PHASE 13: PRICE INCENTIVES

Improve adherence to your pricing strategy by aligning it to the sales team’s Compensation Design & Quota Setting.

 

Sales people, for the most part, do what you incentivize them on. Unfortunately, that means that if they are incentivized on revenue only, this often leaves to heavy discounting, lower average selling price, and much lower profitability. Organizations that adopt a value-based culture focus on price integrity. Price integrity means giving sales reps a personal stake in price realization. Doing so in a way that is both motivating and robust is both an art and a science.

Rapid Diagnostic

1. Your compensation plan is designed to support your pricing strategy.

2. Your sellers are keenly aware of the impact of discounting on profitability.

3. Your compensation plans discourage discounting and promote value selling.

4. Your sellers understand their compensation plans and the relation to company profits.

5. There is a low percent of deals sold at the seller maximum discount rate.

6. Your A Players have a lower discount rate than your B Players.

7. Your B Players have a lower discount rate than your C Players.

8. You have calculated your win rate at list price and each tier of discounting.

9. Sales commission plans reduce if they give greater discounts to customers.

10. You produce financial modeling for profitability every time you update your Compensation Design and set Quotas.

Deliverables

• Price Incentive Assessment

• Price Incentives Strategy

• Price Incentive Quotas

• Communication Plan

• Financial Modeling

• Integration into your Compensation Design & Quota Setting

INDUSTRY
STRATEGY AREA
CONTENT TYPE
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Case Study: Activating the Product Function
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