that he deserves more. What should I do?
The way out is to stop rewarding only with money and use a system of non-material motivation for staff. You can introduce the practice of awarding prizes at the end of the month with a variety of prizes - from a letter of gratitude to a trip to a restaurant or even a vacation trip. The prize doesn't have to be expensive. The main thing is to emphasize to everyone the merits of the sales department employee and his invaluable contribution to the company. What an employee needs is recognition. If he feels his value in the company, his authority, then this is most important to him.
In addition, awarding prizes introduces a spirit of competition between sellers and encourages them to make more sales. And such energetic activity, in turn, brings a sense of satisfaction to the employees themselves.
Accordingly, in order to increase the motivation of sellers, it is necessary to organize a high level of sales so that they do not even have time for stupid conversations, meaningless activities that are not related to work. Help you take more responsibility for the company, for your clients, for your colleagues. At the same time, reward results and maintain the spirit of the game.
Find and support highly motivated people who will help you reach a new level or strengthen your existing positions.
What questions will you find answers to in this article:
- How Alphabet stores motivate staff using ratings
- Adrenaline instead of money: the experience of the Enter store chain
- For what achievements can a seller of the youth clothing store “Provocation” become a director?
According to a study by HeadHunter, in Moscow a retail seller can earn about 51 thousand rubles. per month, in Omsk - no more than 22 thousand rubles; in other million-plus cities in Russia, the income of sellers is between these indicators.
The motivation system of a retail store salesperson is most often based on gaming techniques. According to Anchor Business Solutions, a system of competitions between stores, departments and employees is widespread in retail. The key parameter here is sales volume. In some cases, employees receive an additional bonus or the company rewards them with a trip to a bar, bowling alley or billiard room. Among retailers selling sporting goods, corporate competitions in football, running, and swimming with the participation of teams formed from store or department employees are common. This year, some companies awarded the winners of such competitions with a trip to the Olympics in London.
From this article you will learn what other measures encourage retailers to work with better results (see also: Daily bonuses significantly increase sales).
Daily bonuses significantly increase sales
Complex motivation systems with numerous KPIs are not always suitable for personnel of retail companies. After a while, sellers no longer understand how much they will receive at the end of the month, and this discourages them. The effect is provided by simple shares with quick rewards.
For example, the Obuv Rossii chain of stores held the “Super Result” campaign several times. Its essence is that even if the sales plan is slightly exceeded, all store employees receive a bonus at the end of the day (in winter they paid 200 rubles - not much, but the effect was noticeable). When the promotion first started, some stores were open until 10 pm - they tried to reach the target amount. There were also funny incidents. One of the stores was just a little short of being overfull. In the evening, a customer came and chose shoes, but she did not have the required amount with her. She says: “I’ll come by tomorrow.” No, the sellers walked her home, she took the money, bought shoes, and then they walked her back. The plan was exceeded, bonuses were immediately received. Such service cannot be achieved by any training or instructions. But this technique also has a disadvantage: from the point of view of accounting, it is difficult to make daily payments; in addition, after a while the staff gets used to it and it is necessary to come up with new promotions.
Practitioner experience: Yulia Lipatova- Director of the retail chain of the shoe company “Alfavit”, Zheleznodorozhny (Moscow region)
Online ratings force sellers to perform better
Our salespeople can earn a monthly bonus equal to 2.5 times their salary. It consists of three parts: monetary incentives for the best employees, a bonus for personal sales results and a bonus for store achievements. I'll tell you more about them.
Award for a high personal rating of an employee. We decided to automate the assessment of how efficiently staff works. By 2004, the IT department installed computers with a scanner in the sales areas to search the warehouse for the required shoe sizes using a barcode. Then we thought that employees, even those working in different stores, could compete with each other, monitoring the results in real time. In 2007, we implemented this idea with the help of a corporate Internet page, on which the rating of the best sellers of the entire network is updated online. No investments were required other than the salaries of full-time 1C and web programmers.
Based on the results of each day, we select the 17 best sellers in our network, who receive a bonus in the amount of a certain percentage of the cost of the goods they sell. This percentage varies depending on seasonality and the cost of the pair sold. In winter, the product is more expensive - the percentage is lower, in the summer it is cheaper - the percentage is higher. On average, the bonus is 0.5% of an employee’s personal income per day, and at the end of the month - up to half of his salary (see also: Criteria for ranking the best sellers).
