The demand for sales enablement is growing rapidly.

According to Korn Ferry, the practice of sales enablement in sales organizations has practically doubled since 2017.

So, it’s not surprising that Gartner expects sales enablement budgets to increase by 50% over the next five years.

This growth is being driven by consistently shifting buyer preferences that require sellers to continually adapt and change the way they sell. Otherwise, companies risk falling behind the competition as the buyers’ journey becomes increasingly self-service with less sales involvement.

Enablement arms reps with the right tools, training, coaching, and content to effectively engage with buyers earlier in the sales process and influence buying decisions.

But this is just the tip of the iceberg.

Let’s take a closer look at the practice of sales enablement and the role of sales enablement manager.

What is sales enablement?

Korn Ferry’s sales enablement definition is “a strategic, collaborative discipline. It’s designed to improve sales results by providing consistent information, training, and tools that allow sellers and their managers to add value to every customer interaction.”

Establishing a sales enablement practice benefits sales teams by increasing sales revenue, improving client acquisition for the sales team, and creating more selling time for sales reps.

According to the State of Sales Enablement Report, organizations with sales enablement processes or practices in place for two-plus years report a 7% improvement in win rates and up to 14% better quota attainment. These organizations are also 48% more likely to experience high buyer engagement and 10% more likely to have greater rep engagement which reduces sales rep turnover.

Implementing a sales enablement practice involves providing reps with:

• Strategic sales content: Content intentionally created for different buyer roles and scenarios making it easier for reps to stand out in the competitive landscape and grab buyers’ attention.
• Tailored sales plays: Structured guidance on how to approach various selling situations based on the specific buyer and their needs.
• Optimized cross-functional communications: Better communication across customer-facing teams creates a seamless buying experience while unifying internal teams.
• Continuous training and coaching: To optimize sales rep performance and knowledge.
• An effective tech stack: To streamline sales processes and increase efficiency.

That’s what sales enablement is. Now, let’s look at the person who executes this practice.

What is a sales enablement manager?

A sales enablement manager is one of the core members of any effective enablement team. This person is responsible for implementing programs and initiatives that allow customer-facing teams to successfully execute key elements of their roles, especially in terms of sales and revenue.

The responsibilities of a sales enablement manager typically include :

• Initiating the creation and implementation of relevant training, content, sales messaging, processes, materials, and tools to support the sales or revenue team.
• Supporting product launches by preparing and empowering sales reps to understand and sell your products or services.
• Handling foundational and continuous learning programs for sales. This includes aspects like training content creation, scheduling, delivery, and deployment.
• Tracking and analysis of sales enablement content, courseware, and platforms.
• Supporting the buying and selling processes throughout the buying journey from lead generation through its conclusion.
• Supporting the sales leadership team and frontline sales managers in performing management and coaching activities.
• Managing and coordinating sales enablement projects and activities.

Sales enablement managers commonly possess characteristics like:

Data-driven to gauge initiative results

Tech stack tool mastery to easily select the best tools for their team

Project management to facilitate handling multiple projects and initiatives concurrently

Keen knowledge and understanding of the Buyer’s journey to easily recognize changes and keep selling processes and motions aligned

Excellent communicator for easy cross-function collaboration and developing trust and behavioral change

Astute trailblazer to facilitate adapting sales to the evolving marketplace and buyers

Effective collaborator since they work across multiple revenue teams

Efficiently organized so they maximize their resources and make the most of their time.

Sales enablement managers are essential for developing support and momentum for initiatives that drive sales rep behaviors and outcomes.

Sales enablement manager salary

How much do sales enablement managers make? Great question. The average total earnings for sales enablement managers in 2023 vary depending on the information source, the geographic location, and the individual’s experience level.

According to ZipRecruiter, sales enablement managers earn an average of $110,915 a year.

Glassdoor pinned the salary a bit higher. Their data showed that a sales enablement manager’s average total annual earnings are $114,015 a year. This is based on an average sales enablement manager salary of $96,568 per year plus additional pay of $17,448 in the form of a cash bonus, commission, and profit sharing.

Meanwhile, salary.com’s aggregated data put a sales enablement manager salary at $105,047.

Lastly, the Sales Enablement Collective’s (SEC) Sales Enablement Salary Report 2023 showed that the average base pay for sales enablement managers responding to their survey earned $114,908 per year plus bonuses or commissions.

How has this salary changed over the years? The SEC’s 2022 report found that sales enablement professional salaries increased by 10.9% from 2021 to 2022. Plus, 75% of the 2022 respondents indicated they received some sort of bonus or commission in addition to their base salaries.

Sales enablement manager comp plans

If you’re curious how to approach a sales enablement manager compensation package, the SEC’s 2022 report included the most common breakdowns:

• Base/OTE dispersion of almost 75:25
• 25% variable, with a ratio of 50% personal and 50% business performance
• Bonus split 50/50 between quarterly revenue targets and personal objective-based incentives (MBOs), payable quarterly
• An employee stock plan
• 10% guaranteed restricted stock units (RSU)
• 10% of base salary paid quarterly if objectives are achieved
• An 8% bonus every year
• 20% of total comp is variable pay
• Uncapped commission if reps hit quota

Geographical differences in sales enablement manager salary

Sales enablement managers’ salaries vary based on geography. For example, sales enablement professionals are paid more in North America than elsewhere in the world, according to both SEC salary reports. 

What’s more, according to ZipRecruiter, the top 10 highest paying cities for sales enablement manager jobs included Berkeley, CA topping the list, followed closely by Daly City, CA, and San Mateo, CA. The top three beat the national average by 22.7 – 27.9%. Plus, there was a variance of 12% in sales enablement managers’ salaries between Berkeley and the 10^th city on the list, San Diego, CA.

Sales enablement manager jobs and experience

To get a better understanding of the available job market for this role, we sourced the same platforms above. Our search revealed that ZipRecruiter currently has 756 sales enablement manager job postings, the most among the platforms we queried.

Skills and experience commonly required include:

• 4-5 years of sales or sales enablement experience: Gives you a deep understanding of sales processes and their relationship to the buyers’ journey.
• Experience with training content development and delivery: Facilitating effective sales training.
• A strong understanding of go-to-market motions and how enablement fits in: To be able to actively participate in the creation and implementation of GTM strategies and know your role in the process.
• Excellent written and oral communication skills: to be able to effectively communicate with team members across the organization.
• Expertise in using and learning a range of software, including Salesforce and LMS platforms: To efficiently use software, effectively build and maintain the best tech stack for the sales team, and teach the sales team how to use it. 
• Proven success in time management and meeting deadlines: To juggle the many demands placed on a sales enablement manager.
• The ability to learn complex and technical subjects very quickly: To easily keep pace with the ever-changing technologies involved.
• Strong collaborative and interpersonal skills: To work well with a large number of cross-functional stakeholders.

How to become a sales enablement manager

Considering a job as a sales enablement manager? To secure a position in this role it’s best if you have a bachelor’s degree and several years of sales or marketing experience. 

You don’t need a specific type of degree, but one in business or marketing can boost your chances.

Sales enablement managers often start out in a sales rep role and ascend to a supervisory role. Others transition into a marketing role, or a sales training or operations position.

Additional skills that will increase your odds of attaining a sales enablement manager position include:

• Excellent organizational skills
• Effective communicator
• Being self-motivated
• The ability to multi-task
• Familiar with a variety of software and technologies
• Experience creating content

If you’re missing some of these additional skills, don’t let that stop you from pursuing the role. Connect with enablement managers in your network and learn how they got into their roles. Plus, if you’re a rep right now, see if you can collaborate on enablement projects to start building out your experience and enablement portfolio.

Boost sales rep performance with sales enablement

A sales enablement manager is one of the core members of any effective enablement team. They are critical for creating support and momentum for programs that drive sales rep behaviors and outcomes.

The average sales enablement manager’s salary is between $96,568 and $114,908 plus a bonus or commission. You only need a bachelor’s degree and several years of sales or marketing experience, plus some key skills to become a sales enablement manager. There are no role-specific degrees or training requirements to get started. Although, you could earn certification from this HubSpot Academy Sales Enablement Training Course. 

About QuotaPath

QuotaPath automates sales commissions to bring standardization, visibility, and efficiency to your variable compensation process. Motivate your revenue team by providing real-time insights into sales compensation, forecasted earnings, and attainment. Trust the data is accurate by syncing directly from your CRM and providing a source of truth for Sales, Finance, and RevOps. Start a free 30-day trial with QuotaPath, or schedule a demo with a team member.

Learn how to comply with ASC 606 revenue recognition when it comes to sales commissions.

To keep financial records complete, accurate, and comparable, companies follow five core accounting principles. These include: the revenue principle, the expense principle, the matching principle, the cost principle, and the objectivity principle.

When compliant with these principles, companies put themselves in the best position to succeed with investors, valuations, buyers, and more.

But, these principles — and standards to help companies meet the criteria — often change as markets evolve.

One newish standard that is of particular interest to us is ASC 606, which the Financial Account Standards Board (FASB) created ASC 606.

What is ASC 606? It’s an accounting standard that dictates which accounting periods businesses should attribute revenue and expenses. This revenue recognition principle applies to any company with recurring costs. 

So, businesses that offer goods and/or services under a written agreement must pay attention to this rule. Because failure to comply puts you at risk of incurring substantial fines and an unexpected audit visit.

Aside from the non-compliance risks, adhering to ACS 606 helps businesses gain a better picture of their financial health. Establishing this practice is especially important for startups wishing to raise money by approaching investors or applying for bank loans.

When did ASC 606 become effective? The FASB introduced this new revenue recognition principle in 2014. The rule applied to public companies in 2018, followed by private businesses.

Then, the FASB added Subtopic 340-40 to ASC 606 and became effective for fiscal years after December 15, 2017. Under this subtopic, Other Assets and Deferred Costs: Contracts with Customers, it’s necessary to implement ongoing reporting and record-keeping of costs incurred while securing or fulfilling a contract with a customer. These costs include advertising, travel expenses, and sales commissions.

To comply with ASC 606, we recommend following the five steps below.

Steps to be compliant with ASC 606

Before we dive in, understand that the complexities of revenue recognition vary slightly based on the specific goods and services sold. In SaaS, where subscription-based sales are most common, ASC 606 compliance grows an added layer of complexity. 

For subscription-model businesses,  comply with ASC 606 revenue recognition by following this 5-step approach. 

Step 1. Identify the contract with a customer

First, identify the contract. In terms of ASC 606, a contract marks an agreement between two or more parties and requires:

• Approval by all parties
• Definitions of the obligations of all parties and verify they are committed to executing the agreement
• Identifying the goods or services being supplied
• Detailing the payment terms
• Showing that the contract or deal is commercially substantive, predicating that the future entity cash flows will change
• That it’s based on the likelihood that payment will be received by the vendor for the goods or services being transferred

Step 2. Identify the performance obligations in the contract

Next, you’ll want to outline the performance obligations in the contract. In the context of a contract, we define performance obligations as promises made in the agreement between the vendor and the customer. Under ASC 606, businesses must itemize what the rule refers to as “distinct” performance obligations. What makes each performance obligation “distinct” is being of value to the customer as a standalone item,  independent of other goods and services in the contract.

Step 3. Determine the transaction price

Now, you’re ready to determine the transaction price, which is the agreed-upon price the vendor expects the customer to pay in exchange for the goods or services is the transaction price. This figure excludes sales tax or other third-party variables. You must also consider the value of all cash and non-cash compensation and factor in any discounts or other pricing modifications designated in the contract.

Step 4. Allocate the transaction price

Then, you’ll allocate the transaction price. This is the step where the total transaction price is divided and attributed to specific performance obligations under the contract. This can be particularly difficult to determine for recurring payments under a subscription-based transaction where the performance obligation is continuous.

Step 5. Recognize revenue when the entity satisfies the performance obligations

This next step is the most important as it pertains to sales commissions. In Step 5, you should aim to recognize revenue for performance obligations as your team completes them. This typically occurs when the contract starts or when you receive payment. In the case of a single performance obligation, you should recognize the revenue in the accounting period when the order is fulfilled — not when the customer places the order.

However, for a continuous performance obligation, such as a year-long subscription to a software service that’s paid monthly, you will recognize each monthly payment during the accounting period when the funds are received.

How QuotaPath’s Ledger can help with recognizing and reporting commissions correctly

The five steps above will help you remain compliant. You can manage amortization schedules manually, via spreadsheet, or you can recruit the help of a smart solution to do it more accurately and efficiently. 

