Consumer Behaviour and Sales Management

UNIT-III

Group dynamics and consumer reference groups:

Group dynamics means how individuals form groups, and how one person purchasing influences the
other individual’s actions. Nowadays marketers use the concept of group dynamics or personal
influence often as this exceeds the power of the company’s promotional efforts. “A group may be
defined as two or more people who interact to accomplish either individual or mutual goals”.
This means that there can be an intimate group like two neighbors going out for shopping especially
grocery products and a more formal group like housing association members who are more concerned
about schools, parks, taxes, etc., in their vicinity. We can also include, that an individual consumer
looks to others for help in deciding which products or services to use.
Types of Groups:
Groups can be classified in a number of ways like by structure, by the regularity of contact, by size,
by the membership. Sometimes groups are differentiated in terms of size or complexity but it is very
difficult to state which group to be considered as large or small.
It is seen that in some groups a single member knows only a few of the group’s members personally
or is fully aware of roles or activities each member has to play whereas in small groups every member
knows each other personally and are also aware of the specific roles or activities in the group. For
example, each member of the college science club is likely to know others in the club and is also
aware of their duties and interests within the group.
A. Primary Group and Secondary Group:
If a person interacts on a regular basis with other individuals, then these individuals can be considered
a primary group. Interaction can be with members of the family, with the colleagues, with neighbors,
etc., this means whose opinions are valued by that person, on the other hand, if a person interacts only
occasionally with others, or whose opinions are not important, then this type of group is called
secondary.
Difference:
Primary and secondary groups can be distinguished on the basis of the perceived importance of the
group to the individual and the frequency with which the individual interacts with them.
Formal Group and Informal Group:
This is the second useful way to classify groups on the basis of their formal nature. If a group has a
highly defined structure, specific roles, and authority levels, and specific goals then this is called a
formal group. For example, in an organization – a list of all employees (defined structure), Managing
Director, Manager, Assistants, etc., (specific roles and authority levels), this shows a formal group.
Goals may be different for different organizations like to assist the homeless, working for the benefit
of old people or marketing goals-Increasing sales, promoting the product, etc. In these kinds of
groups, members have a vested interest towards a specific -goal, therefore, they are classified as a
formal group.:
On the other hand, if a group is more loosely defined, then it is an informal group. For example, four-
five girls who become friends in school and now meet only once a month. For the marketer, informal
social groups are more important because of the loosely defined structure a more conducive
environment is available for the exchange of information to the members.
B. Membership Group and Symbolic Group:
Membership Group is a group to which a person belongs or would qualify for membership. For
example, college alumni association, IMA, an association of doctors, tennis club, etc. Symbolic group
is a group in which an individual is not likely to receive membership even if he/ she acts as a member
by adopting that group’s values, behavior, and attitude. For example, for youngsters cricketers like
Sachin Tendulkar, Sourav Ganguly, etc. may constitute a symbolic group. They try to identify with
these players by imitating their behavior like the style or sometimes by purchasing a specific brand of
bat, gloves, dress, ball, etc.
Even after this, youngsters probably will never qualify for membership as a professional cricketer.
Nowadays marketers are using the celebrity for advertising their products so that people aspire to
become like them after owning and using those products. Studying these groups is very important to
the marketer as they exert the greatest potential influence on the consumption decisions of an
individual.
Reference groups are of two types −

