A closed-won commission is a type of commission that is paid to a salesperson when a deal is closed.
This type of commission is typically paid as a percentage of the total value of the deal, and is a common type of commission structure, as it can be an effective way to incentivize salespeople to close deals.
We most often use the term closed-won commission when referring to sales development rep compensation plans. That’s because you might pay an SDR a single rate bonus tied to the number of opportunities they create, also what we call a Qualified Opportunity Bonus. Or, you might implement a Demos Completed Bonus, which pays a fixed amount to the SDR based on the number of demos they complete.
But usually, it’s either one of the plans above (or both) paired with a Closed-Won Commission structure. This compensation design pays the SDR a percentage of the deal when the account executive goes on to close-win a deal that began with a lead generated by the SDR.
For a combination of these structures, check out the following templates:
- Qualified Opportunity Bonus & Closed Won Commission
- Opps Created & Demos Completed Bonuses, & Closed Won Commissions
There are a few things to keep in mind when using closed-won commissions.
First, it is important to set clear and realistic goals for salespeople. If the goals are too difficult to achieve, salespeople may become discouraged and give up. Second, it is important to track closed won commissions carefully. This will help you to ensure that salespeople are actually closing deals and earning commissions. We recommend a commission tracking solution like ours.
Finally, it is important to be fair and logical when paying out closed-won commissions. Don’t overcomplicate it.