QuotaPath Ledger allows your accounting team to consistently capitalize and amortize commission expenses in compliance with ASC 340-40. 

Ledger provides the flexibility to recognize commission expenses according to your scheduling requirements.

With Ledger, you simplify month-end closing processes, keep up with all the details as they arise, and eliminate errors. Plus, you gain the ability to create easy-to-read, audit-ready reports quickly.

Start complying with ASC 606 revenue recognition

Failure to comply with the revenue recognition principle carries risks like fines and surprise audits. Aside from risk avoidance, proper revenue recognition enables businesses to gauge their financial health. Although this is valuable for all businesses, it is particularly important for startups that want to raise money.

Are you ready to simplify ASC 606 revenue recognition? Try QuotaPath for free for 30 days, get familiar with Ledger, and integrate with Stripe or QuickBooks for seamless implementations.

The following blog includes free commission calculators to help you manage and track deals.

Regardless of how attractive a compensation plan may be, it won’t motivate salespeople unless they understand it.

The ability to accurately calculate their actual and forecasted earnings gives sales reps a clearer understanding of how their comp plan works. It’s also a great way to help your sales team learn how to optimize their earnings.

Armed with this information, salespeople can set personal and professional goals that inspire them even more than the money itself.

This is important because there are two types of motivation to keep reps motivated:

• Extrinsic motivation: To work harder for a higher commission rate and a particular outcome.
• Intrinsic motivation: Taking action to fulfill a personal desire or goal.

Most salespeople are motivated by some combination of these two. 

So, it’s important to give them the tools necessary to show how they’re trending toward extrinsic and intrinsic factors. For instance, by showing how deals in the pipeline amount to actual earnings for the rep, you create concrete gains or losses. That way reps can see and understand the personal impact of winning or losing the deal. 

 According to Thomas Egbert, Head of Finance at Prefect, this is a must.

“Now that I’ve seen that reps have visibility into how their pipeline translates into earnings, and how powerful it is to be able to forecast deals, I’d absolutely consider this feature a requirement,” said Thomas, who implemented QuotaPath with his team.

This visibility also empowers reps to own and optimize their potential earnings.

A, “Our reps realized they could run scenarios and see how much they could earn from our monthly kickers.,” said Joe St. Germain, VP of Sales at Blackthorn.

This led to big pushes from reps as they moved to maximize the accelerators set by Joe fully. QuotaPath’s ability for reps to run “what if” scenarios also broke down how much they would need to book monthly to lock in an extra 2 percent per deal toward the end of the year.”

That’s the type of clarity, accountability, and motivation you can foster with QuotaPath’s sales incentive platform. But if you’re not ready to begin a 30-day trial to automate commission calculations, we offer free compensation tools that you can immediately adopt. 

Commission calculators

Commission calculators simplify tracking and computing sales compensation earnings per sale or period, quotas, commission rates, and on-target earnings (OTEs). These templates help sales reps figure out where they stand while giving leadership a starting point to build comp plans.

We created a couple of free commission calculators to make your life easier:

Sales commission calculator (for reps)

This easy-to-use commission spreadsheet streamlines the process of tracking and calculating sales commissions. It only takes 4 inputs and 3 simple steps to see how much an individual sales rep has earned.

Here’s how it works:

• Download your free sales commission calculator.
• Input your Base Salary, Commission Rate, Quota, Quota Frequency, and On-Target Earnings on the ‘Home’ page of the spreadsheet.
• Navigate to the ‘Deals’ tab to input your deals.
• View your total sales and commissions on the ‘Monthly Totals’ tab to track the attainment of your monthly goals and commissions.

For example:

Judy has a base salary of $50,000 with a monthly quota of $40,000 and a 10% commission rate, so her OTE is $98,000.

She enters her deals into our handy commission calculator to make sure she’s on track to hit quota:

1st deal for $20,000 = $2,000 commission

2nd deal for $8,500 = $850 commission

3rd deal for $12,500 = $1,250 commission

4th deal for $6,500 = $650 commission

On the ‘Monthly Totals’ tab she can see that her total sales for the month are $47,500 and she has earned total commissions of $4,750. This might also qualify her for an extra bonus or accelerator.

All Judy had to do was enter a few figures — no complex computations required.

Sales compensation calculators (for leadership)

Our free Sales Compensation Calculator consists of three calculators in one. It simplifies the process of determining sales quotas, commission rates, and on-target earnings (OTEs).

Each of the three calculators uses the same five variables of quota, commission rate, variable compensation, base salary, and OTE. When you input three variables the other two are calculated for you.

Sales Quota Calculator

When you use the sales compensation calculator to generate a sales quota, you need to input the base salary, OTE, and commission rate. 

The application subtracts base salary from OTE, resulting in the variable compensation value. It then divides variable comp by the commission rate to determine the annual quota. 

Next, it divides the annual quota by 12 or 4 depending on whether you requested a monthly or quarterly quota.

Commission Rate Calculator

The Commission Rate Calculator is the second of the three calculators in the Sales Compensation Calculator. 

How to find a commission rate with the calculator: Start by providing base salary, OTE, and quota, then select yearly, monthly, or quarterly from the dropdown.

Variable compensation is calculated first by subtracting base salary from OTE. Then we divide variable comp by the quota figure you entered to generate an annual rate or divide it by 12 or 4 to result in a monthly or quarterly commission rate according to your selection.

On-Target Earnings Calculator

The OTE calculator is the third calculator in the Sales Compensation Calculator. You need to input base salary, commission rate, and quota to find OTE. We multiply the quota by 1, 4, or 12, based on whether you specified yearly, quarterly, or monthly quotas. 

This results in the variable compensation figure, which we then add to the base salary to generate your OTE.

Commission tracking with QuotaPath

Although simplicity is essential when creating a comp plan, you sometimes need to go beyond a single rate commission plan. 

Adding new compensation plans or scaling your sales organization adds complexity to your comp plan. That’s when it’s time to consider automating the process of tracking and calculating sales commissions in lieu of manual processes.

It’s easy to get started with QuotaPath. Sign up for a 30-day free trial. 

Then complete three simple steps:

1. Build your sales compensation plans.
2. Sync your CRM.
3. Invite team members.

Our Home feature guides you through the onboarding process to get you up and running and will flag for you a priority of tasks once you’re up and running.

Then you’re ready to use QuotaPath to automate commission calculation and tracking.

Start using a sales commission calculator

Sales reps are only motivated by their comp plan when they fully understand it. 

Enabling them to run what-if scenarios inspires them to set personal goals that further fuel their motivation to achieve greater success.

Commission calculators can help sales reps gain a better understanding of their full earnings potential and see how they can reach both their quota and personal goals.

Additionally, commission calculators lend a hand to leadership looking to simplify the process of determining sales compensation calculations like sales quota, commission rate, and OTE.

When it’s time to scale your sales force or go beyond a single rate commission, manual methods simply aren’t effective or accurate. That’s when it’s time to automate the process of tracking and calculating sales commissions. See how easy it is to automate sales comp calculations. Sign up for a free 30-day QuotaPath trial. Or, schedule time with our team to see how our solution can support your compensation models.

One of the biggest challenges we see in sales compensation management is a lack of access to information across teams. 

What’s more, when that information is available, it’s often spread across multiple channels or spreadsheets, sending people on a wild-goose chase to find the data they need. 

We aim to solve this.

On the heels of our latest feature releases, Home for Admins, and expanded self-serve integrations, we released additional holistic views to present the most valuable compensation data for individual earners and comp managers. 

Called Home for Reps and Member Details, these new dashboards pull insights, tasks, and deal data history into one place, enabling users to work more effectively in and outside of QuotaPath. With these two additions, QuotaPath continues to deepen sales compensation clarity for all parties impacted by variable pay.

Learn more about Home for Reps and Member Details below.

Build rep accountability and ownership with Home for Reps

Sellers can start here for an overview of earnings per month or quarter, plan payment breakdowns, and payouts.

One of the best parts of QuotaPath’s Home for Reps is how it encourages seller accountability and ownership of their sales compensation. 

Instead of sending your reps to finance and accounting when they have questions about their commission plan or payouts, you can direct them to QuotaPath’s Home for Reps. Plus, with mobile-friendly views, reps can check it anywhere, anytime, whether they’re at the office or on the road. 

With this seller-focused user experience, reps will have easy access to the answers to their most pressing compensation questions. When will I get paid for this deal? How much will it be? How close am I to hitting the next commission tier? What will my next commission check be? What SPIFs am I eligible for? Did finance address my question yet? Send them to QuotaPath.

Upon logging in, reps will see from the first screen they land upon what, why, and when they’re getting paid across all of their deals in a UX-friendly view. Here, they can also see an overview of their individual performance, forecasted earnings according to their pipeline, and task alerts.  

A monthly breakdown shows the rep how they’re performing against their compensation plan split up by each comp plan component, such as SPIFs, accelerators, and bonuses. 

Do your reps have personal goals they’re working toward, like a down payment, car, or vacation? Home for Reps also has a designated spot to showcase the seller’s progress toward their personal goals. Reps can add goals directly from this page and gauge how close they are to achieving their goals every time they log in.

Plus, anytime they raise a flag in-app (deal flagging) over a deal payment they have a question on, Home for Reps will alert them when it’s been resolved or if additional communication is necessary. If your team introduces compensation plan changes or a new plan, your reps will also be notified here to verify their understanding using our plan verification tool. 

With Home for Reps, motivate your sellers by keeping them privy and connected to their earning progress in an easy-to-understand view with the data that matters most to them.

Manage commissions by rep using Member Details

Start with Member Details to execute the steps needed to pay the seller.

Just as our Home for Reps dashboard is making it easier for reps to access their commission information, our new Member Details view will consolidate relevant deal data at the individual-rep level to allow effective commission management.

Need to check how a rep is getting paid or look into a previous payment? Looking at the rep’s performance over time before moving to a new role?  Helping a rep understand their quota attainment across multiple deals?  

Member Details pulls in everything you need to know regarding a single rep’s earnings history and upcoming payouts from one page. 

Use the Tasks tab at the top to see by rep what deals need approval, which deals have discrepancies, what flags remain unresolved, and how many payments you owe.

Explore total earnings, approved earnings, and total closed/won deals by month, quarter, year, or a custom date range. See what compensation plans this rep follows and what previous plans they’ve received payments under. 

This view organizes each piece of the seller’s compensation plan. In doing so, you can navigate QuotaPath more efficiently and take in-app actions necessary to ensure your reps received accurate and timely payments.

Smart sales compensation management 

Now with QuotaPath, find earnings, attainment, and commission payment information faster than ever before.

Use Member Details to execute payments more efficiently. And, send your sellers to Home for Reps for current, forecasted, paid, and to-be-paid commission information to foster compensation ownership and motivation. 

To check these features out yourself, start a free 30-day trial with QuotaPath, or see it live in a guided demo with our team.

QuotaPath Director of Demand Generation Bret Lehnhof authored this blog post on adjusting SDR compensation for today’s technological landscape.

With the increased use of technology to identify target accounts and automate sales tasks, the role of an SDR (Sales Development Representative) has evolved. 

For instance, advancements in AI have automated many of the traditional roles of an SDR such as identifying potential leads, crafting personalized email copy, and even responding to emails and scheduling meetings. 

Still, SDRs remain a critical piece of your growth engine because the technology needs an orchestrator.

More importantly, businesses will always require human relationships. 

However, the introduction of AI and sales enablement technology have shifted the way we should think about compensating SDRs. 

Traditionally, SDRs have followed compensation plans that pay based primarily on booking meetings for account executives. That means for any lead that they set a meeting for with their account executive, they earn a bonus. Think $200 per demo set.  

But as automation has replaced some of the responsibilities that SDRs used to be in charge of, how can you re-imagine their compensation plans to fit today’s times better?

Why use an SDR compensation plan:

An SDR compensation plan is essential because it aligns incentives with the role’s evolving responsibilities, ensuring SDRs stay motivated and productive.

As automation takes over tasks like lead identification and email outreach, compensation should shift to reward higher-value contributions, such as engaging prospects in meaningful conversations, qualifying leads effectively, and driving pipeline growth.

Additionally, a well-structured plan helps retain top talent, encourage skill development, and ensure SDRs remain a valuable part of the sales process. Ultimately, SDR compensation should evolve to reflect the strategic, relationship-building aspects of the role that technology cannot replace.

Below are three things to consider when thinking through SDR compensation plans in the age of AI:

1. Keep your eye on the revenue

Even though AI has changed (and continues to change) the game, SDRs still need to drive revenue for the business. Therefore, compensation plans that incentivize your SDRs to drive revenue remain in full effect.