 Primary Groups
 Secondary Groups
Primary Groups
Primary reference groups are basically the set of people whom you meet every day. They can be from
your family, your close friends, your roommates, etc.
These people from primary groups may have a direct and strong impact in your lives and your buying
decisions since they are very significant to you. Primary groups make you comfortable and give you a
feeling that they are with you when you are confused about a purchase. These people give you very
honest and clear advices as they are so close to you, due to which you could be more confident about
the purchase. Research shows that the bond between people leads people to be effectively social and
as satisfied consumers.
Secondary Groups
Secondary reference groups are usually formal and they speak less frequently. They might be
professionals, your collogues, your seniors at work or your acquaintance at club, etc.
In secondary reference groups the power to influence people is quite less as compared to primary
reference groups as people in these groups are not that comfortable in sharing their thoughts or views
on the purchase.
Let’s have a look at few more reference groups
Aspirational Group
Aspirational group is the one to which a person may want to become part of. They currently are not
part of that group but wish to become and get with that group. For doing the same, they try to dress,
talk, act and even think the way the members of that group do.
For example, people who like Madhuri Dixit wish to become like her and meet her and so start
purchasing and using all those products that she endorses.
Dissociative Group
The people in these groups are totally opposite to the people in the aspirational group. Here people
deny of becoming or getting connected to a particular group. They just hate being related to that
group.
For example, if people don’t like a particular community, they would never like being connected to
them. So they would try all the possible ways to avoid the way in which they dress, think or act.
Thus marketers need to understand the likes and dislikes of the consumers and also the groups to
which they belong. Marketers should recognize the extent to which a reference group influences the
consumer and he should also understand out of all the groups which group influences him the most.
Family
Family of a consumer plays an important role in the decision making process. The parents, siblings,
relatives all have their own views about a particular purchase.
Following are the roles in the family decision making process −
 Influencers − Influencers are the ones who give ideas or information about the product or
service to the consumer.
 Gate Keepers − Gatekeepers are the family members who usually panel the information.
They can be our parents or siblings too who can in any form provide us the information about
the product.
 Decision Makers − Family or our parents who usually have the power to take decisions on
our behalf are the decision makers. After the complete the research they may decide to
purchase the particular or dispose it.
 Buyers − Buyer is the one who actually makes the purchase of the product.
 End Users − The person who finally uses the product or consumes the service is the ultimate
consumer also called as End user as per the context.
A consumer gets influenced by his family members as well as friends. Since childhood the culture
which he follows or the rituals which he observes and the moral values and the religious principles he
usually receives them from his family. However, the individual learns fashion, attitude or style from
his friends. All these attributes or traits together influence the buyer’s decision making.

Cross cultural consumer analysis:

Cross-cultural consumer analysis is defined as the effort to determine to what extent the consumers of
two or more nations are similar or different. Such analyses can provide marketers with an understanding
of the psychological, social and cultural characteristics of the foreign consumers they wish to target, so
that they can design effective marketing strategies for the specific national markets involved. A major
objective of cross-cultural consumer analysis is to determine how consumers in two or more societies
are similar and how they are different. Such an understanding of the similarities and differences that
exist between nations is critical to the multinational marketer, who must devise appropriate strategies to
reach consumers in specific foreign markets. The greater the similarity between nations, the more
feasible it is to use relatively similar marketing strategies in each nation. On the other hand, if the
cultural beliefs, values and customs of specific target countries are found to differ widely, then a highly
individualised marketing strategy is indicated for each country. It is important for marketers to know this
in order to be successful in foreign markets. Another reason why marketers should invest in cross-
cultural consumer analysis is because a firm’s success in marketing a product or service in a number of
foreign countries is likely to be influenced by how similar the beliefs, values and customs are that
govern the use of the product in the various countries

Consumer decision making process:

The consumer decision-making process consists of seven steps, which are a stimulus, need
recognition, information search, evaluations of alternatives, purchasing decisions, and evaluation of
purchase decisions. These steps can be a guide for marketers to understand and communicate
effectively to consumers.

Stimulus

A stimulus is a cue or drive meant to motivate a person to act. A stimulus can be any of the following:
Social, Commercial, Noncommercial, Physical.
A prospective consumer may be exposed to any or all of these types of stimuli. If a person is
sufficiently stimulated, he or she will go on to the next step in the decision process.

Need Recognition

The very first step in the process is when consumers realize that they have a need for something.
Marketers want to create an imbalance in consumers between their present status and their preferred
status. This imbalance will create a need and make consumers search out and buy a product or service.

Need recognition occurs when a consumer is faced with a difference between an actual and the
desired state. A need can occur immediately and can be a very basic impulse that you experience. This
is called an internal stimulus. An external stimulus is when you are affected by outside influence.