Bonus for selling a certain product (personal achievements). We have long understood that the effectiveness of marketing activities depends on how the seller shows himself: whether he tells the buyer about special promotions, whether he does it with enthusiasm or with coolness. To set it up for the sale of priority products (for example, products of a certain group, brand or product that is time to sell out), we assigned a bonus - a fixed amount for each pair of such shoes sold (depending on the group of products, this amount ranges from 5 to 15 rubles. ). There is also a threshold: as a rule, the bonus is awarded only if at least 100 pairs of priority shoes are sold. These fixed bonuses are automatically added to the salesperson's total monthly bonus and can double the salary.
Criteria for ranking the best sellers
Only those salespeople who are at work participate in the rating of the current day (the time and attendance program automatically records when they showed up at work). Let's say that in the first half of the day there was a large influx of buyers, and two sellers (X and Y) worked with the same intensity, selling 15 pairs each. Accordingly, by 16:00 they had an equal efficiency ratio and occupied one place in the ranking. However, salesman X had to go home early, and salesman Y worked until the end of the day. If from that moment no pairs were bought from him, then sales of X and Y remained at the same level. But salesman Y continued to serve customers, and his working day turned out to be four hours longer. It would be unfair to split the bonus equally between X and Y. In this case, the more hours the salesperson worked, the higher his efficiency ratio. This rule forces employees not to be late and, if possible, not to take time off. If the seller wants to leave earlier, then he tries to work harder than others.
Another example. Let’s imagine that an employee came to work on time (that is, was automatically included in the rating), but two hours later he asked to go home for health reasons. Nevertheless, he managed to sell several pairs. So that his results in the evening are not compared with the results of those who worked longer, and he would not become unfairly worse, the system automatically excludes him from the rating if he worked less than half the working day.
Practitioner experience: Sergey Rumyantsev –
General Director and co-owner of the Enter store chain, Moscow
For our sellers, adventure is an incentive as good as money
Our company has come up with a corporate motivational game “OlympiaDA!” Her goal is to captivate employees so that they share her ideas with the company and work becomes for them not just another place of work, but something more interesting. The game elements of this system allow you not only to add drive to routine tasks, but also to recognize the small feats of employees. For example, there was an urgent need to make a promotional video, and a staff photographer spent personal time on it - it makes no sense to pay a monetary reward for this, and not noticing it is wrong. The system is based on the ratings of all employees, which are displayed in their personal profiles on the internal corporate portal “YakomanDA”.
General store consultants compete with each other in several categories.
1. “Unit KPI” is a team indicator of store efficiency.
2. “Fifth Element” criterion – this category includes indicators that are important for the company right now. Today, for example, this is the growth of trade turnover, but in the next quarter other tasks may become priorities.
3. Innovation: we collect interesting proposals from all employees, and if the idea is adopted, then its author receives points in the OlympiaDA! system.
4. Involvement in corporate life: this includes a number of categories with a small specific weight, guided by which we determine how much a person is “ours” or whether he “just goes to work.” For example, does an employee take part in corporate events or discuss company life on the corporate portal.
At the end of the quarter, the leaders with the maximum points are selected. Last time we marked 30 employees, but as the number of employees grows, the quota will increase. We deliberately refused to give away prizes like a phone, a TV, or an iPad—we give experiences because they cannot be lost, broken, or exchanged. The winning group goes to some exotic place where everyone participates, for example, in a jeep race, horseback riding on a mountain slope, rafting, or fly on a small plane to some island. All this is accompanied by an interesting game dedicated to corporate values. The winners return to work after three days of adventure, tired but happy, with the thought “how good it is that it’s finally over, but how cool it was with us.”
I would like to note that introducing game elements (gamification) into the work process is a new trend in business. I am sure that in five years, gamification specialists will be in no less demand than social media managers are today. What kind of profession is this? The gamifier turns routine work processes into a game. In addition, his responsibilities may include adding elements of play to relationships with clients. There are still very few such specialists, and their salaries can reach 80–120 thousand rubles. per month.
Practitioner experience: Hasmik Gevorgyan- General Director and co-owner of the Provokatsiya chain of stores, Moscow
We motivate “sales people” to actively sell!
Oh, it’s not an easy job to motivate people who are accustomed to passive work with clients to engage in active sales. But for many companies it has become a matter of survival.