Focus on plans that reward your SDRs for booking demos and giving them a piece of the pie for when the leads they pass convert to customers. Adding a “Closed-Won Commission” component to a compensation plan drives urgency for the SDR to create a very human first impression and stand out from the AI crowd to build real relationships needed to win.

2. Reward technology adoption

AI and sales enablement tools are here to stay and are only going to improve. The SDR that stays on the frontline of tech advancements and creatively implements new practices will rise to the top.
Consider developing a SPIF that rewards the SDR with the most successful AI integration into their prospecting initiatives.

3. Incentivize efficiency

Automation has exponentially increased the speed at which an SDR can prospect into accounts. It’s also enabled SDRs to tackle an enormous amount of daily sales activities.

While tracking SDR activity levels is a leading performance indicator (view our sales funnel calculator), you should prioritize efficiency. An effective SDR compensation plan should consider sales opportunity conversion rates and how many of those opportunities move to qualified or closed-won stages. 

Reward the SDR that creates meaningful conversations with prospects that are ready to buy. Consider creating a SPIF for the SDR that has the shortest closed-won sales cycle. You could also SPIF for the SDR with the highest opportunity conversion rate.

How to Design an SDR Compensation Plan

Designing an effective SDR compensation plan requires aligning incentives with both business objectives and the evolving role of SDRs. Given the increasing use of AI and automation, compensation should go beyond just meetings booked and reflect SDRs’ contributions to pipeline growth and sales enablement.

Key considerations when structuring an SDR comp plan:

1. Balance Base Salary and Variable Pay: Traditional SDR compensation often follows a 60/40 or 70/30 split between base salary and variable earnings. However, the split may need adjustment based on how SDRs contribute beyond just setting meetings.
2. Incentivize Pipeline Impact, Not Just Meetings Booked: While demo bookings remain a core metric, consider rewarding SDRs for qualified opportunities that progress further in the funnel rather than just initial meetings.
3. Incorporate Multi-Touch Contribution Metrics: Since automation now plays a role in outreach, SDRs should be compensated for strategic engagement, such as nurturing high-value accounts, facilitating multi-channel outreach, or assisting with outbound personalization.
4. Set Clear, Attainable Goals: Compensation should be based on realistic quotas informed by historical performance, industry benchmarks, and the effectiveness of AI-assisted outreach.
5. Offer Bonuses for High-Quality Opportunities: Reward SDRs for deals that progress to later sales stages (e.g., opportunities that reach proposal or close-won status) rather than simply paying for booked demos.

By shifting the compensation model from a volume-based approach to a value-driven one, businesses can ensure SDRs remain motivated and focused on impactful sales activities rather than just chasing meeting quotas.

SDR Compensation Plan Examples

Depending on your business model, sales motion, and use of automation, here are a few SDR compensation plan structures to consider:

1. Traditional Meeting-Based Plan:
   • Base Salary: 60-70% of total comp
   • Variable Pay: Paid per demo set (e.g., $200 per completed demo)
   • Best for: High-volume outbound teams with lower ACV deals
2. Qualified Opportunity Plan:
   • Base Salary: 60-70% of total comp
   • Variable Pay: Compensation based on the number of qualified opportunities rather than just meetings booked (e.g., $500 per opportunity that reaches a defined pipeline stage)
   • Best for: Teams focused on pipeline quality rather than raw meeting volume
3. Revenue-Based Plan:
   • Base Salary: 50-60% of total comp
   • Variable Pay: SDRs earn a percentage of revenue from deals they sourced (e.g., 1-2% of closed-won revenue)
   • Best for: Organizations with longer sales cycles and higher ACV deals
4. Hybrid Compensation Plan:
   • Base Salary: 60-70% of total comp
   • Variable Pay: Mix of meeting bonuses, opportunity-based rewards, and revenue share
   • Best for: Businesses looking to balance activity metrics with sales impact

Each model should be tailored to reflect how SDRs drive pipeline growth in today’s AI-assisted sales environment. By rewarding strategic engagement instead of just raw activity, companies can create SDR compensation plans that motivate reps while adapting to modern sales strategies.

Final Thoughts

In summary, AI and sales automation are here to stay.

However, SDRs remain a crucial role in orchestrating the technology and providing human-to-human interaction necessary to drive revenue. 

As tech advances, so should the way we think about compensating our SDR teams. 

For additional resources to support the growth of your SDR team, check out the following blogs:

• 7 lessons we learned after building our first SDR team
• SDR compensation plans to consider for 2023
• How to set bonus and commission rates for SaaS SDRs

Ready to automate sales compensation management and commission tracking? Sign up for a free 30-day trial or schedule time with our team to learn more. 

The following blog shares four steps to increasing sales compensation equity at your organization.

Sales expert and advocate for women in sales Lori Richardson has nearly 30 years of experience working in tech sales.

The Founder of WOMEN Sales Pros, Harvard Business School Sales Coach, and Growth Strategist for Score More Sales, is a prolific leader in the space and has had a storied career. And, like other women leaders in sales, she’s also learned first-hand the pay discrepancies between men and women particularly in sales.

“Some people are just flat-out paid differently,” Lori said. “That happened to me. I found that my male counterparts were paid more, even though they had no more experience than me.” 

Lori’s experience dates back to her years climbing the sales leadership ladder more than two decades ago. Yet 2023 data confirms this remains a prominent issue in sales.

A recent report found that women earned 23% less in commission and salary than men. What’s more, men made nearly double the amount of commissions as women per sale according to their data. Analysts cited biases, differences in negotiation successes, and lack of growth opportunities as the leading reasons for these numbers.

We’ve also seen the number of comp plans within a sales organization lead to pay discrepancies for women and people of color. 

“If you have different compensation plans for people in the same role with the same title, on average, you end up paying women and people of color less,” said QuotaPath Chief of Staff Graham Collins. 

Inequitable territories also threaten fair earnings potential. 

This occurs when sales territories fail to evenly balance sales potential or opportunities across the team, making it harder for the reps in those territories to achieve their full on-target earnings (OTE). 

The same can be said for poor account scoring models that send the highest-ranked leads (the accounts most likely to close) to top performers. 

When you have inequitable lead distribution plus discrepancies across sales compensation plans, you create an environment at-risk of inequity. And when that happens, no one wins. It’s unfair to your employees. It’s bad for business. 

Your employees should be paid fairly, equally, and competitively. Not only because it’s the right thing to do, but because when you have compensation equity, you’re more likely to attract and retain top talent while improving morale and productivity amongst your team. 

“By ensuring employees are paid equitably, employers can increase efficiency, creativity, and productivity by helping to attract the best employees, reduce turnover and increase commitment to the organization,” said Cheryl Pinarchick, an attorney with Fisher Phillips in Boston (The Importance of Pay Equity).  

So, how can you as a business leader ensure your sales function operates under equitable circumstances?  

You can start by standardizing your compensation structures and ensuring your account scoring models and territory designs are set up to give your reps the same chance at success. We also suggest being open and upfront about your compensation packages with job candidates.  

Below, we explore ways in which you can increase sales compensation equity.

How to build sales compensation equity into your plans

The first principle of building an equitable sales compensation plan is to standardize it. Make sure that every person with the same role follows the same comp plan. 

“At QuotaPath, we have an Account Executive, an Account Executive II, and a Senior Account Executive role,” said Sr. Director of RevOps Ryan Milligan. 

He explained that each rep with the same title shares the same variable and base. When they earn a promotion to AE II or Senior AE, their base and variable pay increases.

“That should be public, and every rep should know and understand the varying levels of OTE for positions within the org.,” said Ryan. 

Next, your sales compensation plan should follow our three comp plan pillars. 

Every structure should be simple, fair, and logical. That means that reps understand how and when they earn commissions. If you can’t explain in less than 30 seconds or write it on a napkin, your reps won’t be able to either. 

Create compensation equity via fair territories and OTEs

For fairness, every rep should have the same shot at reaching their OTE. That means equally distributed territories. 

“Start by implementing round-robin lead distribution,” Ryan said. 

This will ensure reps inherit opportunities in an order one at a time, rotating as they come in. By doing so, opportunities spread out evenly across your team which fosters compensation equity. 

Additionally, your OTEs should actually be attainable. If your OTEs are unrealistic, you’ll lose your top performers quickly. To get a gauge on the health of your quota to OTE ratio, use our free OTE calculator. 

The last pillar, logical, ties more to your business strategy. Comp plans should follow your company’s targets and not the other way around. 

Align your structures to your financial goals so that reps put their efforts behind what matters most. If the key metric is net revenue retention, set up your comps plans so that your sales reps pursue accounts that are most likely to renew and see value in your solution — aka your ideal customer profile. This helps to spread compensation equity because you’ll steer all of your reps toward similar accounts with the greatest chances of closing. 

Ensure your account scoring model is equitable

Another way to create equity across your team is through your account scoring model. Similar to our suggestion of a round-robin demo distribution, accounts with the highest scores should also distribute evenly across your team.

In order to stay on top of this, you have to commit to tracking where accounts go. 

“I think the most important part about looking into the validity of your account scoring model is to accurately track account distribution across your team,” said Gradient Works Head of Growth Lily Youn Jaroszewski.

Doing so will help you avoid sending top accounts only to your top performers, and visa versa, which can frustrate reps, skew data, and mess with your team’s chances of success.

Be open with candidates regarding your compensation policy

Lastly, you can make sales compensation more equitable by being open and transparent with job seekers about your compensation policies. 

“The hiring company should provide the salary range and on-target earnings estimate first,” said Heather Foidart, Business Owner and Sales Coach.

Fortunately, we’ve seen an increase in companies sharing OTE, base pay, and even quota targets and sales activities within the actual job descriptions. 

This is good practice so that candidates are clear upfront on expectations. It also ensures that employers don’t pay sales candidates less if they find out the candidate’s salary requirements are lower than what the company had in mind.

Plus, leaders agree that it’s a red flag when an organization isn’t upfront about variable compensation packages and performance metrics.

“An employer should always be able to share the breakdown of the variable compensation plan,” said Heather. “Know the metrics: Average deal size, time to close, ramp time, win rates, % of the team hitting quota, etc. If a company has a “story” behind why they don’t have these metrics, it’s a red flag.”

Sales compensation plan best practices

We close with six additional best practices to build equitable sales compensation strategies:

Use a performance-based plan. A performance-based plan rewards employees based on their sales results. This type of plan is generally considered to be the most equitable, as it rewards employees for their hard work and results.

Set clear goals and expectations. Employees should know what they need to do optimize their earnings and what it will take to get their next promotion. Make sure your sales compensation plans and career ladders are clear, easy to understand, and accessible for your reps. 

Use a variety of metrics. Don’t just focus on sales volume. Consider other factors such as customer satisfaction, new accounts, and repeat business.

Regularly review your plan. Revie your sales compensation plan on a regular basis to ensure that it is still fair and equitable.

Consider using a third-party consultant to help you create your sales compensation plan. A consultant, or partner like QuotaPath, can help you to ensure that your plan is fair and equitable and that it meets the specific needs of your business.

Get feedback from your employees. Once you have created your sales compensation plan, collect feedback from your reps. Ask them if they think it is fair and equitable. 

For additional compensation plan resources, visit Compensation Hub . This library of comp plan templates allows you to adjust, customize, and model for your business. 

And, to extend compensation transparency across your organization, automate sales compensation management with QuotaPath. Sign up for a free 30-day trial or schedule time with our team to learn more.

After running sales commissions manually through spreadsheets, you’re ready to offload some work by recruiting the help of automation. 

Congratulations, you’ve made the right choice. 

While we respect the spreadsheet and its loyal fanbase of formula wizards, we also believe in working smarter, not harder. Why calculate and track commissions in a cell when you can leverage the power of technology to take that on for you?

That’s where commission payment software comes in.

With a growing list of sales compensation management platforms and four leaders in the space, where do you begin? To help, we built a thorough comparison list of the most widely adopted and top-performing sales commission platforms.

Read on for a comparison between QuotaPath, Spiff, CaptivateIQ, and Xactly. Want to jump right into QuotaPath and get a feel for yourself? Start a free 30-day trial here.

All platforms, in a nutshell

To help you get an idea of the best sales commission software, we surfaced what customers and prospects care about most when evaluating which platform to purchase. 

Tool accessibility and usability: The ease with which the platform allows you to create compensation plans and make changes or adjustments as you scale. 

Forecast earnings/attainment: Executive- and rep-level reporting on existing and forecasted revenue and earning potential tied to pipeline and quota attainment. 