Information Search

After the consumer has developed a want or a need, he or she needs to start an information search
about the different alternative selections that they can purchase to satisfy their need. An internal
information search consists of utilizing information from memory, such as past experiences with the
product.

An external information search is a process of seeking information in the outside environment

An example of an external information source would be marketing-controlled sources, such as radio,

television ads, brochures, etc. The amount of time dedicated to this step usually depends on the
consumer’s past experience with buying the product, the risk involved and the level of interest.

Evaluating Alternatives

Once the consumer has determined what will satisfy their want or need they will begin to seek out the
best deal. This may be based on price, quality, or other factors that are important for them. Customers
read many reviews and compare prices, ultimately choosing the one that satisfies most of their
parameters.
Purchasing Decision

In this day and age, Stage 5, the purchasing decision, is such an undervalued part of marketing. I
constantly see sales reps going into pitches with poorly designed decks, no real case studies that are
designed properly, nothing’s in the proper medium, and everything’s from 10 years ago or 5 years
ago. Everybody’s so worried about lead gen that they forgot that you can generate a million leads,
close none of them, and nothing matters.

What’s so critical at Stage 5 is that you can lower your cost per opportunity drastically hereby
affecting your close rate. See, when you look through an entire funnel, there’s so much money that’s
being spent in generating the lead that activating the lead and closing the deal is such an after-thought
in marketing that it’s not being funded properly.

Post-purchase Behavior

Frequently, the consumer engages in post-purchase behavior. Buying one item may lead to the
purchase of another. Re-evaluation of the purchase occurs when the consumer rates the alternative
selected against performance standards. Cognitive dissonance, doubt that a correct purchase decision
has been made, can be reduced by follow-up calls, extended warranties, and post-purchase
advertisements.

Evaluation of Decision

Finally, Stage 7, the evaluation of the decision. “Was this company the right choice for me?”

The reality is, is not every customer will love you and those ones that don’t are some of your greatest
learning opportunities.

There are also simple things like quarterly check-ins and monthly check-ins. Here, we do weekly
updates. The tighter you can get your feedback loop from customer success or customer failure and
then learn from that, the faster you can improve your deliverable, your product, or your service.

The reality is, the thing people pay you for has a huge part to do with how you’re marketing yourself.

So start to ask yourself, “What types of features, sets, or innovations can my service or product
pertain to or contain so that marketing it is a natural growth of what happens after someone purchases
it?” They can’t help but tell their friend, not one friend, but multiple friends. That post-purchase is
going to be critical for you as you go towards hyper-growth.

Nature and scope of sales management

Definition: Sales management can be seen as a segment of the organization’s marketing mix. It deals
with the formation of sales strategies; product merchandising and pricing; sales promotion activities;
distribution function; and planning, staffing, supervising, motivating and controlling of sales
personnel to attain the desired sales objectives.

It was initially limited to the guiding, directing and controlling of the sales personnel. But today, it has
a significant role in organizational success.
 UNIT-IV

Nature and Scope of Sales Management

To understand the concept of sales management clearly, we must go through its following
characteristics:

 Goal-Oriented: Similar to other management activities, sales management also have a specific
purpose and intended for the achievement of specified goals or objectives.
 Continuous Process: The sales manager needs to perform sales management functions
regularly, and this process is never-ending.
 Systematic Approach: It is an organized way of handling the sales function of the company
where every problem has a defined and proven solution.
 Relationship Selling: The salespeople make efforts to build a strong customer relationship to
sell the products or services effectively.
 Marketing Management Integration: Marketing is a broader concept; marketing
management includes all the activities related to sales management.
 Different Sales or Job Position: It is the combined efforts of the whole sales team, including
salesperson, sales executive, sales head, sales manager and after-sales service personnel.
 Pervasive Function: It is a universally applicable concept which has been adopted and tested
by every kind of business organizations.