“Sales have dropped significantly, and employees are sitting and waiting for clients to line up again,” complained the head of one of the famous architectural bureaus. The fact that specialists capable and, most importantly, willing to engage in active sales at all times has been the dream of any manager is an indisputable fact. However, very often these dreams remained unfulfilled. “Getting people who have never actively looked for clients to sell is quite difficult. Especially if they are not used to this format of work and they lack motivation to achieve results,” noted Elena Proskura, a practicing HR consultant, leading teacher at Moscow Business School.
The reasons for this mysterious phenomenon are simple. Anyone who first initiates contact with an uninterested person exposes himself to the risk of receiving a negative reaction from a “potential buyer” who wants only one thing: to quickly get rid of the intrusive interlocutor. For people who are sensitive to other people's opinions, this can be a very painful blow to their self-esteem. Among other psychological barriers that an ordinary salesperson has to overcome, Victor Krivizyuk, business coach in the “Sales and Negotiations” direction, director of the RTC training center (staff - 20 people), calls: “Fear of a closed door, fear of taking initiative, fear of communicating with a stranger, treating active selling as unprestigious.”
Therefore, a good sales specialist must combine essentially incompatible qualities: on the one hand, be able to understand and feel the client (which is impossible without empathy, the need for social contacts and social approval), on the other hand, not react to a negative assessment of oneself and of its activities. But in business it is not customary to become sentimental and pay much attention to the subtle emotional experiences of employees. Most often, managers use the “carrot and stick” method.
In cramped conditions. No offense?
To force sales people to leave their cozy office, the management of one English company developed a special method of organizing space for the sales department - the “uncomfortable room”. Not a single manager of this company had his own permanent workplace, and the number of employees was one and a half times greater than the number of jobs in this department. And therefore managers were forced to meet more with clients. In this simple way, according to company representatives, they managed to achieve a 25% increase in the number of new clients.
However, top managers are often less creative. “Everyone measures what they consider important: visits over a period, the number of active clients, new clients, independently attracted clients, etc.,” said Victor Krivizyuk. However, according to Sergei Slipchenko, head of the sales department of Forcrust LLC (distribution and sale of automotive paints, oils and enamels, staff - 85 people), such sales plans are more likely to hinder than help a true professional: “Over time, everyone Sales develops its own style of work. Some prefer to regularly “visit” clients, while others, sitting at the computer, “bring” customers from various forums and carry out the plan. Therefore, I believe that there should be a single criterion for the effectiveness of sales - sales volume." Olga Ostapenko, an organizational psychologist, also notes that this approach is the most acceptable from a psychological point of view: “Due to the crisis, the working conditions of sales people are becoming less comfortable. The fixed part of the salary is reduced to a minimum, management control is strengthened, corporate mobile communications are limited, and other restrictions are introduced. At the same time, finding potential clients has become much more difficult. Therefore, any repressive measures only contribute to escalating the situation and speedy emotional burnout of sales representatives, who are already more susceptible to this “illness” than others.
One way to avoid the need to force reluctant salespeople into the field is to train newcomers who have not yet been touched by the pernicious, enervating influence of passive sales. “I am now faced with a situation where experienced active sellers no longer have the desire to engage in sales, and passive ones simply do not want or cannot quickly adapt to new conditions. Therefore, it is easier to rely on inexperienced specialists by creating a training and mentoring program for them. Motivation to achieve results, as my search experience has shown, is still higher among young people,” said Elena Proskura. However, in those areas where sales are complex in nature or involve the sale of high-tech products and solutions, this path is impossible: here the sales specialist must also be a professional in his industry.
To convert experienced sellers engaged in passive sales to active search, Elena Proskura advises, firstly, to change the material motivation system, secondly, to introduce a plan for active sales and, thirdly, to train sellers in the skills of actively attracting clients.
Setting up for a feat
The importance of the quality of sales work, according to Sergei Slipchenko, during a crisis increases many times over. Consequently, “we must strive to work smarter, i.e., concentrate on new tasks and spend our energy on more profitable projects,” Mr. Slipchenko added. And for this, employees need to be trained and inspired to achieve their work. “To inspire their employees, many managers use the concept of an “external enemy”, competitors who must be “defeated” at all costs. This idea is still relevant now, because the financial crisis is too vague “the focus of evil,” says Olga Ostapenko.