ASC-606 Compliant: Ability to schedule, recognize and report commission expenses in compliance with ASC 606 regulations. 

Time-to-value: The time it takes for customers from the moment of purchase to realize the value of a sales incentive compensation platform.

Accuracy: Trust in the math and calculations.  

Integrations: Data connections that enable direct and real-time data flow from commissions’ source of truth.

Rep accountability: Views that provide clarity into sales compensation, progress toward goals, and when, what, and how commissions are paid. 

In-app communication: Collaboration and communication enabled within the commission tracking app to dispute, resolve, and keep records of commission payment discrepancies.

Support: Accessible, reliable, and helpful vendor support.

Pricing: Upfront pricing models, no minimum user limits, and no onboarding, implementation, or professional services fees.

Spiff vs. CaptivateIQ vs. Xactly vs. QuotaPath 

Reviews Comparison

To get an objective view of all four platforms, we checked out three independent review sites under the sales compensation software category. 

Pricing Comparison

In today’s market, buyers want (and should expect) to be able to find out pricing information without having to jump through hoops and speak to a sales rep or two.

That’s why QuotaPath proudly shares transparent pricing directly on our website. 

“Your website should answer almost all the questions a buyer might have, especially pricing,” said QuotaPath CEO and Co-Founder AJ Bruno.

If you visit Spiff’s, CaptivateIQ’s, and Xactly’s websites, you’ll find an absence of actual pricing info on pricing pages or missing pricing sections altogether. However, after some sleuthing, we were able to locate pricing for Spiff, CaptivateIQ, and Xactly for you. 

Check out the model below to see how they all compare: Spiff vs CaptivateIQ, CaptivateIQ vs Xactly, Spiff vs Xactly, and QuotaPath vs CaptivateIQ.

Which is the best platform?

The best sales commission software will largely depend on the size of your company, commission’s source of truth, and preference for setup.

For instance, scaling small to medium-sized tech companies will find the most value with a solution like QuotaPath’s. That’s because QuotaPath’s fast time to value (onboarding and implementations within 6 weeks), no minimum user limit, and guidance on compensation plan design are invaluable for fast-changing teams that need a helping hand in aligning their compensation strategies to their business goals. 

Those who run deals and earnings info through HubSpot, Salesforce, Copper, Pipedrive, Zoho, and Google Sheets, as well as invoicing systems such as Quickbooks, Maxio, and Stripe, will also benefit from QuotaPath’s 3-step data syncs and real-time updates. 

Meanwhile, large enterprises are a better fit for Spiff, CaptivateIQ, or Xactly. Plus, those platforms prefer that based on their minimum user requirements and lengthy implementation periods dedicated to carefully setting up large accounts. 

Pros of QuotaPath over Spiff, CaptivateIQ, and Xactly

Incentive compensation management software come in all shapes and sizes. 

What sets QuotaPath apart from the rest is our team, our solution’s ability to foster accountability and ownership over company-wide financial goals, and streamlined workflows that build operational efficiencies in your compensation management processes. 

Plus, we are the only commission tool with a free trial. 

The Team

Sales compensation is nuanced. 

Having a partner with a trusted commission management solution and a team that knows the ins and outs of comp design can play a critical role in rallying your team around your financial targets. 

QuotaPath’s team has evaluated thousands of sales comp plans. We share our knowledge with our communities and customers and act as advisors to steer teams toward simple, logical, and fair incentive structures.

We listen, understand, and empathize. Whether you’re in the front of the house, or the back of the house we’re here to help.

Our Customer Success team is the fastest in the biz, with less than 90-second response times. Our Account Managers ensure even your most complex comp plans run smoothly and accurately, and our Product team has their eyes and ears locked in on the customer to ensure our platform is evolving with your needs. 

Accountability and ownership

Department-wide understanding and alignment over your financial targets are paramount to the success of your business.

By collaborating with QuotaPath, you gain an advisor to align your compensation plans directly to your business metrics, such as annual recurring revenue (ARR), gross revenue retention (GRR), net revenue retention (NRR), etc.

When everyone knows what they’re working toward and how their efforts impact the bottom line, you’re setting your team and organization up for success.

Pair that with the commission tool itself, and you give all stakeholders visibility into real-time progress toward those goals as well as forecasted earnings and revenue. Account managers now have access to see how their most recent renewal improved GRR and how much they can expect to get paid on it.

What follows is accountability and ownership from the top down over progress and earnings. 

Operational efficiencies

We surveyed Finance, RevOps, and Sales leaders about their compensation management, and the biggest challenge they reported with their processes was that their sales comp models were too hard to execute and too time-consuming. 

QuotaPath creates operational efficiencies from comp plan design through commission payments. 

“When you scale a team, comp structures start to contain different elements,” said Katie Cooper,  Muck Rack, Senior Business Manager, Business and Data Operations. “QuotaPath offers the ability to take what you have in the system and build on it so that when you have a slightly tweaked plan or a new teammate, you can build a new plan and assign accordingly in three minutes versus an hour.”

By streamlining workflows from the moment you sign up for a free 30-day trial to hosting in-app communication to raise commission questions and resolve disputes, and by surfacing the most important commission-related tasks to those who run payouts, we’re making it easier to own, stay on top of, and run commissions.  

Need to get rep sign-off on a comp plan change? Use Plan Verification in QuotaPath to distribute new commission policies and collect rep sign-off.

Katie, for example, used to spend 2 to 3 hours manually sending mail-merged compensation and goal emails to every rep. Now, it takes 10 minutes.

Free app experience

When in doubt, don’t take our word for it. Play in the app yourself by signing up for a free trial. 

As the only commission tool with a free trial experience, QuotPath gives you the chance to integrate your CRM, map your existing comp plan, or test your current pipeline’s data with one of our customizable templates, and invite team members to your QuotaPath workspace.

What’s more, you can even run commission payouts. 

All for free and without having to enter credit card information. 

With QuotaPath:

• Provide reps and leadership with immediate insights into forecasted revenue 
• Monitor team-wide performance
• Pull up ARR in realtime
• Quickly design and build compensation plans within the platform
• Be ASC 606-compliant with commissions recognition and reporting
• Incentivize your reps
• Integrate your CRM

To learn more, chat with one of our teammates today.

Frequently Asked Questions

What is Spiff and what are its alternatives?

is a commission management software designed to automate and simplify the calculation and tracking of sales commissions. It integrates with CRMs, ERPs, and other financial systems to provide real-time visibility, ensuring accuracy and transparency for both sales teams and finance departments. Spiff is particularly popular among organizations that need a scalable, flexible solution for managing complex commission structures.

Alternatives to Spiff

Here are some notable alternatives to Spiff, often used for commission management and incentive tracking:

1. QuotaPath
   • Focused on sales commission tracking and forecasting, QuotaPath offers a user-friendly interface, seamless CRM integrations (like HubSpot and Salesforce), and features that tie commissions to pipeline performance.
2. CaptivateIQ
   • A platform that combines automated commission calculations with spreadsheet-like customization, ideal for companies with complex or unique compensation plans.
3. Xactly
   • A robust solution for incentive compensation management (ICM), offering features for automation, analytics, and compliance, catering to larger enterprises.
4. Performio
   • Designed for sales performance management, Performio provides insights, commission tracking, and customizable workflows for mid-sized to large organizations.
5. Everstage
   • A platform focusing on transparency and user experience, providing commission tracking and analytics for sales teams.

What is Xactly and what are its alternatives?

Xactly is a provider of cloud-based sales performance management (SPM) solutions, offering tools for incentive compensation management, revenue forecasting, and sales planning.  

Alternatives to Xactly:

When considering alternatives to Xactly, several platforms offer comparable features in sales performance and incentive compensation management:

1. CaptivateIQ: A flexible platform that combines automated commission calculations with spreadsheet-like customization, ideal for companies with complex or unique compensation plans. 
2. Varicent: Provides tools and information for sales reps, ensuring accuracy and efficiency. Managers and administrators can take control of their operations, eliminate surprises, and make better strategic choices for their variable incentive programs. 
3. Performio: Designed for sales performance management, Performio provides real-time insights, commission tracking, and customizable workflows for mid-sized to large organizations. 
4. QuotaPath: Focused on sales commission tracking and forecasting, QuotaPath offers a user-friendly interface, seamless CRM integrations (like HubSpot and Salesforce), and features that tie commissions to pipeline performance and forecasting.
5. Everstage: A platform focusing on transparency and user experience, providing commission tracking and analytics for sales teams. 

When evaluating these alternatives, consider factors such as the complexity of your compensation plans, integration capabilities with existing systems, scalability, user experience, and pricing to determine the best fit for your organization’s needs.

What is CaptivateIQ and what are its alternatives?

CaptivateIQ is a platform designed to automate and manage sales commission processes similar to spreadsheets. The platform integrates with various data sources, providing visibility into sales performance and ensuring compliance with industry standards. 

Alternatives to CaptivateIQ:

When considering alternatives to CaptivateIQ, several platforms offer comparable features in sales performance and incentive compensation management:

1. Xactly: A cloud-based solution for incentive compensation management, Xactly helps customers’ ICM processes with easy administration, advanced automation, and clear data visualizations.
2. Varicent: Provides tools and information for sales reps. Managers and administrators can take control of their operations, eliminate surprises, and make strategic choices for their variable incentive programs. 
3. Spiff: A platform that improves quality and provides reps with personalized, commission portals.
4. Performio: Designed for sales performance management, Performio provides insights, commission tracking, and customizable workflows for mid-sized to large organizations.
5. QuotaPath: Helps sales teams measure and model performance and commissions costs, track commissions, and increase earnings, with onboarding taking minutes, not months, to close more deals

What does calculating incentive pay look like without the help of a free commission tracking app?

Manual commission tracking can be a cumbersome, time-consuming, error-prone process that decreases sales team morale, productivity, and retention.

What’s more, your accounting team grows to dread the end of the sales cycle when they must deal with angry reps who blame them for commission miscalculations. We’ve had finance managers admit over calls that commission payouts were the “worst part” of their jobs because of the emotional aspect of commissions. 

Plus, keeping commission earnings and incentive pay locked in a spreadsheet prevents transparency, making it difficult for leadership — and reps — to gauge how they’re performing.  

A commission tracking app can reduce this friction by automating the entire process, eliminating inaccuracies, and democratizing the data with real-time updates. In turn, teams experience boosts in morale, time saved, and valuable visibility and insights into team and compensation strategy performance.

Integrating with a CRM to build trust around data

But with growing tech stacks, adding another platform may sound like a daunting task. 

That’s why QuotaPath integrates directly with deal data sources of truth, like CRMs such as HubSpot, Salesforce, and Close, and invoicing systems like Quickbooks and Stripe. 

A QuotaPath integration with your CRM does not impact CRM data and only involves 3 steps. Then you can map out your comp plan to immediately begin feeding deal data into QuotaPath.

It’ll give you peace of mind knowing the data is accurate. Take Katie Cooper of Muck Rack, for example.  

“When I’m reviewing commissions in QuotaPath, I’m not checking to see if they’re right in QuotaPath, I’m checking to see if the deals and fields in HubSpot are correct. Knowing that the data comes from HubSpot is a huge peace of mind,” said Katie“I can trust it.”

Integrating QuotaPath with your CRM also fosters good CRM hygiene. 

That’s because QuotaPath’s data depends on accurate CRM data. If reps want to know how much their pipeline is worth to them, then they have to keep their CRM data clean and up to date. That way, their forecasted earnings will accurately reflect what’s real in their pipe. Our Salesforce commission tracking integration works the same, by enabling you to automatically import deals from your Salesforce 

Our integrations: 

• Provide a single source of truth for both attainment and earnings, eliminating the need for a dual entry in multiple tools.
• Are simple and intuitive to setups, with no complicated logic or code needed to get connected.

As Dennis Dube of EverView said, “The ease to get up and running with QuotaPath was a big plus – that and QuotaPath’s real-time Salesforce integration.” 

And according to Dennis’s colleague, Ron Morgan, “Our comp plan was easily measured and easily viewed by our sellers in QuotaPath, which drove positive selling behaviors.” 

As a result, EverView achieved record sales in 3 months with QuotaPath and the best sales year in company history.

Options to track commissions without an app

Our preference is for you to sign up for our free commission tracking app experience, but we recognize not everyone is in a position to do so. For those not ready to commit to automation, how do you calculate incentives without a commission-tracking app?

Here are some options.