Types of sales management

While some selling forms are about maximizing sales volume (numbers), others are about driving
revenue through high-value accounts. Some sales jobs have a short sales cycle completed over the
phone, while others have sales processes that take months or even years. Each type of sale involves
different skills and activities, so it's important to find your niche.
 B2C sales management: Business-to-consumer (B2C) sales involve selling goods and services directly
to consumers. B2C sales often drive leads from aggressive marketing strategies.
 B2B sales management:Business-to-business (B2B) sales involve selling goods and services directly to
other businesses. B2B sales tend to involve higher value products with longer sales cycles.
 Enterprise sales management: Enterprise sales involve selling complex goods or services directly to
large companies. Companies that sell enterprise solutions may have multiple teams for different aspects
of the sale, such as sales engineers and inside and outside sales teams.
 SaaS sales management: Software as a service (SaaS) companies sell software or applications over the
web, usually by subscription. SaaS products are often sold by an inside team who contacts potential
customers by phone or email and close the deal remotely.

Sales manager styles

Different situations and types of sales benefit from different sales manager styles. Academic research
frequently discusses the possibility that personality may make a person more inclined to a specific sales
management or leadership style. Take a look at four sales manager styles.
 Directive. The directive style is a management style that focuses on giving orders, assigning tasks, and
strictly monitoring the sales team's progress. It can prove effective when you set clear expectations. It
can also create a rigid environment, so you must encourage creativity and critical thinking. The military
uses directive management. 
 Participative. The participative style of management is the opposite of the directive style. As a
participative sales manager, you’re collaborative, focusing on achieving consensus and involving the
 entire team in decision-making. This encourages engagement and improves morale, but you must ensure
that decision-making remains fast and that you clarify roles and responsibilities.
 Coaching. Coaching managers support their sales team members through every step, from prospecting
to closing deals. You’ll work hard to understand each rep's strengths and weaknesses so that you can
provide individual support and guidance to each salesperson.
 Supportive. A supportive manager is always there for their team members, offering advice and
encouragement. As a supportive manager, you’re approachable, relatable, and friendly. If you adopt this
style, you’ll need to ensure everyone is accountable for their performance and expectations are clearly
defined.

Sales management responsibilities

As a sales manager, you’re responsible for the sales team's success. You’ll perform different tasks,
including:
 Recruiting: You’re in charge of hiring and onboarding new salespeople as your team grows. 
 Training: You’re responsible for ensuring your salespeople deliver the best possible customer
experience and meet their sales targets. This means identifying training gaps, modeling good sales
behaviors, training, coaching, and mentoring.
 Shadowing: To get to know your salespeople and their interactions with customers, you need to be out
in the field with them, on calls, and know how their behaviors map onto their results on key
performance indicators (KPIs).
 Meetings and aligning teams with objectives: As a sales manager, you’ll facilitate communication
between your sales team, support teams, and executive leadership. You’ll also set objectives and key
results (KPIs), for the sales team and ensure goals are communicated clearly and hit regularly.
 Forecasting and reporting: You need to report on sales performance while keeping an eye on long-
term growth projections—both can inform strategic decisions about the future direction of your team
and your company.
 KPI management: You need to get your entire team aligned around key metrics so they know what
day-to-day expectations are—and what it takes to succeed over time. You’ll break goals down into key
performance indicators and KPIs into model behaviors that lead to success.

Sales management objectives

A sales manager’s responsibility is to set long-term goals and objectives for their team. By
understanding how sales objectives fit into the organization, you’ll better understand the big picture and
can communicate better with senior management. Some of the main objectives of sales management
include:
 Revenue generation
 Increased sales volume
 Sustained profits
 Sales department growth
 Market leadership
 Prospect conversions
 Motivating the sales force

Conducting sales training programmes:

Successful Sales Training Program

Once you have those three key components in place, use the following five steps to build your training
program as part of your overall sales enablement strategy:
 1. Define Objectives and Key Performance Indicators (KPIs)

Your training program should support specific sales objectives, such as boosting quotas, speeding up the
sales cycle or achieving more wins. Start by clarifying what those objectives are; then, create materials and
training sessions that support each one. Using KPIs and other performance measures as guideposts
throughout the training process will help you evaluate your progress.

2. Identify Performance Gaps

Regularly assessing weaknesses in performance at the team and individual levels provides important clues
about where to focus training. If you see that the entire team has trouble promoting a specific service or
that some individuals repeatedly fall short of meeting their quota, you can create training modules and
materials to close those gaps.