Special trainings are designed to make the work of salespeople more effective. However, not all standard programs can be truly useful. “If you need to move from a passive to an active sales style, pay attention to the presence of the following blocks in the program: searching for a client, collecting information about the client, establishing contact, working with objections, completing the sale. Skills such as identifying needs, making presentations and after-sales service are also well developed during passive sales,” advises Victor Krivizyuk.
However, according to Mr. Krivizyuk, it is also necessary to take into account the psychological characteristics of the employee: “If in any case you need to make the “salesman” style active, then there are actually two tasks here: to change the person or to teach him. Teaching is much more realistic than changing views. And therefore, if there is no inclination towards an active sales style, the employee will suffer for as long as the situation allows.”
To avoid this, Victor Krivizyuk advises reviewing the sales organization scheme in the company: “There is a principle for building sales when not all sales people look for clients on their own. The principle is based on the opinion that everyone has their own strengths, and if the “order hunter” is better at attracting new customers, then making a client a permanent one is a task for the sales support department.”
However, all our experts agreed that the main thing is to create the necessary conditions and provide maximum support from the company to its main earners. And only in this case will the sales department employees go “to the fields” without the feeling that it is the reborn Pol Pot making them forget everything they know and driving them to wave a hoe under the banner of a new agrarian revolution.
Natalia Naumenko
The introduction of a percentage of sales into the sales motivation system is considered one of the most optimal ways to influence an increase in sales volumes. But there are also pitfalls here. The first situation that the manager faces: a percentage of sales was introduced, but the sellers did not sell more. Consequently, sales remained at the same level. The second situation: sales increase, but up to a certain volume. After which the sellers mentally say to themselves: “Well, we have already earned our salary, now we can rest.” And this is where the sales growth stops.
Why do such problems arise and how to make the sales motivation system really work? In order to understand this, you need to understand what the motivation of the seller generally depends on.
Two types of motivation
The desire with which a person engages in any activity always depends on two types of motivation: internal and external. Intrinsic motivation presupposes the presence of internal incentives for achievement: interest in work, pleasure from personal victories, etc. External motivation is determined by external incentives: bonuses, bonuses, praise, punishment, etc. How a salesperson works depends on the combination of these two types of motivations.
If the seller has both internal and external motivation.
Such sellers show truly outstanding results. In this case, sellers have an interest in their work, a certain passion. They like to communicate with clients, they like to lead them to purchase, they like to sell. And they sell. These achievements are supported externally by awards, bonuses, thanks, etc. Internal motivation is further enhanced. The desire for achievement increases. And as a result, sales volume increases even more.
If the seller has internal motivation, but no external motivation.
In this case, the seller shows good results at first. But without receiving external reinforcement, internal motivation gradually decreases. He begins to feel that his work is useless for the company. There is a desire to change jobs for more profitable or more promising ones.
If the seller lacks internal motivation, but the campaign has well-developed incentives for sellers (external motivation).
The main problem with such sellers is that they focus too much on money, and the clients themselves and the sales process fall out of their focus. In this regard, such sellers, as a rule, fall into two extremes. The first is that they begin to offer the client everything at the lowest prices and with the maximum number of additional services (“If only I bought it!”). Thus, minimizing the company's profit. Moreover, the saddest thing is that such a sales strategy does not at all guarantee that the client will buy. Moreover, often such a strategy only pushes the client away. The second extreme is that such sellers begin to look at the client as a money bag from which they need to extract as much money as possible. The client feels this and it also hinders the sale.
As a result, these salespeople begin with a flurry of customer acquisition activities. At the very beginning they fail. And almost immediately they lose motivation. And these are precisely the same sellers who are not motivated by a percentage of sales at all. Because they do not believe in the possibility of receiving it.
If the seller lacks both external and internal motivation, then everything is obvious. The seller is not at all interested in sales results, and he is simply sitting out his time. It is difficult to call such a seller a seller, because... he does not sell, but people buy from him. And the sales result of such an employee depends only on the strength of the client’s motivation to purchase from this particular company.
Therefore, if we want to get a truly successful salesperson, then he must have both external and internal motivation in his work. Let's figure out what we can do to ensure that only such sellers work in the company.
Ways to influence the motivation of sellers. Intrinsic motivation
As I noted above, a seller without internal motivation is not a seller and it is pointless to expect high results from him. There is a fairly widespread belief that this kind of motivation is more of a character trait than an acquired phenomenon. That is why competent selection is considered the main way to create internally motivated salespeople in a company. It is at this stage that people who are not at all interested in the sales process and achievements in them are eliminated.
