1 Executing a Successful SPIF BEST PRACTICES, TIPS, AND TECHNIQUES SPIFs are a great way to generate enthusiasm and mindshare, promote market adoption of a new solution, incent the sales of a specific combination of products, or even to reward soft skills development. However, execution is where most programs fall short of success. This ebook will help you to sidestep the pitfalls and provide useful and practical advice to start a SPIF program and/or helpful tips to improve under-performing SPIFs. ebook from CCI: Channel Management Solutions
2 2 Contents Defining SPIF SPIF Challenges Best Practice #1: Design a SPIF Program Versus a Single SPIF Best Practice #2: Optimize Your SPIF Design Six Tips & Techniques for SPIF Design Best Practice #3: The Value of Registration Best Practice #4: Measure Program Success 24 Summary
3 3 Defining SPIF Where We Are In the Incentive Landscape
4 4 The Classic SPIF (Sales Performance Incentive Fund) Sales incentives can be divided into two main types: 1 2 Targeted at the individual Targeted at the partner entity The first is where the classic SPIF sits. Individual sales incentives typically: Are focused on the sales rep or sales engineer Have the core objective of influencing point-of-sale Have program timeframes that can be shorter or longer term This ebook focuses on the most common types of individual sales incentives and their key attributes.
5 5 Incentive Programs Targeted to the Individual Title Definition Attributes SPIF Provides guaranteed rewards to participants for accomplishing a particular action Example: Sell X, get $Y Loyalty Designed to build long-term mindshare and relationship May be designed to reward a variety of behaviors Example: Sell X, do Y, to earn points toward Z Contest Rewards that have an element of chance Example: Sell X or do Y to qualify for winning Z Rebate Drive product sales through temporary price decreases Gather consumer info, promote new products Example: Buy X, get $Y discount or rebate Usually short-term May be quickly deployed Requires re-launch of every program Can tailor for different audiences (SEs/SRs) Difficulty forecasting payout Rewards are often cumulative in nature Longer term More robust infrastructure required Can follow participant Subject to local laws Good for driving mindshare, individual/team motivation/excitement Short or long term in nature Instant or mail-in are the most common Short term Trade-In or Trade-Up program (rebate may go to partner or consumer)
6 6 SPIF Challenges Common Pitfalls of SPIFs
7 7 SPIFs are certainly among the simplest and easiest sales incentives to deploy, however this can often be their downfall. When we talk to clients about SPIFs, it is common to hear about a lot of challenges. Some common frustrations about SPIFs: Here today, forgotten tomorrow no ongoing engagement is derived Constantly have to invent new programs and manage unique processes for each Narcotic in nature the more you use them, the more they seem to be needed Viewed as an entitlement versus a bonus or reward Hard to target the right people partner principals do not allow for individual-level SPIFs run by vendor Difficult to predict payout needed as well as participation Hard to measure impact/roi understanding that SPIFs are most effective in attaining goals The remainder of this ebook will address the above frustrations with some tips and best practices for implementing successful SPIFs.
8 8 Best Practice #1 Design a SPIF Program Versus a Single SPIF
9 9 While SPIFs have the benefit of being easy to deploy, that very aspect can result in a lack of longer-term thinking around them. While SPIFs themselves are best used for short-term initiatives, when designing a SPIF one should not just look at the immediate result or action you want to influence, but at the broader and longer-term needs of engaging with the particular target individual (sales rep, sales engineer, business owner, etc). Vendors are typically engaging with the targeted audience between four and ten times per year. Given this statistic, a programatic versus multiple one-off approach is called for. This leads us to Best Practice #1: Design the Program First, Then the SPIF Program SPIF SPIF
10 10 There are a couple benefits to this approach: First, creating a program will provide you with a framework where individual SPIFs can be deployed. Having a framework addresses the second frustration constantly needing to invent new programs and manage unique processes for each. A programatic approach allows for core processes to be outlined at the outset (and hopefully automated) so that the invention can be focused on the do-get proposition, not on administrative processes. Second, the consistency of a program framework in which to deploy SPIFs will allow you to develop an ongoing engagement with your target audience (addressing that here today, forgotten tomorrow frustration), and gather consistent data on where and with whom SPIFs are working and/or not working.