3. Make Materials Accessible

Training is an ongoing part of a salesperson’s job, not something that only happens during onboarding or
new product launches. Set the expectation that training is a central part of each salesperson’s work; then,
make sure materials are easily accessible and frequently updated. Sales enablement software is particularly
useful for supporting these processes.

4. Boost Retention

You invest time and resources in training and then … your salespeople forget what you taught them. To
prevent this issue from happening, when you create training, add processes that boost retention, such as:

 Updating materials regularly and sharing them with the sales team.
 Requiring managers to meet with salespeople frequently to assess their knowledge.
 Coaching to help keep team members’ skills and knowledge fresh.

5. Ask for Feedback

A successful training program isn’t static. You need to know if the training is working and how you can
refine it, and the best way to find that information is to ask for feedback from salespeople and sales leaders.
Consider using anonymous surveys to gather honest reactions, and do it regularly. Use the input to refine
your processes, create new content and keep your training program on a successful path.

Evaluating sales training programme:

Below are the four successful points to evaluate sales training programme:

1. Revenue Results

Obviously, the main goal of sales training is to give your sales team the knowledge they need to make
more sales. To that end, the ultimate metric for determining the success of your sales training is the
number and quality of sales your team makes overall. Your sales training is intended to equip your
sales team with the information they need to identify prospects, engage them effectively, and
ultimately close the sale. Your curriculum should reinforce your strategy and tactics, targeting several
different parts of the selling process. Certainly, your sales team will bring their own personal expertise
and experience to the table as well. But the overall success of your sales operations will depend on the
tips, tricks, and processes you share with your team. Communicating them with your team is critical
to ensuring uniform performance across your entire operation. If you implement a new LMS, first
look to see how it’s affecting your team’s sales numbers. If there’s an uptick, it may mean you have
the right training in place. If numbers stagnate or go down, you may need to take another look at what
you’re teaching and adapt your content where necessary.

2. Employee Performance Reviews

The team’s sales results tell one side of the story. But individual employee performance reviews also
help measure how successful the sales training is. While the team’s performance is valuable to help
you assess your training, your team members aren’t robots. They each learn and perform differently.
When you examine the individual performances of your team members, you’ll be able to see which
ones benefited from your sales training the most when you track training. You’ll also get a better idea
of any variations in performance across the team. For example, let’s say you have a veteran member
of your team whose performance begins to lag before you implement a new sales training program. If
their numbers begin to improve, you may be able to chalk that up to the improvements in your team’s
training. Conversely, if new team members join and take an updated training course, but are being
routinely outperformed by existing team members who took an older training course, you may need to
adjust your material.

3. Sales Team Feedback

Numbers and stats are important in business. But you should also listen to what your employees are
saying about the training system, to see how you can optimize it. You can gather this feedback in the
form of surveys or other data points. The important thing is to press your team for their thoughts on
the course. To help start the process, here’s a few questions that you could ask them: 

 On [insert scale here], what was the difficulty of [name of course or training here]?

 Which parts of the sales training did you find the most engaging?

 What type of learning helps you retain information the best?

 Do you feel this course helped you? Comment below with honest feedback.

 Are there any more sales topics or lessons that you felt should have been added?

4. Post-Training Evaluation

Does your sales training have some sort of evaluation in place to help determine how much
information your team members actually learned during the training? This is where course content is
processed and applied, usually taking the form of a test or quiz following the course. It will accurately
reflect just how well they were able to retain the data. If your sales team members are consistently
scoring below average on their post-training evaluation, there may be an issue with the content, the
questions, or both. You can get a better handle on the specific problem when you ask your team for
their thoughts.
Reevaluating How to Track Sales’ Success

In summary, there are four indicators you can look at to determine the effectiveness of your online
sales training: 

1. Overall team sales

2. Individual employee sales

3. Feedback from your team

4. Performance on post-training evaluation

On their own, none of these will tell the whole story. But you can examine them together as part of an
integrated approach to determining the efficacy of your online courses. Rethink how you measure
your sales training’s success and also, how you develop your sales training to begin with. At
Knowledge Anywhere, we’re experts for advising on online training and eLearning. We can help you
empower your team and prepare them for success. To learn more about how we can partner with you
to create more effective sales training,

Compensation administering plans:

Compensation Administration

Compensation administration is an important aspect of human resource management, as it helps to

attract, retain, and motivate employees, and contributes to the overall financial health of the
organization.