But I do not agree with this position. In my opinion, this method of forming a sales team is only suitable if we initially recruit experienced salespeople. Those who are already familiar with selling and even know some sales techniques and technologies. If we take people with no experience in sales or with little experience, then it is pointless to look for people among them who “love to sell.” And this is due to two reasons:
Historically Negative Attitudes Toward Sales
Unfortunately, even during perestroika, the word seller, or in common parlance “tender,” had an exclusively negative character. In the book by E. Chichvarkin “E..genius. If out of 100 times you are sent 99..” there is a very interesting phrase: “At that time (perestroika times) it was a shame to buy low and sell high. Now, if you found out you could buy it somewhere cheaper and told everyone about it, that would be good. And resell..."
This is why many people go into sales, so to speak, “out of desperation,” because they don’t know other ways to make money. And such people have not yet awakened the “taste for selling.” They do not yet have an understanding of selling as one of the ways of self-realization.
Not understandingsellers on how they can affect sales
Many novice sellers, and not only beginners, have the firm belief that sales do not depend on them at all. And it depends on the advertisement, the point, the clients, the price of the product. And this belief has its reasons. Sales really do not depend on them, because... they just don't know how to influence it.
This also includes the fact that, starting to sell, and not knowing how to do it, they naturally cannot feel that “sense of victory” that is characteristic of experienced sellers. Those. the feeling that arises as a result of a completed transaction, and a transaction completed by the seller. It is this sense of personal success that is often the basis of intrinsic motivation.
Let me give you an example with a foreign language. If you study, learn a language, study for a month, a year. And as a result, you don’t see any progress in mastering it; you gradually lose motivation to study it. This is why so many people constantly take up learning a language, but cannot complete the process they have started.
If you find a good teacher, and he constantly draws your attention to your successes. For example, after a week he shows you that you can already speak simple phrases. After a month, you are calmly talking in a foreign language on general topics. In this case, you only begin to get more involved in learning the language.
It's the same with sellers. When they do not see their own achievements, the desire to make these achievements cannot even arise. And since there is no desire to achieve, there is no internal motivation.
All these features of perception of beginners or inexperienced, and often even experienced sellers can be changed. And the main tool for change in this case is training. With professional sales training, sellers not only gain new sales tools, but also an understanding of how they can influence the sales result. And also, new attitudes of the seller are formed, a new perception of selling, interest in the sales process, pride in their profession. And all this constitutes the very internal motivation of a successful seller.
Extrinsic motivation
As I already said, increasing the internal motivation of sellers in itself significantly increases sales. But such motivation, without external support, declines after a while. Therefore, it is very important that the company also has a well-organized system of external motivation. What does a well-organized system of external motivation mean? And how is it different from a poorly organized one?
To do this, let's first figure out what motivation is, as a way of influencing human behavior.
Motivation as a way to influence a person
The result of this motivation is always a certain action on the part of the motivated. How does the process of motivation occur?
The one who motivates sets a goal that is clear to the motivated. Gives an understanding of WHY for those who are motivated to achieve their goals. And then it controls the degree to which this goal is achieved, reinforcing actions that bring it closer to this goal and negatively reinforcing (with punishment) actions that move away from the goal.
Why motivation may NOT work:
1. The goal is not clear to the person we are motivating.
2. He doesn’t understand WHY to achieve it
3. He doesn't have the tools to achieve it.
4. His actions towards achieving the goal are not reinforced in any way, he does not understand whether his actions are correct and begins to behave based on his personal ideas
Transferring this to the system of motivation of sellers, it is clearly visible what the main mistakes are
Errors in the sales motivation system
The goal is not clear
This often arises in situations where managers only receive a percentage of sales. They are, in fact, given to understand: “sell as much as you want, just as much as you sell, you’ll get as much.” And of course, there are purposeful sellers who have endless growth in their blood. The majority either sets a goal that matches their aspirations, or begins to “play the lottery.” In the first case, this is a seller who, having sold “for his salary”, namely to a level of income that seems to him to be “good”, relaxes. In the second case, sellers begin to strive for the “big jackpot”. That is, they start working only with those companies and clients who can bring a lot of money at once. But such companies require too much time to attract. Moreover, if sellers are not very good at attracting such companies, then they end up “waiting for a miracle” - a big deal.