Excel sheets or Google Sheets

For small businesses with basic and simple commission structures, bulk spreadsheets will work just fine. But as your business grows or your compensation plans become more complex, keep in mind that:

• Any changes to incentive pay require manual updates.
• Every new deal, related bonus, or spiff that affects commission payouts also must be added manually.
• Bulk spreadsheets don’t carry over month-to-month, making it necessary to re-add any exceptions or modifications to a rep’s commissions each month.
• If you want to provide reps with individual commission statements, you’ll need to create them manually, deleting other reps’ info from the spreadsheet.
• Manual data input and adjustments increase the risk of incorrect commission checks.
• Since spreadsheet access is often permission-based, commission visibility will be tough to promote as reps will have to contact finance and accounting anytime they have a commission-related question.

Commission tracking template

Another option to track commissions without a commission tracking app is to borrow our free commission tracking template. You can download the template to see exactly how much your team earned with just four inputs.

Use the tabs within the template to add your commission rates and quota frequencies and deals, then look at the “Monthly Totals” tab to see your earnings. 

How to get started with QuotaPath

Let’s say you are ready to try a sales compensation management software. Try QuotaPath’s free commission tracking app by signing up for a 30-day free trial.

Your trial will allow you to:

1. Build your sales compensation plans.
2. Sync your CRM.
3. Invite team members.

To help get set up, leverage our Home feature. This dashboard will guide you through onboarding by directing you through the steps to get a plan completely up and running in QuotaPath. This includes creating your first plan from scratch or using a free comp plan template from our compensation plan template library, integrating your CRM, and inviting your team members.

The best part? Syncing your CRM or data source only takes 3 simple steps:

1. Select your integration.
2. Authenticate it.
3. Map it.

Then you’ll be ready to invite your team members and start automating incentive calculations with a free commission tracking app.

Best practices on how to get the fullest out of QuotaPath

To get the most out of QuotaPath, take the following actions:

• Log in regularly to get a pulse on team progress and attainment, total earnings, and to see what tasks are due.
  
• Use team leaderboards to help sales leaders identify coaching opportunities so they can be more strategic with their coaching and time.
  
• Include QuotaPath in your new sales hire onboarding to review compensation policies and show transparency around earnings.
  • That’s what our customer Katie does and talked about this in this case study, when she said, “A major game-changer for me is the ease in which I can onboard a new team member. Assigning a plan, quota, and rate in QuotaPath saves me about 30 minutes per employee.”
    
• Encourage reps to pull up QuotaPath daily so they know how close they are to reaching their next commission milestone and run “what if scenarios” using their forecasted data.
  • Joe of Blackthorn discussed this tactic in this case study. He said, “Our reps realized they could run scenarios and see how much they could earn from our monthly kickers.” This motivated Blackthorn’s reps to fully maximize the accelerators and the “what if” scenarios broke down how much they would need to book monthly to lock in an extra 2 percent per deal by the end of the year. This resulted in record-breaking sales following QuotaPath implementation.
    
• Distribute and collect rep signatures on compensation agreements using QuotaPath’s plan verification feature.
  • This shows that your reps grasp how they get paid and creates alignment and transparency across the comp planning process. When reps have a clear understanding of their comp plans and how they earn incentives, the plan motivates and empowers them.
    
• Collaborate and resolve deal discrepancies in-app by using deal flagging.
  • This feature provides reps with an easy, operational way to raise a payroll issue without needing to email or message anyone. So, when a sales rep spots an incorrect earnings amount, they can proactively report discrepancies instead of waiting to report an issue after receiving their paycheck.

Sign up for QP or learn more through a demo

Ready to check out our platform? Sign up for a commission tracking software free 30-day trial or schedule time with a QuotaPath team member today.

RevOps is growing fast. Really fast.

Since 2020, the number of RevOps tools and platforms has doubled, growing from about 500 solutions to over 1,000 in 2023, according to The State of RevOps 2023 by G2.

What’s more, Future Market Insights reported that the estimated market for RevOps platforms totaled just shy of $3 million in 2021. They predict that number to increase 5x by 2032 to $15 million.

But these numbers were published in 2022 and they already seem outdated.

Recommended reading: How to start a RevOps team

For instance, RevOps jobs increased by 300% in the last 18 months on LinkedIn. When a rise in a new role grows, a flood of technology typically follows. And despite economic conditions threatening buyer spend, RevOps leaders are still buying products.

We know this firsthand from the RevOps communities we’re a part of, such as RevOps Co-op and RevOps Alliance, partnering with RevOps professionals that run commissions through QuotaPath, and from watching our own RevOps team shop for technologies to make their jobs easier and more impactful. 

Additionally, we know that when they are buying, they’re often turning first to their peers and RevOps networks for recommendations. 

Like Brandon Smith, QuotaPath’s RevOps Manager. 

“The way that I buy is I get recommendations from people that have used a tool like it before,” said Brandon. “That’s step one.” 

So, to help fellow RevOps managers who are new to the role and building their first tech stack, or to those curious about what we use since we invested in RevOps early, we asked Brandon to shed some light. 

Below, Brandon shared what is core to QuotaPath’s RevOps tech stack, how he shops, and what he’s still on the hunt for. 

What are the core tools in your RevOps tech stack?

Brandon: I’ve bucketed our tools into the following: CRM, customer communications for inbound and outbound, marketing attribution and exclusively outbound customer communication, sales activity tracking and cadence building, prospecting management, calendar management, demo routing, compensation planning software and commissions, call transcription and insights, contract management, data analytics reporting, and workflow automation and integration.

Here are the tools we use for each one:

• CRM: Salesforce
• Customer communication: Intercom
• Marketing attribution and outbound customer communications: HubSpot
• Sales activity tracking and cadence building: Salesloft
• Prospecting management: Apollo, Clay, LinkedIn Sales Navigator, and Gradient Works
• Calendar management: Calendly
• Demo routing: Chili Piper
• Compensation planning software and commissions: QuotaPath
• Call transcription and insights: Chorus
• Contract management: Docusign
• Data visualization: Mode
• Workflow automation and integration: Zapier

What tool could you not live without? 

Brandon: In my role, I would say Zapier and Salesforce. I use Zapier a ton. It connects all of our tools that lack out-of-the-box integrations with each other. All of our notifications are powered through Zapier. 

Salesforce has the largest organizational impact. We’ve built so much within Salesforce that we point people to use. And Mode has been helpful on the data visualization side especially as we grow org-wide adoption. 

Our Sr. Director of RevOps, Ryan Milligan, would also say he couldn’t live without QuotaPath, since he used to run commissions manually. Now it only takes him about 10 minutes at the end of a commissions cycle. 

How do you decide when it’s time to shop? 

Brandon: We decide based on what the teams we support are telling us and by looking into if what they are asking for we already have and maybe they just don’t realize it. Then it’s figuring out if what we have can accomplish what they’re requesting. 

Also, if multiple teams are requesting the same thing, then it becomes a measure of business impact. The asks that come in under the premise of “we cannot do our jobs without this” take a higher priority than tools that might save our team a little bit of time. 

It’s all about the need and pain that the teams are experiencing. 

Describe your tech evaluation process. 

Brandon: I’ll give you a real-life example that we’re going through right now. We’re in the market for a ticketing solution, like a help desk. So I started by getting recommendations from people I know who have used a few of the tools we’re looking at.

Then I looked at G2 reviews by finding the top software in those G2 categories. I look at how the companies talk about themselves. For instance, if there’s a ticketing system that talks a lot about e-commerce, and we’re B2B software, I’m less interested. 

I don’t want to have to fit into your box — I want you to fit into what I am wanting. 

QuotaPath on G2

What is something buyers and sellers might not think about? 

Brandon: Sometimes you don’t necessarily want to completely replace a tool or system. A lot of these pieces of technology house helpful content or data, and if you replace those outright or consolidate them, you risk losing that information.

This just happened to me on a call with a vendor for this ticketing system. They said we would be completely replacing Intercom, and that’s not actually what we’re looking for. We need something to supplement it, not replace it. Because if we replace it outright we’ll lose out on customer experience. 

How do you measure the success of your RevOps tech stack? 

Brandon: This is a really manual process and it’s an easy one to neglect. Right now, it’s about being in the office and hearing people’s gripes about certain things. I do a lot more listening than people realize. When I hear a rep complain about something that I oversee, I make a mental note to look into it. Sometimes they’ll tell me directly that something isn’t working as it should and I’ll dig into it. 

We also look at usage and adoption. 

Lastly, what’s something you need in your RevOps tech stack that’s not out there yet? 

Brandon: I could use a tool that told me how reps felt about different tech stacks or tools. That would be super helpful. I’m putting together a survey for the reps to fill out in a few weeks on this topic, but if a tool could do this for me, that would make my life easier. 

***

Brandon, thank you for your time and your insights. 

For additional RevOps content, check out the following articles:

• What is a good rule of thumb for growing your RevOps team?
• How to start a RevOps team
• RevOps best practices
• 8 questions to diagnose a sales data quality issue

Curious about QuotaPath? Sign up for a free 30-day trial to connect your CRM, build your comp plan in the system, or borrow one of our templates and invite team members to immediately begin tracking commissions. 

This blog features executive compensation negotiation best practices from three women sales leaders from the professional sales community, Women in Sales, with which QuotaPath is a proud partner.

The gender pay gap remains steady, with women in full-time roles earning 83.7% of what men are paid — an inequity that increases even more for Black and Hispanic women. 

While 83.7% spans industries and roles, in sales alone women reported earning 23% less in commission and salary than men. That’s according to a report published earlier this year. Analysts have suggested that part of this pay gap falls to the biases women experience in sales, such as leaders underestimating their knowledge or seeing women as “weak.”

Another factor, however, involves how men and women negotiate a job offer. 

For a while, most reports and anecdotal evidence hinted that women were less likely to negotiate compensation. But the report showed that it wasn’t that women were holding back from negotiating. 

“Despite a similar number of women and men negotiating their salaries and commission rates, men were more successful at getting what they wanted,” the report states. 

Is this for lack of negotiation skills or because business leaders have an easier time saying “no” to women in sales?

We can’t answer that. We also can’t control the latter. But what we can help with is elevating the voices of women who have seen success with executive compensation negotiation in their careers to help others.

Below, Ashlee Horn, CEO of Horn Sales Coaching, Heather Foidart, Business Owner and Sales Coach, and Rebecca Bormann, Founder and CEO of Rebecca Bormann Consulting,  offered actionable advice you can immediately put into practice. 

Learn what to keep in mind when negotiating, how to prioritize and communicate non-negotiables, how to ask for more, and steps to strengthen your skills. 

Before reading our Q&A below, first meet our leaders:

• Ashlee Horn, CEO, Horn Sales Coaching, and former Global VP of Revenue at Toptal and Regional VP at Gartner. 
• Heather Foidart, Business Owner and Sales Coach, and former Strategic Advisor at Coconut Software and VP of Sales at Shmoop.
• Rebecca Bormann, Founder and CEO of Rebecca Bormann Consulting, Advisory Board Member at Boss Babe Network, and former Managing Director of Sales and Services at Bell Techlogix, Inc. 

Thank you all for taking the time to answer our questions and share your expertise.

Let’s start with how to counteroffer salary. What are some salary negotiation tips?

Ashlee: Early in my career, I was advised to keep a running list of my accomplishments always up to date. This allowed me to easily pull together a business case during the budgeting season to request a raise. It can be hard to remember all of the things you’ve done over the course of a year so waiting until the EoY review process will dilute the quality of your business case. Keeping a live list increases the volume and quality of data points you’ll have to draw on for a raise.

Heather: When you join an organization, you have the most leverage to negotiate your salary. Ensure you’re maximizing this opportunity and aligning with salary expectations at every interview process step. If a salary range was provided and you know your expectation is at the top end, be explicit about that early and often.

Rebecca:  Be prepared with your past performance documents, competitive salary and compensation information, and the value you bring to the organization.

What are 3 things to keep in mind when negotiating Sales executive compensation packages?

Rebecca: 

1. The first offer is very seldom the best and final offer.
   
2. Determine your minimum prior to engaging in compensation package negotiations.
   
3. Consider benefits beyond financial like flexible work schedule, the ability to work remotely, stocks or stake in the company, non-compete requirements, outreach/marketing/training, and professional development budgets.

Heather:

1. Ask for the compensation range and on-target earnings upfront. The hiring company should provide the salary range and on-target earnings estimate first before you share your expectations.

2. Look beyond just monetary compensation and consider what’s most important to you. Perhaps it’s a flexible schedule, a 4-day work week, or remote or hybrid work. Other factors to consider are benefits like 401k matching and health insurance. Sometimes, you can negotiate to waive the waiting period before you’re eligible for insurance. Or negotiate a higher 401k match. 