The goal of compensation administration is to create a fair and competitive pay system that supports
the overall objectives of the organization.

Compensation administration also involves the ongoing review and adjustment of pay levels and
structures to ensure that they remain competitive and fair. This may involve conducting salary
surveys, analyzing pay data, and negotiating with employees or labor unions.

What is compensation administration in sales?

Compensation administration in sales refers to the process of designing and managing a compensation
plan for salespeople in a company. This may include a base salary, commission, bonuses, and other
incentives.

The goal of compensation administration in sales is to align the interests of salespeople with the goals
of the company and to motivate them to perform at their best. A well-designed compensation plan can
help to attract and retain top sales talent, and it can also serve as a tool for motivating and rewarding
high-performing salespeople.
What is the concept behind compensation administration?

Compensation administration is the process of designing, implementing, and managing a company's

compensation system. This includes determining the appropriate level of pay for each job within the
organization, as well as the specific pay elements (such as base salary, bonuses, and benefits) that
make up an employee's total compensation package.

The goal of compensation administration is to attract and retain top talent, motivate and reward
employees for their contributions to the company, and align compensation with the organization's
goals and values. To achieve these goals, compensation administrators consider a variety of factors,
including market trends, internal equity, and the organization's financial resources.

What are compensation administration guidelines?

Compensation administration guidelines are an important aspect of an organization's human resources

(HR) management and can help to ensure that employee compensation is fair, consistent, and aligned
with the organization's goals and values. 

Here are some main compensation administration guidelines that an organization may have in place:

1. Job classification and salary structure: This refers to the system used to classify jobs within
the organization and determine the appropriate salary range for each position. This may
include job titles, job descriptions, and job-specific duties and responsibilities.
2. Performance evaluations: This refers to the process by which an organization assesses an
employee's job performance and determines pay increases or bonuses.
3. Salary changes: This refers to the process for requesting and approving salary changes,
including promotions, demotions, and lateral moves.
4. Bonuses and incentives: This refers to the policies and procedures for awarding bonuses and
other types of financial incentives to employees based on individual or team performance.
5. Benefits: This refers to the various types of benefits that an organization may offer to its
employees, such as healthcare, retirement plans, and time off.‍
6. Dispute resolution: This refers to the process for addressing and resolving disputes or
appeals related to compensation. This may include procedures for filing a complaint or
request for review, as well as the roles and responsibilities of different parties involved in the
dispute resolution process.

What are the steps in the process of compensation administration?

Compensation administration is the process of developing, implementing, and maintaining a

company's compensation policies and programs. Here are the steps involved in the process of
compensation administration:

1. Determine the company's overall compensation strategy: This involves deciding on the
mix of compensation that will be used, such as base salary, bonuses, and benefits.
 2. Conduct a job analysis: This involves identifying the tasks, duties, and responsibilities of
each job in the company, as well as the skills, knowledge, and experience required to perform
the job.
3. Determine the market value of each job: This involves researching and comparing the
compensation offered for similar jobs at other companies in the same industry or geographic
region.
4. Set pay grades and ranges: Based on the market value of each job, the company can then set
pay grades and ranges for each job.
5. Develop a pay structure: This involves deciding on the relative value of each job within the
organization and how it will be compensated.
6. Implement the compensation plan: This involves communicating the compensation plan to
employees and implementing it across the organization.
7. Review and update the compensation plan: Compensation plans should be regularly
reviewed and updated to ensure they are competitive and aligned with the company's goals
and strategy.

What is the compensation administration process?

Compensation administration is the process of determining and managing the payment of wages,
salaries, and other forms of compensation to employees. It involves setting and reviewing pay scales,
determining pay grades and job classifications, and evaluating individual performance to determine
pay raises and promotions.