In this regard, the goal that is more understandable for the seller is the sales plan, i.e. determining the monthly, quarterly, annual volume (depending on the specifics of sales) that the seller must fulfill.
It is not clear WHY to achieve the goal
This kind of error is present in sales motivation systems, where a sales plan is set, but there are no bonuses for its implementation. And also where the reward for the result does not correspond to the efforts of the seller necessary to achieve this result. For example, if a seller is engaged in active sales and needs at least a month to find and attract one client. For example, this is due to the fact that the process of making a decision by a client to begin cooperation in such sales is very long. And the reward to the seller for finding a client is 240 rubles. Naturally, he has no incentive to attract new clients.
No achievement tools
The point here is that the seller must have an understanding of how he can achieve his goal. And this will include knowledge of sales technologies that allow influencing the client’s decision-making. Those. then due to which we can increase internal motivation. So is the presence in “his head” of a scheme for searching and attracting clients, i.e. how it can influence the increase in volumes. For example, if a salesperson does not understand that in order to attract 20 new clients, he needs to make a minimum of so many calls, hold a minimum of so many meetings, then this goal seems unattainable to him. And having made several calls and received the same number of refusals. He completely loses all motivation to work.
No reinforcement for necessary actions
This applies to companies in which the increase in personal sales volumes by the seller is not supported in any way. And this is either due to the absence of any connection at all between the seller’s income and his results. Or the presence of a flexible sales plan, which constantly increases while maintaining the bonus amount. Those. the seller, despite the constant personal increase in results, does not increase his income. On the contrary, in order to get them he has to spend more and more effort each time.
How to develop a working sales motivation system
I’ll say right away that we will be talking about a system of motivation for sellers, the main goal of which is to stimulate an increase in sales volumes. After all, a company may have completely different goals: increasing profits, increasing market share, etc. And the motivation system taking into account these goals will be completely different. But this is a topic for a separate article.
So, if we need to incentivize salespeople to increase sales, we need to answer the following questions:
1. How much should a salesperson sell per month, quarter, year in order for the company to achieve its strategic goals?
This is a very important point. Because One of the main mistakes is to plan based on how much sellers sold before. This policy does not imply any growth. And it is suitable for companies that have reached their “production ceiling” and for them an increase in volumes is not only undesirable, but even dangerous.
In addition, it is important to determine the sales plan based on the company's goals, because salespeople are tools for achieving the company's goals. And their behavior should be consistent with these goals, not determined by them. Otherwise, we have what is popularly called a “mess.”
2. How much effort must the seller expend in order to achieve this result?
The important thing here is to understand how hard the seller must work in order to achieve this goal. It is also important at this point to determine how the seller’s work should be organized: how many meetings he should make per day, how many times he should travel to one client, whether he is expected to travel to the regions, etc.
And here, as a rule, there is an understanding of the need for new sellers, or improvement of their work. And also, what should be the amount of remuneration for work of such intensity?
3. What additional resources can help the seller in his work?
To do this we define:
What training do sellers need?
What technical equipment is needed (phone, car, laptop, etc.)
What tools does he have to influence the sales result?
What additional tools can he have to influence volumes (advertising for clients, information and technical support). We are talking about sales to intermediaries.
Only after this can we create the motivation system itself. Which will include:
Sales plan.
Monthly, quarterly, annual
Changing the terms of remuneration depending on the implementation of the plan
Here the reward is determined in case of fulfillment of the plan, failure to fulfill it, or overfulfillment. It is important that over-fulfillment is also stimulated, because this will most likely be the result of the salesperson's intrinsic motivation. And she, as I said above, needs positive reinforcement
Action plan to achieve the desired result
Here it is important to determine how many calls and meetings the seller should make. What additional tools will he use to influence volume increases, etc. It is important that this plan is agreed upon with the manager, or better yet, drawn up together with him. This will also include the necessary training.
To summarize this article, I want to emphasize that any working system differs from a non-working one in that in the second one some links are missing. This also applies to the motivation system. Often one of these “dropping out” blocks is the formation of an understanding among sellers of how he can achieve the desired results. That is why introducing a percentage of sales rarely directly leads to an increase in sales volumes. Only the inclusion of a sales plan, a plan to achieve the desired result and staff training in the motivation system can truly influence sales growth.
