Sales Compensation Structure: What You Need to Know Now

July 28, 2015 William Finnen

Are you constantly tinkering with your sales comp plans? Do you fret about how steep your sales rep ramp time is? Are you wondering how other companies set goals for on-target earnings (OTE)?

If so, you’re not alone. Companies in virtually every industry are struggling to strike the right formula that will not only help them hire the best reps, but also motivate them to perform at the peak of their potential.

Why is this so important right now? Consider how quickly the landscape is changing:

  • Hiring competition for sales reps has become especially fierce
  • Inside sales teams are increasingly specialized into diverse roles
  • Technology is enabling greater insight into specific sales activities
  • Lead distribution is becoming more targeted and complex
  • Marketing’s influence on the B2B pipeline is stronger than ever before
  • Inbound sales reps are increasingly reporting to marketing

And that’s just the tip of the iceberg. For example, if you’re like more than half of B2B companies, you have SDRs setting appointments for Account Executives, who then create opportunities after many of those meetings and close them. Here’s where it gets complex: do you provide a bonus for the appointment-setting SDRs on the opportunities that AEs can then close? Should compensation also be tied to a certain measurable activity threshold, such as calls, emails or conversations? Or should their entire OTE be based on the appointment-setting goals attainment?

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The post Sales Compensation Structure: What You Need to Know Now appeared first on RingLead.

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