Here is a general outline of the compensation administration process:

1. Determine the organization's compensation strategy: This involves considering factors

such as the organization's financial resources, market conditions, and the competitive
landscape to determine how much to pay employees and how to structure pay scales.
2. Set pay scales and pay grades: Pay scales are ranges of pay for different job classifications,
and pay grades are specific levels within those ranges. Organizations typically establish pay
scales and pay grades based on factors such as the level of responsibility and skill required for
a particular job, and the level of education and experience typically required for the position.
3. Evaluate individual performance: Organizations typically conduct performance evaluations
to assess the contributions and accomplishments of individual employees. This information is
used to determine pay raises and promotions.
4. Determine pay raises and promotions: Based on the results of performance evaluations and
other factors, such as an employee's length of service and the organization's overall financial
performance, managers may recommend pay raises or promotions for individual employees.
5. Communicate compensation decisions: Once decisions have been made about pay raises
and promotions, it is important to communicate them clearly to employees. This can help
ensure that employees understand the basis for the decisions and that they feel fairly
compensated for their contributions.‍
6. Administer pay: This involves ensuring that employees are paid accurately and on time, and
keeping accurate records of pay and other forms of compensation.
What are the principles and objectives of compensation administration?

The principles and objectives of compensation administration are to:

1. Align employee incentives with the goals of the company: The compensation plan should
be designed in a way that motivates employees to work towards the goals of the organization.
2. Attract and retain top talent: A competitive and fair compensation plan can help a company
attract and retain top talent in the sales field.
3. Motivate and reward high-performing employees: The plan should provide incentives and
rewards for employees who exceed their sales targets and contribute to the overall success of
the company.
4. Foster a positive work culture: A well-designed compensation plan can help to create a
positive work culture and foster a sense of fairness and equity among employees.
5. Stay competitive in the market: The compensation plan should be competitive with those
offered by other companies in the same industry to ensure that the company is able to attract
and retain top talent.‍
6. Consider the financial goals of the company: The compensation plan should be designed in
a way that is financially sustainable for the company and helps it to achieve its financial
goals.

Motivating and compensation

What is sales team motivation?

In the world of work, sales team motivation is putting conscious effort into what keeps your
team engaged, focused, and confident about their ability to connect with your customer. They
are your brand ambassadors at the front line of the company, and their morale is connected to
company morale.

Everyone is motivated by different things , so it is extremely important to understand your team

at the core. Motivating people means understanding the whole person, and getting to know the
whys and the motivations behind each one.

What motivates sales teams?

People are unique, and what matters to them — as well as what motivates them — is unique as
well. However, it’s fair to say that when it comes to their work, people all want to be recognized
for their efforts (and a little extra money never hurts things, either). Here are four key motivators
that drive your sales team:

 Money: Many professionals get into sales because they want to have control over their
income. In commission-based roles, there’s often no limit on how much you can make.
Because of the high-earning potential, sales attracts money-motivated individuals.
 Career mobility: Successful sales professionals are recognized — and promoted —
based on their personal efforts. A new rising star can quickly distinguish themselves
from the pack with stellar performance or a novel approach.
 Recognition: There’s something thrilling about seeing your name at the top of the
leaderboard. In sales, it’s even better, since every win comes with a cash prize. The
 salespeople leading the pack are often driven by recognition and their desire to push
themselves to achieve their personal best.
 Purpose: Sales isn’t always about the money. While selling skills  are often transferable
across industries, most salespeople can’t get excited about selling a product they don’t
believe in. However, if your sales team believes in and feels connected to the company
mission, they’ll share that passion with your customers.

7 ways to motivate your sales team

So how do you tap into these motivators and get your sales team off to the races? Design
incentives and make leadership choices around the four areas you know mean the most to them.
Here are 7 ideas you can use to motivate your sales team.

1. Build trust 

Building trust is one of the most important methods for motivating your sales team. If you can
do this right, it will be a strong foundation for all the other ways you can motivate the team.  

But why is trust so significant? If employees trust leadership , their productivity, team unity, and
career satisfaction will increase. If there’s a lack of trust, that will lead to lower engagement,
higher employee turnover , and an overall decrease in performance. 