Personnel motivation is a way of managing employee behavior, influencing him with the help of material and moral incentives. Despite the fact that material motivation is primary (all other things being equal, when applying for a job, an employee will choose the vacancy where the salary is higher), for stable work and the absence of staff turnover, it is very important for the employer to take into account non-material motives of a person, such as:
- need for respect and self-affirmation
- favorable psychological climate in the team
- a work function that captivates a person and likes it in itself
- desire to feel independent and responsible for a certain area of work
- opportunity for career growth
- the desire to be in a certain environment (especially important for expensive stores where there is an opportunity to communicate with wealthy customers, or for stores that gather people who are passionate about something)
- prestige of the place of work.
Types of staff motivation
In addition to direct material motivation in the form of additional payments to the employee, there are intangible (which, however, requires certain costs from the employer) and moral motivation:
The store's expenses that go toward the material motivation of employees are called the wage fund. Like other types of expenses, these expenses must be normalized. It is considered normal for retail trade if payroll costs do not exceed 10% of revenue. The store needs to develop a wage and bonus policy and communicate its main provisions to employees.
We consider the most famous wage systems in a retail store in the table:
Material motivation system | Characteristic |
Fixed salary | Typically, such salaries are lower than what salespeople receive on average in the labor market in the region, taking into account the percentage of sales. Poorly stimulates employees, attracts random people who easily quit as soon as a better option comes along. |
Salary plus a percentage of sales for the entire store (or an equal bonus for everyone if the sales plan is met) | This option is possible in stores where the role of the seller in sales is minimized (for example, self-service stores, grocery stores, everyday goods) or it is difficult to identify the share of sales of a particular seller. In teams where sellers are of approximately the same level and are loyal to each other, this option can also be successful. |
Salary plus percentage of personal sales | This scheme is appropriate for sales that require consulting the buyer and active work of the seller. It is necessary to think over a system for recording the sales of each employee. |
Please note that with the “salary plus interest” system, the lower level of the fixed salary cannot be less than the established minimum wage (minimum wage, approved annually by the state). In percentage terms, the share of the fixed salary should be from 25% to 50% of all payments to the employee, otherwise the stimulating effect of the percentage of sales is reduced. If additional payment in the form of a bonus is simply tied to exceeding the plan, then the size of the bonus should be no less than 20% of the salary, otherwise it will not sufficiently motivate the staff.
The level of monthly sales, which the store defines as planned, is usually calculated based on the break-even point, that is, when the trade margin covers all the store’s expenses for the month, including the fixed salaries of salespeople. If you set a sales plan that is too high, practically unattainable for the store, then this will, on the contrary, demotivate sellers.
Features of the retail store team
Most retail stores (except chain stores) are distinguished by the fact that their teams of workers are small, and the employer’s opportunities for additional financial motivation are often limited. Such small groups live according to the laws of small group psychology, which is characterized by:
- the general goal of joint activities, which can be expressed in the form of certain indicators;
- a noticeable result of the actions of each member of the group, everything is visible;
- a significant amount of time spent together;
- close personal contacts with emotional overtones;
- the expressed status of each group member;
- unwritten moral rules and norms;
- group expectations, i.e. an opinion about the expected behavior of a particular group member, a kind of label for a person.
Any group has its own leader formed or initially appointed. For a small group, it is very important that the leader not only sets tasks, controls their implementation, demands that goals be achieved, but is also focused on improving the interpersonal relationships of team members and a favorable atmosphere in general.
Often store owners do not take into account these characteristics of small groups and demand that the administrator or store manager achieve indicators at any cost, being overly harsh on the staff, especially ordinary sellers. The work of a salesperson is not easy in itself, and in an atmosphere of rejection, when the employee is not seen as a full-fledged person, the possibilities of moral motivation (at no cost to the employer) come to naught.
Ultimately, this approach turns against the employer himself. Turnover in retail trade is already quite high; a rate of 30% per year is considered normal (i.e., out of every ten employees, three quit). If employees leave the store due to a complete lack of moral incentives and the dismissive attitude of management, then this is a direct loss of profit for the owner. A new employee must be found, trained, and adapted, and this requires time and money.
Much more reasonable would be a policy of maintaining a favorable environment in the team, avoiding conflicts, forming a team and distributing positions taking into account the psychological characteristics of employees.