11 11 Determining Program Objectives The first step to designing an effective program is to think about what types of actions/results you are trying to achieve with your target audience over a minimum one-year timeframe. Is it all about quantitative goals? Number of unit sales of a certain product, average order size, volume sold of a new solution? Or are there also more qualitative goals, skill/knowledge improvements, customer satisfaction scores? Finding the Sweet Spot Once your list of objectives is clear, review them through the lens of how they align with your corporate strategy, customer needs, market environment, and partner strategy. Given that you are targeting individuals who are most influential at the point-of-sale, understanding partner strategy (GTM, Business Goals, SWOT, etc.) and that individual (goals, needs/wants, strengths, weaknesses, etc.) are the key. Going through this exercise will help you fine tune your program objectives and insure you have found the sweet spot for optimal success. Partner Go-to- Market Strategy Corporate Sales/ Marketing/ Channel Strategy Your Program Objective(s) Environment Competition Geography Customer Purchase Process Ongoing needs
12 12 Processes and SPIF With your objectives clear, you can now determine the processes you need to support the types of SPIFs you ll deliver. In most cases, a sales incentive platform or system that automates capture, review, and reporting of participants and SPIF-related data is a good investment to support your program.
13 13 Best Practice #2 Optimize Your SPIF Design
14 14 Now that you have program framework with your objectives, let s explore how to optimize the actual SPIF design. Here are Six Tips & Techniques for SPIF design: 1. Short-term Definition A common mistake made by many channel professionals rolling out SPIFs to an indirect channel is to plan the timeframe for the SPIF in the same way they would for an internal sales audience. A SPIF that would typically run for days or weeks with an internal audience should run for months or quarters in the channel. While familiarity with an ongoing sales incentive program will allow you to shorten timeframes in the channel, in general channel noise requires more time for a SPIF to gain mindshare and traction. Secondly, consider the timeframe in relation to the action requested. A SPIF related to the introduction of a new solution is going to require a longer timeframe than a SPIF whose goal it is to get old product off the shelf before the release of an upgraded model. A SPIF that would typically run for days or weeks with an internal audience should run for months or quarters in the channel.
15 15 2. Focus on First-Time Behavior SPIFs are best suited to incentivize first-time or one-time behavior, as opposed to ongoing behavior. Ongoing behavior is best targeted by your other compensation structure with your partner (percentage of product discount, MDF/Co-op offering, rebates, etc.) SPIFs are most effective when they are reserved for first-time behavior and used with some moderation. This helps maintain a high-energy/high-effort/high-result perception of them, and prevents them from becoming narcotic in nature or viewed as an entitlement. SPIFs are most effective when they are reserved for first-time behavior and used with some moderation.
16 16 3. Get Organizational Buy-In It is key to get (and create) buy-in for your SPIF with partner organization principals. Too many SPIFs that have not taken a partner s GTM strategy and goals into account have resulted in the reluctance of the partner organization to allow the SPIF to run with their sales team. A trend we are seeing is for individual SPIFs to tie into to partner/entity-level sales incentive programs. 4. Getting the Do-Get Right Given the shorter timeframes, the doget proposition needs to be simple, clear, and compelling. Based on your goal, determine if the reward structure should be a per unit/per action basis, or hitting a certain volume. What is going to be more enticing? What is going to best align with your goals? Second, consider the reward itself. Is it cash, merchandise, or travel? Is it the same reward for all, or is it a points-based access to a variety of choices? (See the following page for some reward pros & cons.) Lastly, a crucial part of creating your do-get scenario is to determine the specific metrics needed to measure progress towards your goal, establish your current baseline, and do the cost/benefit analysis on your SPIF.
17 17 5. Effective SPIF Marcom Key to your design is your marketing & communication plan. Communication of the WIIFM (What s In It For Me) message to the sales reps needs to be clear, compelling, and engaging. Also, don t neglect to consider any materials or tools that will support the sales reps execution efforts in the field with endcustomers. 6. Drive Ongoing Mindshare Lastly, don t put all your efforts just into the launch of a SPIF. Ongoing engagement is as important, if not more important. Provide progress updates, share success stories, use a leader board to encourage friendly competition, etc., to keep the SPIF goal and reward top-of-mind through its lifecycle. The "What s In It For Me" message to the sales reps needs to be clear, compelling, and engaging.