3. Equity. While it can be lucrative to have equity in early-stage companies, keep in mind that up to 90% of startups fail. I never recommend accepting less money in exchange for equity or working for commissions only. 

Ashlee:

1. Scalability of the compensation package over the long term. Example: In Sales, it is common to receive a percentage of business unit growth commission or bonus. You should ensure that the plan is designed to scale.

2. Entry salary is key. Your future earning potential at the organization will be determined by your salary on Day 1. Most organizations have an upper limit on the percentage of annual raises each year, meaning you are unlikely to see much more than a 5% annual merit increase even with a stellar performance. 

3. Incentive-based packages or recurring bonuses should be clearly and quantifiably defined. I’ve seen organizations that provide a bonus to increase the overall OTE and attract elite talent in the marketplace and then use qualitative, changing metrics making the attainment of an MBO or bonus nearly impossible.

Throughout your career, what have been some of your must-haves? How did you communicate these?

Heather: I value flexibility in the workplace and paid time off for my passion in life, traveling. I am always upfront with my employers about my PTO expectations. When environments say “unlimited PTO”, I recommend negotiating an explicit amount of time you would like to take annually.  When I travel, I fully unplug and always ensure my leaders are on board and aligned with this non-negotiable. 

Ashlee: Base salary — especially in sales organizations that tend to entice talent with a large OTE number. 

When you are new to an organization, there are many unknowns: customer perception, product-market fit, number of open roles, etc. Many of these should be teased out as you assess an opportunity but you won’t be able to learn everything. While successful sales leaders tend to be incredibly confident in their abilities to succeed, they also need to protect themselves from circumstances outside of their control. 

It takes time to hire great talent and drive change when you are new to a role. You could lose 30% of your OTE because it takes you two quarters to assess and upgrade the talent on your team, base salary negotiation gives you the opportunity to build for the long term while still improving short-term results which is what an organization should be looking for in a sales executive.

Rebecca: My non-negotiables include base salary, uncapped commissions, equity, and inclusive work environment and culture, the ability for a career path and professional development, generous PTO, and the ability to work remotely with a flexible schedule.

Transparency is key and my best practice is to share the must-haves upfront and also to ask and understand the organization’s must-haves as early in the interview process as possible.

What are some red flags candidates should be on alert for during the negotiation process? 

Heather: An employer should always be able to share the breakdown of the variable compensation plan. Know the metrics: Average deal size, time to close, ramp time, win rates, % of the team hitting quota, etc. If a company has a “story” behind why they don’t have these metrics, it’s a red flag. Also, make a plan. If your quota is $1M, the average deal size is $50k, and the win rate is 25%, you would need to close 20 deals per year (with 80 opportunities in the pipeline). 

Rebecca: If the organization is not willing to discuss compensation packages upfront. Other red flags include a lack of diversity in the organization, especially at leadership levels, and an unwillingness to allow you to talk to peers or teammates during the interview process.

What steps can leaders take to strengthen their executive compensation negotiation skills? 

Ashlee: Be intentional in your negotiation. I’ve seen many reps especially women, negotiate with me simply because they read that they should. They have not prepared a business case nor do they come to the table with a clear ask, they seek more. This is unproductive. Know your numbers, and your contribution to the business, and articulate the return expected if the organization were to continue to invest in you. 

Ask ONCE for what you want. In one of the worse botched negotiations I’ve seen the candidate asked for two specific things. I fought hard as I believed in the candidate and I was able to get executive approval for those terms. Recruiting went back pleased to share good news and the candidate asked for more. I was unwilling to request more a second time, so I pulled the offer. It became apparent the candidate was going to continue to see what was possible, which reeked of low integrity. She lost credibility with me and I lost confidence in her value to the team.

Help your leader advocate for you. Write a clear business case outlining your role in high-impact projects, revenue contribution, and other accolades that lead you to believe you deserve further investment.

Be specific in your ask. Do your market research. Avoid comparing yourself to others internally, it is a poor look and leads to team disruption. It does not benefit you or anyone else. Have a % increase request or a specific dollar amount you’d like to see. Providing the other side with a few options makes it easier for them to find a creative solution that will leave you both happy.

Heather: Hire a coach! I help women gain confidence and navigate the hiring and compensation conversations. We role-play, discuss those red and green flags, and work on positioning tactics.  Negotiations don’t have to feel anxiety-inducing.  

If you approach negotiation calmly and feel prepared for the conversation, you can successfully negotiate more. The fun part is knowing what “more” is for you, money, flexibility, time off, etc.  

Rebecca: I recommend attending workshops or professional development sessions around negotiation skills and best practices. I see masterminds and workshops popping up on this topic more and more in the last couple of years. Additionally, it’s a great topic to discuss and ask for advice from your mentors and sponsors.

***

Thank you again to Ashlee, Heather, and Rebecca for their thoughts on executive compensation negotiation. We connected with them through Women in Sales, a professional community focused on elevating, empowering, and promoting women within the sales profession, which we’re a proud partner of.

For additional support with sales compensation management, from design through tracking and payment, learn more about QuotaPath by scheduling time with our team. 

A sales incentive program should motivate sales reps to meet or exceed their sales goals with cash and non-cash incentive rewards. This method gives salespeople rewards and recognition in addition to their sales compensation plan.

Sales incentives not only motivate sales reps to surpass their goals, but they also drive greater revenue, boost rep retention, and act as a competitive advantage to attract and recruit top talent.

Just how beneficial is a solid sales incentive program? Check out these study findings:

• Properly constructed incentive programs can increase performance by as much as 44 percent.
• After money, recognition is the second most important sales rep motivator according to Hubspot’s Sales Strategy & Trends Report.
• According to a survey conducted by the Society for Human Resource Management (SHRM), 68 percent of HR professionals agreed that employee recognition has a positive impact on retention.
• In the same SHRM survey, 56 percent of HR professionals said employee recognition programs also help with recruitment.
• An Incentive Research Foundation survey found that 60% of top-performing tech companies strongly agree incentive and recognition programs are effective recruitment tools, but only 25% of average-performing companies agreed.

Now that you know the value of well-designed sales incentive programs, let’s walk through some key elements you need to know to create your own effective strategy.

What are the types of incentive programs?

There are five types of sales incentives including role-specific, presales, split incentives, analytics-based, and omnichannel. The approaches you choose for your sales incentive program depend on your sales process and what behaviors you wish to motivate your sales reps to adopt. 

Let’s review these different types of sales incentives.

1. Role-specific sales incentives

Role-specific incentives are created based on individual roles and responsibilities. This approach enables you to acknowledge reps based on their job function.

For example, a sales manager has different duties than a business development rep (BDR) who prospects and identifies leads. You can reward a sales manager based on their results against the requirements of their position. And, the same is true for the BDR.

2. Presales incentives

Presales incentives reward salespeople at different stages of the sales process before closing a deal. 

For teams with longer sales cycles, more touchpoints, and buying committee members, this model keeps reps motivated throughout the process by rewarding them in the short term and at the close.

In lieu of offering only a larger incentive once the rep secures the deal, this approach keeps reps focused and motivated throughout the entire deal cycle. 

For example, you could give reps incentives after completing specific activities like scheduling meetings with prospects or running a sales demo, and upon contract signature. 

3. Split sales incentives

Adding split incentives to your sales incentive program is a great way to reward sales reps working together on the same deal or project. 

This approach allows you to split the incentive between the salespeople when the deal closes or the project ends. You can designate an even split between everyone involved or specify rules for split calculations.

For example, if two sales reps collaborate to close a large deal, you can reward them equally or based on their specific roles throughout the sales cycle. We see this model commonly implemented for sales engineers.

This model ensures all involved team members receive compensation for their work. Plus, it encourages communication and collaboration between teams by rewarding each party. 

One thing to note, when incorporating a shared commission structure into your sales incentive program, create the incentive structure and expectations to avoid misunderstandings when it’s time to distribute payouts.

4. Analytics-based sales incentives

All businesses analyze data to make accurate sales forecasts, set realistic goals, and create an ideal sales cycle. 

Analytics-based sales incentives reward reps based on their behaviors that align with the best practices gathered from data.

For example, if data from prior years indicate that achieving designated revenue goals requires a sales cycle length of a specific number of days, sales reps earn rewards or bonuses when they close deals within that timeframe.

5. Omnichannel sales incentives

Finally, the last type of program is omnichannel sales incentives. 

With buyers embracing a digital-first approach to the buying process, salespeople often interact with prospects online and over the phone before directly engaging with them. 

And, depending on the specific product or sales process, it’s possible for a prospect to sign up for a free trial or purchase online without a rep’s assistance.

Adding omnichannel sales incentives to your sales incentive program rewards reps for the support and value they provide to prospects–even if they aren’t directly involved when the buyer makes their purchase.

You can connect a closed deal to a rep by tracking who first contacted a lead via email or when a buyer made their purchase following a product demo.

Best sales incentive plans

Knowing the types of sales incentives is only one aspect of creating a sales incentive program. You must also understand what key elements will ensure your incentive program is successful.

The best sales incentive plans share the following common characteristics:

• Drive the right selling behaviors
• Motivate reps
• Reward overperformance
• Align with business goals and metrics for the quarter or the year

Keep these in mind when designing your sales incentive plans based on what you want to achieve as well as your sales reps’ preferences.

To get started, here are some of the best sales incentive plan ideas to inspire your sales team to greater achievements:

1. Monetary rewards

A popular and easy way to motivate sales reps is by offering cash incentives. These might include:

• Commissions: Give reps a percentage of each new sale in addition to their regular earnings.
• Bonuses: Reward salespeople with extra money as they meet or exceed quota to motivate them to reach higher.
• Pay raises: Periodic salary increases for your top performers are a way to display appreciation for their consistent overachievement. It’s also a way to show other team members that you reward success in your organization. Using sales leaderboards ensures transparency while rewarding sales leaders.

But one size does not fit all when it comes to incentives. Oftentimes, sales reps are motivated to work hard for other rewards and recognition.

So, what other sales incentive options are effective?

Additional reading: The psychology of compensation:  How to keep reps motivated

2. Physical items

Non-cash incentives can be more powerful motivators than cash prizes if the reward is appealing to your sales reps. So, you need to know your audience or get to know what they like so they’ll be motivated to work for the designated prize.

Physical items like tech gadgets, coffee brewers, or sporting goods can inspire your sales team members and drive them to meet or exceed their goals. At QuotaPath, we even have a WWE championship belt that gets passed around to the top seller.

Plus, physical rewards act as a future reminder of why they were rewarded and evoke positive memories of the winning experience.

3. Extra paid time off (PTO)

A popular non-cash sales incentive is additional vacation time. Sales is hard and can be very stressful. So, giving reps extra PTO to decompress promotes work-life balance, boosts mental health, and shows that your company cares.

Offering PTO as a sales incentive may inspire your reps to work harder, plus they’ll be rested when they return from their holiday.

4. Self or professional development courses

Access to upskilling is a sought-after employee benefit and a powerful employment attraction tool, according to a Gallup study. So, it makes sense to offer additional development opportunities as an incentive.

Providing these types of rewards in your sales incentive program helps reps advance their careers, improve skills and performance, and increase productivity.

Plus, you’re likely to boost sales rep retention by offering development courses as an incentive. According to a Talent LMS study, 76 percent of employees are more likely to stay with a company that provides continuous training, while 66 percent say it improves their company loyalty.

Professional development incentives you might offer include:

• Sessions with a professional sales coach
• Registration for an upcoming sales conference
• Advanced sales technique courses
• Workshops or guides to learn the best way to use sales tech to streamline work processes or to learn ways to improve their business writing skills

Also, some personal development options to consider as incentives are:

• Cooking classes
• Fitness memberships
• Art classes
• Online courses of the reward recipient’s choosing

5. Public recognition

Gallup research shows that recognition is a desirable reward that boosts employee well-being, engagement, and a sense of belonging while increasing productivity.

So acknowledging hard-working sales reps who consistently meet and exceed their sales targets is a win-win. The salesperson receives the reward and knows that they are appreciated. Plus, you increase the odds of retaining this top talent and inspiring them to continue their hard work.

Some examples of ways to offer public recognition as an incentive are:

• Inviting them to attend a special event with the company’s CEO
• Honoring them with an announcement on the company’s Slack channel
• Giving them bragging rights like salesperson of the month or year
• Acknowledging them in front of the entire team

6. Gift cards

Personalized gift cards can acknowledge sales reps and give them an opportunity to splurge on special items they’ve been wanting to buy.