Motivation and psychological type of employee
The method of motivating an employee largely depends on his psychological type. One of the most popular psychotype analysis systems among personnel workers is the MBTI method; every year about 2 million people around the world undergo such analysis. The method is based on Jung’s personality typology and is based on the fact that there are four main criteria that guide human behavior:
- where attention is directed: extrovert or introvert;
- in what way a person perceives information better: specifics, fact, result or intuition;
- how he makes decisions: reason or emotions;
- lifestyle: clear planning or spontaneity.
The result is 16 psychological types, but four main types are chosen for express analysis:
Characteristic | Motivation |
|
Administrator (SJ) | This bureaucratic type fits perfectly into the “superior-subordinate” system, and is successful in both roles. Reliable, stable, predictable, follows traditions and defends them. Develops rules and instructions, tries to minimize costs and preserve the employer’s finances. Good managers at all levels. May be harsh in their communication as part of their role as a boss. They are fair to their subordinates and know how to motivate with carrots and sticks. |
|
Firefighter | Energetic, emotional, “stars” in the team. They work unevenly, they can achieve one-time great success, and then give up halfway through. They feel great in a crisis situation, are bursting with ideas, and take risks. As managers are unpredictable, they need the support of more stable and consistent employees. |
|
Intellectual (NT) | There are no authorities for this type, so it does not fit well into a hierarchical structure. Efficient, meticulous, persistent, constantly continues to study, prefers independent work, for which he bears full responsibility. The biggest insult for him is doubt about his professional competence. It’s difficult to get along in a team, because... considers other employees to be insufficiently intellectually developed or approaches them with his own standards, demanding that work be performed at the high level characteristic of him. He does not like conflicts in the team, he withdraws and goes into work, which is why other employees consider him arrogant. |
|
Mastermind (NF) | The main value is relationships in a team, avoiding conflicts, striving for reconciliation and respecting the interests of others. They know how to create a positive environment in a team. They do not like to take risks; they prefer to work in a team as directed by their superiors. They are not always effective as a boss, because... do not know how to insist that subordinates fulfill their duties. However, they are quite capable of leading work in a team of like-minded people, where strict control is not required. |
|
The MBTI analysis is based on a questionnaire of 93 questions; you can find it yourself or contact a specialized recruitment agency. In any case, it is worth knowing that not all people are equally capable of the work assigned to them, so when distributing work functions, their strengths and weaknesses must be taken into account.
For example, if you assign the Fireman to keep track of inventory on an ongoing basis, and send the Mastermind to tough negotiations with suppliers, then nothing good will come of it. It’s a completely different matter if everyone is in their own place, using their strengths:
- Administrator - store director;
- Intellectual - accountant, merchandiser or analyst of store performance results;
- The inspirer is a sales consultant who knows how to take into account the wishes of the buyer, striving to make him satisfied and loyal to the store;
- A fireman is a buyer who knows how to find the best supplier.
- Think about what motivational methods you can apply in your store. Do not forget about moral motivation, which does not require serious expenses from the employer, but at the same time allows you to create a cohesive work team.
- It is preferable that the amount of additional amounts of money, bonuses, and compensation depend on the individual results of the employee’s activities, if working conditions make it possible to isolate a personal share of sales. Tying financial incentives to a store's collective performance doesn't work as well.
- The motivation system should be perceived by staff as fair, i.e. employees of the same category, when achieving similar results, should receive approximately equal amounts and compensation.
- The scheme for calculating additional payments and bonuses should be clear to an ordinary seller, so that he can imagine, without complex calculations and obscure coefficients, how much he will receive at the end of the month. As for the administrator, manager or director of the store, when calculating the amount of payment, not only sales volumes can be taken into account, but also such indicators as reducing store losses (theft, damage to goods, fines and sanctions of inspectors, violation of labor discipline by employees), compliance reporting discipline, etc.
- The results by which employees are evaluated must be objective (sales volumes, customer conversion, etc.) and depend little on the personal attitude of the manager towards the employee.
- More complex and responsible work should be rated higher, and the transition to another rung of the career ladder (salesperson-senior salesperson) must be accompanied by an increase in salary, at least by 5-10%.
- Fines of any kind do not motivate employees to work better; a system of bonuses for work without violations is more motivating. In addition, the Labor Code prohibits any deductions from wages for violations. As a disciplinary punishment, only a reprimand, reprimand or dismissal are permissible.
- When choosing job responsibilities and ways to motivate a particular employee, take into account his psychological characteristics.
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