We all know when we have an inspiring leader  that we believe in, we’re more likely to be
dedicated to our work — that’s why building trust can have such a positive impact on sales team
motivation. Here are a few ways to start building more trust with your sales team, so that you
can motivate them more effectively: 

 Have integrity — do what you say you will, when you say you will 
 Spend time with your team — dedicate more than the occasional sales meeting to
getting to know your team members and what matters to them 
 Be positive — instead of becoming cynical or passive aggressive, keep your language
and your mindset positive
 Be open to receiving feedback — give your employees the opportunity to tell you how
you can do better, and then act on their constructive criticism when you need to 
 Listen and collaborate — instead of making the sales strategy all by yourself, ask your
employees for their input, and then implement their best ideas into the plan 
 Take action — when your employees need something, do everything you can to make it
happen (just don’t make false promises when things are out of your control)

2. Get in the trenches

This goes hand-in-hand with building trust. Show your team that you understand the work they
do on a daily basis. Get involved, and when they see you working hard next to them, they’ll be
more motivated — and achieve better sales results. Send them a lead. Cold call with them.
Strategize on a deal together. Be a hands-on leader. 

Spending time with your team will also make it easier for you to coach them,  provide valuable
feedback, and keep them encouraged throughout the day. Put the same effort into building
authentic relationships with your team members as you would with a customer — as a leader,
your sales reps are now your #1 customers.
3. Set goals — and celebrate when they’re accomplished

If you’re working closely with your team each day, you’ll be better equipped to help them
set SMART goals . These goals can be big — you should push them to get out of their comfort
zones. However, by working together, you can also make sure their sales goals are realistic.
After they set goals, try to remember when certain milestones are so that you also celebrate them
along the way. 

Hitting a big goal is cause for celebration, but don’t forget the small wins. This is important in
sales because not every day ends with a huge close. It can be easy to get caught up in the bottom
line. Make a habit of celebrating the activities that get you to the big wins. First meetings?
Demos? Next steps? All are worthy of celebration.

4. Optimize your leadership style

Not every situation calls for the same management style . If you’re dealing with workplace
conflict, you’ll want to be a little more diplomatic. However, if you have an employee suffering
from poor performance , you’ll need to be more of a coach. Remember, a lack of motivation  can
come from anywhere, so there’s no one-size-fits-all solution. 

Consider your team’s needs and what they’re tackling right now. How can servant
leadership, transactional leadership , or a democratic style of leadership  motivate them? You can
also ask for their feedback. Maybe they have certain needs that you’re not meeting right now,
and with a little adjustment, you could motivate them in new ways . 

5. Offer opportunities for growth and development

Talk to your sales reps about their strengths, their plans for the future, and upcoming
promotions . Build plans around performance and interests. But don't stop at just offering career
opportunities. Offer your reps the opportunity to truly thrive as whole people while building
careers in this demanding profession.

Many sales reps are struggling with the changing sales landscape. Traditional sales investments
focus on productivity tools and ad hoc training, rather than building the skills and behaviors that
ultimately impact performance. At BetterUp, we believe supporting sales leaders  in building the
mindsets and behaviors to thrive and inspire will help them motivate and coach their teams to
succeed personally and professionally.

6. Offer financial incentives  

If you want a simple way to boost sales team motivation, monetary incentives could be the way
to go. These could include spot bonuses, contests, or higher commissions. You could even adjust
compensation plans completely for top performers. Rewards are a great way to power your
team through periods of low motivation.  

Offering a financial incentive is a great way to make an immediate impact on your team — but
don’t fall into the trap of thinking it’s all they care about. We'd be lying if we said money
doesn't still matter, but it isn't all that matters. People have walked away from tremendous
compensation packages because they didn’t feel appreciated or valued in the ways that matter to
them. 

7. Say thank you often 

It is easy to put your head down and focus on your workload, but try your best to say “thank
you” — at least weekly. People need to know that their efforts are recognized and appreciated .
You can never say “thank you” too often. If you can, be specific about why they make a
difference.