This is why it’s essential to know your sales team members’ preferences so the reward you offer motivates them effectively.

Some gift card ideas to consider are a gift card for an exclusive restaurant, a subscription box, and a gaming certificate if you have gamers on your team.

7. Spinning the prize wheel

If you find pinpointing one reward challenging, consider putting a variety of options on a wheel so reps can spin to see what their reward is.

Spinning the wheel for your incentive adds an element of surprise and excitement to the experience. Plus, being the one who gets the opportunity to spin the wheel enhances the recognition element of the reward.

8. Activities and entertainment

Entertainment incentives are good motivators because they give your sales reps the things they’d love to do but aren’t necessarily willing to splurge on.

You don’t have to break the incentive budget to offer these rewards. They can range in value depending on how much you want to spend. For example, some higher-cost incentives might be front-row concert tickets, a romantic dinner for two, or tickets to the big game. And some other options include:

• Rock climbing
• Movie passes
• Bungee jumping
• Zipline
• Escape rooms
• Travel incentives

9. Office upgrades

Boost rep productivity by offering upgrades to their office as part of your sales incentive plan.

This is especially popular with the rise in remote and hybrid sales teams where each person has set up their own home office, possibly on a shoestring budget.

Examples of office upgrade incentives include:

• High-quality office chair
• Dual-monitor system
• Lighting or other office accessories
• Standing workstation
• Noise-canceling headphones

10. Allow reps to select their own reward

If your sales team consists of various types of personalities with diverse tastes, hobbies, preferences, and needs, it may be easier to allow them to choose their own incentives.

In this case, you can designate a budgetary limit for the reward that motivates each individual rep. Then encourage your reps to envision what they would select if they won at the beginning of the incentive period to motivate them to work harder.

Sales incentive structuring

Now for actually structuring your sales incentive packages.

Follow these tips as you create your incentive program to increase its effectiveness at the business and rep levels. 

1. Include all comp plan stakeholders from the beginning

Streamline the creation of your sales incentive program by involving all affected departments as you initiate the planning process. These vary based on your organization’s structure and include functions such as:

• Human Resources (HR)
• Sales Compensation Analysts and Admins
• Finance
• Sales Operations
• Senior Sales Leadership
• Legal

2. Review historical sales data for possibilities

Analyzing previous years’ sales data reveals seasonal sales trends. Once identified, commonly slow periods are candidates for incentives like SPIFs to help remedy these shortfalls. If you don’t have previous historical data, use conservative numbers and leverage any research you can find in your market and industry. 

3. Include non-monetary incentives

Although everyone needs money, it very rarely is the sole motivator.  Average and lower-performing sales reps may be more motivated to improve by non-cash incentives. 

4. Create role-based incentives

Customization is essential to the success of your overall comp plan, so it makes sense to incorporate role-based incentives. This enables you to drive specific role-specific behaviors to further boost sales and revenue results to meet business goals.

Your customer journey and sales process will help you determine which behaviors contribute the most value to customers while improving sales.

5. Allocate funds for short-term incentives

Historical data can reveal consistent trends, but short of having a crystal ball, it’s nearly impossible to anticipate all challenging sales periods. That’s why it’s advisable to reserve at least 3-5% of your total incentives budget for SPIFs, short-term bonuses, and accelerators to help close the gap during those times.

Additional reading: How to set up a successful sales SPIF

6. Incorporate some team incentives

Including team incentives or competitions can be fun, increase collaboration across the sales team and create healthy internal competition while boosting goal achievement. Competitive options include pitting territories, verticals, or small groups against one another to grow sales.

Group incentives encourage cross-departmental relationships and teamwork. They are especially effective when combined with SPIFs to hit goals.

7. Add fun incentives

The addition of fun or unexpected incentives injects some excitement into your plan and can be quite motivating. Some examples of fun sales incentives are raffles, randomly selected lottery numbers, or grab-bag-style prize giveaways. These can be very budget-friendly while energizing reps to participate.

Other fun bonuses include group team-building activities like golf, paintball, and dinner or happy hour after work.

8. Rank your incentive plan against the industry average

Make sure your sales incentive plan is realistic and attainable to ensure the likelihood that it will motivate your sales reps.  Gauging its appeal against your industry’s average incentive plan and then exceeding it as cost-efficiently as possible is advisable. This helps boost rep retention and gives you a competitive hiring advantage.

Resource: 2023 Compensation Guide (Betts Recruiting)

9. Complete a compensation risk analysis

Sales compensation is complex, so you can’t be too careful when creating a sales incentive program. Proactively review the practices and rules relating to your program to identify any potential risks to the organization before implementing it.

10. Get sales rep input

Most sales reps want a personalized incentive plan. Although this may sound like an impossible task for large organizations, it’s important to make the effort by requesting rep feedback. This helps involve reps in the process and will improve rep buy-in. 

11. Confirm that your selected incentives will promote the right behavior

The goal of any sales incentive program is to encourage behaviors to achieve business goals such as more leads, revenue, or profits. So, it’s essential to ensure that you are choosing incentives that will motivate your sales reps appropriately.

12. Fine-tune your sales incentive plan

Creating a sales incentive plan is not a set-it-and-forget-it process. It’s likely you won’t get it 100% right on the first try.

It’s best to get started, then analyze your results, adjust accordingly, and test different elements to see what is most effective.

Some variables to experiment with include:

• Payment amounts or multipliers
• Payout triggers
• Points awarded per sales dollar
• Timing of reward (Each time? Quarterly? Yearly? At milestones?)
• Form of reward (points, cash, trip, etc)
• Segmentation methods such as by vertical, product, or territory
• Team-based goals
• How much you pay
• Activity or behavior-motivated elements
• Long-term activities and behaviors vs. payouts only for transactional sales

Additional reading: How to assess your comp plan’s success

13. Clearly communicate the sales incentive plan

It’s essential to clearly explain your sales incentive plan to sales leadership and the sales team. 

Otherwise, you’ve wasted valuable time and effort designing your plan.

No matter how wonderful the plan might be, it won’t motivate sales reps if they don’t understand the sales incentive plan.

It’s essential that salespeople understand how they can earn more or win rewards on the new plan. So present the comp plan effectively to inspire your desired behaviors and hit your targets.

Sales incentive program management

Next, you need to think about how you will operationalize sales incentive program management.

Sales incentive program management is the use of supplemental rewards in addition to the standard compensation structure to drive better business outcomes. This strategy accomplishes this by more closely aligning sales rep behavior with the company’s goals.

Incentives include things like:

• SPIFs: Short-term incentives designed to motivate sales reps to focus on specific activities, like selling a particular product or service or targeting a designated customer segment.
• Bonuses: Monetary rewards in addition to commissions, often awarded for meeting certain goals, such as attaining a sales quota or booking a deal with a new customer.
• Commissions: The most common type of sales incentive program, paying salespeople a percentage of the sales they make based on the specific compensation plan.
• Prizes: Gifts awarded for completing specific activities or exceeding a designated target. These include things like gift cards, dinner for two, and movie tickets.
• Awards: A trip or other major reward given to top-performing salespeople who meet specific criteria.
• Recognition: Public acknowledgment of sales reps exceeding expectations. Recognition can be given in ways such as leaderboards, awarding a trophy, or a simple announcement in front of the team or a broader audience.

A properly managed sales incentive program motivates sales reps to exceed their goals, boosts revenue, increases sales rep retention, and provides your organization with a competitive hiring advantage.

Sales incentive software

When it comes to calculating sales incentives, many companies still calculate commission in Excel. This may be effective if your organization employs less than 5 salespeople.

But as teams increase in size, and add layers of commission tiers and streams, a spreadsheet can become cumbersome to manage. Not only can the use of a spreadsheet become a major time suck, but it can also be a particularly error-prone process that can lead to an incorrect commission payout.

So, why not automate it with a sales incentive compensation platform like QuotaPath? Our commission tracker app  gives you and your organization:

• Transparency so sales reps understand their compensation plan and can track and forecast progress toward goal attainment.
• Source of truth for earnings to minimize earnings disagreements and discrepancies
• Helps Finance predict future revenue and retention performance by having historical data on how compensation plans impacted past performance
• Enables reps to see how they’re tracking toward their goal and enables them to translate their sales pipeline to actual forecasted earnings
• Operationalizes sales compensation

Ready to see what it’s like to automate your sales incentive plan calculations? Start a free trial or schedule time with a QuotaPath team member.

FAQ:

What are the best practices to sales incentive planning?

Align incentives with company goals. Sales incentives should be designed to motivate salespeople to achieve the company’s overall goals. For example, if the company’s goal is to increase revenue, then the incentive plan should reward salespeople for selling more products or services.

Make incentives fair and equitable. Salespeople should be rewarded fairly for their efforts. The incentive plan should be designed to reward all salespeople, regardless of their experience or territory.

Keep incentives simple. The incentive plan should be easy to understand and administer. Salespeople should be able to easily calculate their potential earnings under the plan.

Test the plans. Run last year’s numbers through this year’s proposal. What breaks? Are you overpaying or underpaying? You should also run this year’s financial model’s revenue assumptions on the highest commission rate as well as the lowers. Read this blog for additional ways to pressure test your compensation plan.

Introduce comp plans in a timely manner. That means communicating the plans to your sales teams at the start of the year, like at your annual sales kickoff. Any changes thereafter should also follow an example compensation communication plan so that reps and leadership fully understand the meaning behind the changes and how the company will help support them achieve their goals.

 Monitor the results of the incentive plan and make adjustments as needed. The incentive plan should be evaluated on a regular basis to ensure that it is meeting its goals. If the plan fails to meet its goals, then adjustments should be made.

How can you calculate incentives for sales?

There are a few different ways to calculate incentives for sales. The most common method involves applying a percentage of the sales. For example, if a salesperson sells $10,000 worth of product, they may receive a commission of 10%, or $1,000. Another method is to apply a single rate bonus or a flat fee. For example, a salesperson may receive compensation of $500 on every new deal they sell. This of course assumes that the effective rate of pay for the rep is within a reasonable range of the contract value.

You could also combine the two by offering both a commission percentage and a single-rate bonus. For example, a salesperson may receive a commission of 5% of their sales and a milestone bonus of a flat $1,000 after hitting a predetermined goal, such as selling $50,000 in new revenue.

As far as systems in place for calculating incentives in sales, most companies manually track and calculate seller earnings via spreadsheets. For smaller organizations with less than 5 reps, this works great. But as teams grow and add complexities to their compensation structures (monthly SPIFs, different commission rates for different products, and more), a spreadsheet will become tough to maintain. If that’s the case, consider automating commission tracking with QuotaPath.

 Skip a demo and try QuotaPath out for yourself over a free 30-day trial.

What are some of the most commonly used sales incentive programs?

There are many different types of sales incentive programs, but some of the most common include:

 Commissions: This is the most common type of sales incentive program. It works by paying salespeople a percentage of the sales they make. For examples of a sales incentive plan template, check out Single Rate Commission, Single Rate Commission with Contract Term Multiplier, and Commission with Multi-Year Accelerators.

 Bonuses: Bonuses are typically paid out in addition to commissions, and they are often given for meeting certain goals, such as hitting a sales quota or bringing in a new customer. For bonus-based compensation plan templates, check out Multiple Rate Bonus (Revenue), Milestone Bonus, and Single Rate Bonus (Revenue).

For activity-based bonus comp plans for biz development, use these SDR commission planning templates Qualified Opportunity Bonus and Demos Completed Bonus.

 SPIFs: Spiffs are short-term incentives that are designed to motivate salespeople to focus on specific activities, such as selling a new product or service or targeting a specific customer segment.

 Contests: Contests are a great way to create excitement and generate enthusiasm among salespeople. They can be based on individual performance, team performance, or even company-wide goals.

Other incentives: Other types of sales incentive programs include travel awards, merchandise, national park passes, and charitable donations. The best type of incentive program for your company will depend on your specific goals and objectives.

 When designing a sales incentive program, it is important to consider the following factors:

• Your company’s goals: What are you trying to achieve with your sales incentive program? Are you trying to increase sales, improve customer satisfaction, or boost employee morale?
• Your salespeople: What motivates your salespeople? What are their needs and wants?
•  Your budget: How much money are you willing to spend on your sales incentive program?

By considering these factors, you can design a sales incentive program that will be effective and affordable.

Which companies are implementing the best incentive programs?

An employee incentive program is a type of performance management tool that rewards employees for meeting or exceeding certain goals. Incentive programs can be used to motivate employees to improve their performance, increase productivity, or achieve specific business objectives.