18 18 Reward Options: Pros & Cons Considerations: What is the do-get proposition? Cash versus points? Evaluate in relation to main compensation structure high enough for interest, not so high as to distract from primary goals Do the math what is your investment compared to your return? Cash Reward Cards Travel/ Merchandise Pros Directly impacts bottom line Good for short-term programs with limited infrastructure requirements Easy to communicate General high appeal due to branded card in-wallet Reloadable cards are ideal for long-term programs Fixed value cards are more suited for short-term programs Offered by majors: VISA, MC, AX are valid anywhere Trophy/lifestyle are highly valued prizes Allows program managers to establish tiers that create a stretch goal for participants Can have longer mindshare impact for participants Cons May have limitations in global markets May be considered part of regular compensation, less of a longlasting impact Infrastructure more costly due to card printing and distribution costs Depending on churn, new card issuance can be costly Global programs may have limitations due to distribution and/or exchange rates Program s appeal is largely driven by reward options and perceived attainment ability Global programs may have limitations due to distribution or local tax codes
19 19 Best Practice #3 The Value of Registration
20 20 An automated software system or platform is helpful in supporting program operations and reducing administrative costs. It will help streamline processes and make data capture (or integration) far easier. Another benefit of automation is that it makes it much simpler to include registration as part of your SPIF deployment process. There are a number of key benefits to the inclusion of registration as part of your standard SPIF process, including: Adoption Monitoring Requiring individuals who are going participate in a particular SPIF to opt in through registration is a great way to get an understanding of the SPIF s appeal (or popularity) with your target audience. Having this insight early on will allow you to forecast outcome (spend, administrative support needed, etc.). If registration levels are too low, it allows you to evaluate whether the program s do-get proposition needs to be adjusted or if marketing communications needs to be increased. Having this insight early on will allow you to forecast outcome.
21 21 Getting to Know Participants A second benefit of registration is that it allows you to capture profile information about participants and, over time, get an understanding of who the top performing individuals are, develop a relationship with them, and target them for specific initiatives. Mindshare Lastly, including a simple opt in registration is a great way to ensure that you are paying individuals you ve gained some mindshare with around the SPIF versus those who just happened to have performed the action/result you re rewarding.
22 22 Best Practice #4 Measure Program Success
23 23 Evaluating Program Success As previously noted, standardizing the process and method of data capture (and use in the case of a claimless approach based on POS data) are the key to being able to measure impact and, ultimately, ROI. Below are three important methods of evaluating program success: 1) SPIF Performance Versus Goal Assuming your goals were established at inception, an assessment is as simple as evaluating program (or individual SPIF) performance against the goal. By using an automated system to capture data during the SPIF s lifecycle, progress toward the goal can be monitored throughout the process. 2) Sales Lift Calculating sales lift over regular sales that would otherwise have occurred if the SPIF wasn t implemented has always been the goal of channel marketers. Doing so requires a comparison between both a test group and a control group of partners. The test group represents those resellers who have participated in the program, and the control group represents a similar group of resellers who haven t participated in the program. Note: Sales should be analyzed before, during, and after the promotion period to truly understand the impact of outside trends that may affect sales (economy, seasonality, competitive conditions, etc.). The duration to be measured pre- and post-program depends upon your sales cycle. B2B products with longer sales cycles will typically require one to three months of data to establish a baseline. 3) Tactical Metrics Just as important as evaluating the strategic end result is examining the tactical metrics. Tactical metrics help determine why a given program succeeds or fails. Examples include: number of partners participating, reasons for non-participation, average/highest/lowest results by rep, etc. Tracking tactical metrics throughout the SPIF lifecycle can provide opportunities to make program adjustments and course corrections to insure that strategic level outcomes are met.
24 24 Summary
25 25 To summarize, let s recap with common frustrations and their solutions as addressed by the best practices, tips, and techniques outlined in this ebook. Frustrations/Challenges Here today and forgotten tomorrow Constantly have to invent new programs, different processes for each Narcotic in nature Not able to target the people I need to Program viewed as an entitlement Difficult to predict participation and payout Can t measure ROI Solutions Create a SPIF program that allows for building relationships with program participants over time Deploy SPIFs with a program framework, and automate to standardize processes Don t over use, think short-term, ideally first time behavior Align with Partner GTM, tie individual and partner entity programs Consider different reward options, don t reward ongoing behavior Pre-test/Preview program and include user registration in process Determine metrics during design, ensure proper capture during execution
26 26 Successful SPIFs can be realized by adopting these four best practices: The Value of Registration Measure Design a SPIF Program Versus a Single SPIF Optimize Your SPIF Design Program Success About CCI CCI delivers comprehensive incentive solutions to optimize sales channel performance. As an enterprise software and services solutions provider, CCI enables channel marketers to manage and measure sales and marketing incentive programs throughout their demand chain, resulting in greater spending efficiency and improved program effectiveness. CCI provides a combination of on-demand software, professional services, and program management. CCI s Professional Services team applies best practices to define and deploy programs that meet your business goals. Equally powerful is CCI s software. Delivered on a SaaS platform, CCI automates your channel programs and partner activity for increased visibility, measurement, and ROI. Once deployed, CCI Program Management delivers services such as contact center support, auditing, and payment services to ensure program operational efficiencies. CCI is proud to work with market-leading companies in technology, telecommunications, and entertainment. For more information, visit or contact us at
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