A motivated sales force sells more, stays longer, and represents your brand better. However, many companies still rely solely on monthly bonuses to motivate their teams. The result: motivation that rises at the end of the month and plummets the next day.
A well-designed sales incentive plan combines money, recognition, growth, and experiences. Here are 7 proven models and how to choose the right one for your team.
What is a sales incentive plan?
It’s a set of rules and rewards that rewards salespeople for achieving specific goals: volume, coverage, product mix, new customers, or point-of-sale execution. Its objective is not just to pay more, but to align the team’s efforts with business priorities.
Why the bonus is not enough
The financial incentive is important, but it has its limits:
- It becomes part of the expected salary and stops feeling like a reward.
- Reward the result, not necessarily the correct behaviors.
- It does not generate an emotional connection with the company.
- It’s easy for the competition to match.
That’s why the best plans combine several types of motivation.
7 incentive models that work
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Tiered goals by level
Instead of a single goal for everyone, you define progressive levels. Each salesperson sees an achievable objective and the next step. This motivates both those who are close to the goal and those who are lagging behind.
Ideal for: teams with very different performance levels.
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Points-based rewards catalog
Each achievement earns points that the seller can redeem for a catalog of products, experiences, or gift cards. The ability to choose makes the reward more personal and memorable than a deposit.
Ideal for: large sales forces or those distributed across multiple regions.
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Limited-time contests and campaigns
Short-term strategies to boost a launch, a category, or a season. Urgency generates spikes in activity.
Ideal for: specific tactical objectives.
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Rankings and gamification
Leaderboards, badges, weekly challenges, and levels turn the goal into a game. Healthy competition and visibility of progress increase participation.
Ideal for: young or highly competitive teams.
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Public recognition
Celebrate achievements in front of the team, through internal communications, or at events. Recognition has a low cost and a high impact on engagement.
Ideal for: complementing any other model.
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Convention travel and experiences
Rewarding top performers with an exclusive trip or event creates an aspirational goal and an experience the salesperson will remember for years.
Ideal for: high-performing teams and annual goals.
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Training incentives
Reward the completion of courses, certifications, or product evaluations. A salesperson who knows their product better, sells more.
Ideal for: technical products or frequent releases. E-learning platforms allow you to track and evaluate each module.
How to choose the right model
Ask yourself these questions:
- What behavior do I want to drive? Volume, mix, new customers, collections, or execution.
- What is my team like? Size, profile, geographical dispersion, and performance level.
- How often do I want to measure? Weekly, monthly, quarterly, or annually.
- What is my budget and how is it self-financed? The incentive must be paid for with the incremental results it generates.
- How am I going to communicate it? A plan that the salesperson doesn’t understand doesn’t motivate them.
In most cases, the best option is a combination: tiered goals + awards catalog + recognition, with tactical campaigns throughout the year.
Mistakes you should avoid
- Impossible goals: they are more demotivating than having no incentive.
- Rules that change mid-term: they destroy trust.
- Late payments or rewards: the reward loses its effect if it arrives months later.
- Reward only the top 3: the rest of the team disconnects.
- Not measuring: without data you won’t know if the plan generates incremental sales.
Example: incentives for channel and sales force
In Coca-Cola’s Select Partner program, LMS designed a scheme for the traditional channel and sales force that fosters a supportive relationship among participants to achieve specific goals. Benefits include business-enhancing awards, lifestyle products, and branded merchandise, delivered monthly.
Comparative table of incentive models
| Model | Description | Ideal for |
|---|---|---|
| 1. Tiered goals by level | Progressive levels with achievable goals step by step. | Teams with very different performance levels. |
| 2. Points-based rewards catalog | Accumulate points redeemable for products, experiences or cards. | Large or distributed sales forces across several regions. |
| 3. Limited-time contests and campaigns | Short-term dynamics with urgency for peak activity. | Specific tactical objectives. |
| 4. Rankings and gamification | Leaderboards, badges, challenges, and interactive levels. | Young or highly competitive teams. |
| 5. Public recognition | Celebrating team achievements, announcements, or events. | Complement any other model. |
| 6. Convention travel and experiences | Aspirational and memorable awards for top performers. | High-performing teams and annual goals. |
| 7. Training incentives | Rewards for courses, certifications, and product evaluations. | Technical products or frequent releases. |
Frequently Asked Questions
What percentage of sales should be allocated to incentives?
There’s no single figure. It should be calculated based on the profit margin and the expected incremental results, so that the plan pays for itself.
Is it better to give money or prizes?
Prizes and experiences tend to create a stronger memory and emotional connection; money is more flexible. Combining both usually yields better results.
How do I prevent the plan from becoming routine?
Refresh campaigns, change challenges, and communicate progress constantly.
Design your incentive plan with LMS
At LMS, we design incentive plans for sales teams, distributors, and traditional channels, incorporating gamification, a rewards catalog, delivery logistics, and real-time tracking. Request a proposal and motivate your team with a plan that actually works.