 There are many different types of employee incentive programs, but some of the most common include:

Commissions: Commissions are a type of incentive program that pays employees a percentage of the sales they make.

Bonuses: Bonuses are a type of incentive program that pays employees a lump sum of money for meeting or exceeding certain goals.

Stock options: Stock options are a type of incentive program that gives employees the right to buy shares of the company’s stock at a discounted price.

Tuition reimbursement: Tuition reimbursement is a type of incentive program that pays employees for taking classes to improve their skills.

Flexible work arrangements: Flexible work arrangements are a type of incentive program that allows employees to work from home, set their own hours, or take breaks throughout the day.

In today’s working environment, more companies than not offer employee incentive programs. Notable ones that have been widely praised include:

 Zappos: Zappos is an online retailer that offers a variety of employee incentive programs, including commissions, bonuses, and tuition reimbursement.

 Salesforce: Salesforce is a cloud-based software company that offers a variety of employee incentive programs, including commissions, bonuses, and stock options.

 Netflix: Netflix is a streaming media company that offers a variety of employee incentive programs, including bonuses, stock options, and flexible work arrangements.

Employee incentive programs can be a valuable tool for businesses of all sizes. By designing a program that is tailored to their specific goals and objectives, businesses can motivate their employees to achieve great things.

Your business development team might be the most entry-level folks on your team. 

Yet, they set the first impressions of your organization to prospects while tasked with building out your pipeline with quality leads. These responsibilities, driven by your business development incentive structure, are crucial to the growth and success of your go-to-market strategy. 

That’s why you have to carefully set your business development commission structure to ensure your reps focus on the right accounts, exercise quality control, and are competitive with industry and regional compensation packages.

In this blog, we’ll review the basics of business development compensation, how to build your first plan or modify an existing one, and offer plan templates to inform your next comp design. 

Business development compensation: The basics

First, what is business development?

Business development involves the sales process of identifying, qualifying, and closing new business opportunities. It plays a critical function for any organization that wants to grow and succeed. The roles and responsibilities may change depending on the size and stage of the organization.

For instance, a person in business development at a startup or early-stage company might be an experienced leader. This was the case at Katy Stover’s talent development startup, HigherPeople. Her first sales hire, a Head of Business Development, came to her with a decade of experience to build a sales motion and GTM strategy while actively prospecting and closing deals himself. We wrote a blog that included aspects of his business development incentive structure. 

Meanwhile, here at QuotaPath, our business development representative joined us with a year of selling experience in his first software-as-a-service (SaaS) role. His responsibilities include outbound prospecting, following up on inbound leads, and qualifying opportunities before handing them off to our account executives (AE). His commission structure, as a result, varies quite a bit from the business development seller at HigherPeople. 

So, what is a business development representative? A business development representative (BDR) is a sales professional responsible for generating new business opportunities for a company. We often interchange BDR with sales development representatives (SDR) and market development representatives (MDR). 

BDRs typically work by identifying potential customers, qualifying their interests, and then setting up meetings with sales representatives. They may also be responsible for building relationships with potential customers and providing them with information about the company’s products or services.

When should you add a BDR team?

Not every company has a team of business development reps. 

For instance, smaller companies may not have the resources to support a dedicated BDR team. If that’s the case, the responsibilities usually tied to BDRs fall under Sales and Marketing. 

The industry also plays a role. Some industries are more competitive than others, and companies in these industries may need a dedicated business development team to compete effectively. Companies in the technology industry, for instance, often have dedicated business development teams to help them find new customers and partners.

A company’s strategy also may impact whether or not to have a BDR team. For example, a company that is focused on organic growth may not need a dedicated business development team.

So, how do you know when to start a BDR team?

Our Director of Demand Generation Bret Lehnhof suggests looking at:

• The time it takes for a sales rep to respond to an inbound inquiry
• How many demos a rep has per day or week

“Don’t wait too late to build a BDR team,” said Bret. “Look at lead response times and your reps’ calendars. If their schedules are full, then hesitating to move forward with BDRs can ultimately affect the company’s revenue.” 

Business development commission structure: Getting started

So, if the time is now to add your first BDR team, here’s what you need to know to get started with your business development commission structure.

Set main responsibilities

You’ll want to begin by setting the main goals and responsibilities that you want your BDRs focused on.

Are they following up on inbound leads, or are they responsible for cold outbound as well? What is their primary goal, to run demos or set demos? Convert free users to paid users? All of the above? 

Start here so that your comp structure can follow. 

Establish pay mix

Now you’re ready to set your pay mix. In Compensation Hub, our pay mixes for SDR comp plan templates follow a 68:32 split. That means 68% of the plan consists of base pay and the remaining 32% is tied to commissions.

We see this split most often because BDR roles are frequently considered entry-level sales roles which tend to have a greater percentage of guaranteed income. 

However, 50/50 pay mixes are also fairly common at this sales level. 

Additional reading: What is pay mix? 

Define Quota and OTE

Once you have your pay mix set, you’re ready to determine your quota and on-target earnings (OTE). 

Your OTE is the expected amount of total income the BDR makes if they hit 100% goal. It includes both the base pay and the variable compensation.

In 2023, Betts Recruiting reported the following average OTEs for BDRs:

• BDR (Recent Grad)
  • $50K salary | $70K OTE
• BDR (6+ months experience)
  • $60K base | $80K OTE

Now that you have some average salary business development rep numbers to consider, you should be ready to define your quota. 

The quota represents the numerical goal that individual sellers and teams must reach by the end of a specific period. In our experience, about 45% of the plans on QuotaPath fall under a quarterly quota frequency. Meanwhile, 25% of the plans follow annual quotas, and another 25% 

follow monthly quota cycles.

Your quota should be 5x to 8x the size of your BDR’s OTE.

How to set a quota

The formula we adopt is as follows:

Activity x conversion rate = Opportunities x close rate
= # of Closed/Won deals x average contract value = Revenue

 Backward, this looks like this: 

Revenue / average contract value = # Closed/Won deals / close rate
= Opportunities / conversion rate = Activity 

Example: 
SDR OTE: $72,000
Quota (5x OTE): $360,000
Monthly quota: $30,000
Average contract value: $15,000
Close rate: 10%
Conversion rate: 2.5%

$30,000 / $15,000 = 2 closed/won opportunities / 10% close rate = 20 opportunities / 2.5% conversion rate = 800 activities per month (or 40 activities per day)

Another way to look at quotas is to determine how much of your new business your BDR team will be responsible for. Operatix, for example, reported that BDR teams at SaaS companies are responsible for producing between 30 to 45% of the sales pipeline. 

If you follow that logic, take your annual number of new revenue. What is 30% to 45% of that number? That’s your BDR team’s quota, which you can then divide based on the number of reps you have. 

The last step involves defining what sales activities you want to pay your BDRs on, which we unpack below. 

Business development compensation plans to consider

Next is determining what events trigger a commission or bonus for your BDRs. You can pay on activities, closed/won deals, or a mixture of both — which we see most commonly. 

Activity-based BDR compensation plan: 

• Demos Completed Bonus: This sales compensation plan rewards your team for scheduling demos that actually occur which aims to keep no-shows at bay. Anytime a demo runs that the BDR schedules, the rep earns $160.
  
• Qualified Opportunity Bonus: The Qualified Opportunity Bonus example pays a bonus on every opportunity the BDR sources and hands off to the account executives. The quarterly quota here (before adjusting) calls for 30 qualified opportunities per quarter that pay $200 an opp.
  

Closed-won commission plan:

• Closed Won Commission: Use this compensation structure when you want to give your BDRs a piece of the deal that they helped generated. This compensation template includes a 4% commission rate that’s applicable to every deal that comes from a BDR.

Mix of outcome + activity-based plans: 

• Qualified Opportunity Bonus & Closed Won Commission: We love this combination because it promotes quality leads and gives the BDR a taste for the commissions they could earn when they become an account executive. Before adjusting the inputs in this template, the rep would earn $100 for every opportunity generated and 2% off every closed/won deal.
  
• Opps Created & Demos Completed Bonuses, & Closed Won Commissions: This model blends two activities with closed-won commissions. The Demos Completed Bonus, which pays $25 per demo, accounts for 25% of the total variable while opportunities created account for 50% and pay $100 generated opportunity. And, since the rep is earning variable pay from three sources, the commission rate on closed-won deals drops to 1%. 

Which one should you use? That’ll depend on your business model and how much you’re willing to pay your BDRs. The more “paths” they have to earn incentive pay, then the more complex the plan grows. However, that shouldn’t deter you from adopting a plan that promotes quality leads and rewards the BDRs for sending hot opportunities to the AEs.

Plus, when you adopt automated sales and commission tracking software, we’ll keep everything up-to-date and calculated correctly for you.

Examples of business development compensation models

Qualified Opportunity Bonus

This model only pays a bonus when they send their account executive a qualified opportunity.

Activity Breakdown: 

Qualified Opportunity Bonus & Closed Won Commission

A compensation plan template that pays the BDR a qualified opportunity bonus and a percentage of the closed/won deal upon the AE converting the lead to customer.

Activity Breakdown: 

Business Development Manager Compensation Structure

For a business development manager compensation plan, structures will mirror the reps’ plans with a leadership twist. 

For example, if your reps are responsible for completing 180 meetings per month, and your team consists of 6 reps (equals 30 meetings per month/rep), then the manager would earn a fixed bonus for each meeting held. Additionally, a buffer will likely be in place so that the manager earns 100% of their incentive pay if the team hits 90% to the goal. 

Example:

If your BDR team earns commissions from meetings held as well as a commission percentage from closed/won deals, your business development manager compensation structure might look as follows:

Example:

Note: 

• If your BDR plan relies on the number of cold calls or the number of activities completed, your managers are typically not held to that. 
• Additionally, the split on the structure for the manager weighs heavily toward revenue. For example, if a rep is paid 50/50 between the number of demos and revenue, the manager might earn 30% from the number of demos and 70% from the revenue generated by the team. That’s because the manager of the team has more long-term control over the success of the team versus the individual rep. 

Bonus structure for business development: compensation policy

Congratulations. You should now feel confident building out your business development incentive structure. 

Your final step involves drafting a compensation policy template for you and your reps to sign off on. 

Download Form

This document ensures understanding from both parties and can be referenced if a commission dispute arises. We recommend issuing a new commission agreement every time you make a change to an existing compensation plan or roll out a new one. 

It should highlight your commission and bonus rates, payment terms, performance metrics, and clawback clauses (if applicable). 

Feel free to download our SDR compensation policy template to help guide yours. Note: this plan defaults to the Qualified Opportunity Bonus & Closed Won Commission SDR comp plan example. 

Then use QuotaPath to automate the distribution and collection of signatures using our Plan Verification feature. 

FAQs:

Why is business development compensation important?

Business development compensation is important because it helps to attract, motivate, and retain top talent.

More importantly, your business development commission structure can help steer your BDRs toward potential leads that are the highest in quality and most likely to close. That’s especially necessary in a job function that typically compensates on quantity not quality. 

But, with the right business development compensation models and corresponding business development manager compensation structure, you can put comp mechanics in place that improve the leads and pay your SDRs/BDRs/or MDRs for doing so.

There are a few key things to keep in mind when designing a business development compensation plan:

• Set clear goals. What do you want your business development team to achieve? Do you want them focused on ideal customer profile (ICP) leads or a specific industry? Design a comp plan that pushes them in that direction. Once you know your goals, you can create a plan that will help them reach them.
  
• Make sure your plan is fair, logical, and competitive. Your business development team should be able to understand how they can earn money and how their compensation is calculated. Additionally, the plans need to make sense logically and include competitive on-target earnings (OTE) based on region, experience, and size of the company.
  
• Evaluate twice a year. Your business development compensation plan may need to be adjusted as your business grows and changes. Keep a pulse on rep feedback, total earnings, and effective rates to see how successful your plans are. 

By following these tips, you can create a business development compensation plan that will help you achieve your business goals.

How do business development incentives affect general sales team incentives?

Business development incentives affect general sales team incentives based on the selling behaviors you’re motivating. For instance, if your compensation model motivates BDRs to generate and nurture quality leads with the highest chances of closing, then your sales team is more likely to achieve quota and meet or exceed their OTEs. 

Reversely, if your business development commission structures focus solely on quantity, such as the Demos Completed Bonus, your BDRs might drop their quality checks and send dozens of poor leads to your AE team. Then, while your BDRs consistently hit their demos completed number, your AEs continue to miss their goals.