The war for top talent has never been more competitive. In the U.S., 11.3 million job openings remained vacant as of February 2022.
The fight to retain top sales talent is even more fierce. Companies in red-hot industries, such as e-commerce, fintech, and technology, are dangling high salaries, forcing human resources teams in other industries to match pace – or lose their staff. And even global brand names struggle to keep their sales teams. A Forbes article states that in Silicon Valley, it’s not unusual for companies to lose up to 25 percent of their sales professionals every quarter.
This talent crisis is costing your firm dearly. Losing an extra five percent of your salesforce can increase your sales costs by four to six percent and decrease revenue by two to three percent, according to Blue Ridge Partners, a consultancy that builds high-performing revenue teams. At 10 percent, companies in low-growth, low-margin verticals see their revenue plans and margin destroyed, while 25 percent attrition increases selling costs by 50 percent and hammers revenues by 20 percent. In addition, customer trust and relationships may be left by the wayside, creating a self-perpetuating cycle of business losses that firms can’t break out of.
It’s clear that retaining sales representatives is a major imperative for your company. And you’ll want to retain both top and middle performers. While top performers will out-deliver on their targets, they likely represent around 20 percent of your salesforce. In addition, they’re the most likely to be recruited and leave your company for other opportunities. Meanwhile, the middle 60 percent still achieves quota and significantly contributes to driving revenue. (Typically, the bottom 20 percent of sales representatives either get managed out or leave on their own accord.)
So, how can you improve the engagement and retention of your sales team?
1. Understand what motivates representatives
Understanding what each top or middle performer cares about can help you craft the right incentives for your team and each person. For example, work-life balance advocates might care most about reasonable management expectations, working remotely, and structuring their hours. Free spirits may want to move to a different geography or have a richer vacation package. And corporate climbers may be laser-focused on being mentored by senior leaders, working the best territories, or being assigned to strategic customer accounts.
Your goal should be to surprise and delight. If you know your top-performing account executive (AE) loves to wine and dine, you can pay for a nice meal on their next vacation. Similarly, everyone likes to be recognized for life events, such as engagements, marriages, and birth announcements.
2. Develop a strong sales culture
Simon Sinek famously says, “Start with the why.” That’s good advice, not just for companies as they develop market-facing messaging but also as they syndicate the company mission, vision, and strategy. You can offer facetime with senior leaders, hold strategy and quarterly offsites, host regular lunch and learns, and pay for industry conferences and certifications. In addition, managers should ensure their staff has the right sales enablement tools to make customer interactions go as smoothly as possible.
Similarly, you can use data and digital tools to empower sales representatives to own their careers. For example, you can use CaptivateIQ to provide your team with benchmark data on sales organization performance so that every representative knows how they are performing against organizational averages and best-in-class performers. Providing this data enables managers to inspire representatives in a powerful, proactive way.
3. Provide new challenges and opportunities
Skilled sales staff are usually hungry to learn more and develop their capabilities. For corporate climbers, this will mean taking on more challenging assignments. For example, they may want to move from the mid-market to the enterprise segment, call on the C-suite instead of VPs, or work on more complex sales.
Companies can also provide data on how close representatives are to meeting quota and their dream numbers. This information may inspire staff to use new strategies to drive sales, such as targeting new markets and customers or giving undecided prospects an extra push.
In addition, companies may use variable compensation or different performance measures to support sales goals. For example, managers may choose to reward a representative who penetrates a brand-new account more highly than one who mines a reliable account. In addition, richer rewards may go to the team member who sells upmarket products, collaborates with partners on integrated solution sales, or successfully establishes a beachhead in a new industry.
4. Have a defined career path
Besides taking on new assignments, sales talent will often want to have a codified career path. Whether your top and middle performers stay or go may depend on their ability to gain cross-functional assignments and early leadership opportunities. Your representatives may want to develop their talent stack, progressing from hands-on sales to operational and management roles. Many representatives seek to become sales managers to craft sales plans, mentor a team, and reap the rewards when the team exceeds quota. Still, others may want to climb the ranks in other functions, such as working towards a chief revenue or marketing officer (CRO/CMO) role.
Provide a clear line of sight on what is required to reach the next level. For example, at CaptivateIQ, representatives know that they need to book $400K in annual recurring revenue to be promoted to a second-level AE. This transparency keeps staff focused on the right goals.
5. Provide managers with tools to drive performance
Since they are responsible for sales teams’ quota attainment, managers need to be able to review their performance in real-time. Managers can use this data to reward top performers with public recognition, bonuses, and new opportunities for overachievement.
They also can identify sales laggards to provide them with targeted mentoring and training. CaptivateIQ provides highly customizable dashboards and reporting, enabling managers to drive quickly to insight and use this information to evolve employee engagement and retention strategies continually.
6. Have a good compensation plan and automate workflows
Providing a good compensation plan is essential to woo and retain top talent. These representatives are in high demand and will typically migrate to the firm that offers them a richer deal.
In addition, it’s important to get commissions right. Automating processes with CaptivateIQ eliminates errors that can cause delay, creating sales representative mistrust. After booking a big deal, a sales representative may want to go out and celebrate, not hound managers and payroll teams to pay out their commissions.
CaptivateIQ integrates with Salesforce, ADP Workforce Now, and QuickBooks Online, allowing organizations to reduce commission processing times by 90 percent. Administrators can use the iFrame in Salesforce to pull data, put together pay period statements, and send them to each representative for their approval. If there are omissions or other errors, representatives can use CaptivateIQ to ask administrators to correct them quickly and efficiently. If the information is correct, they can use CaptivateIQ’s integration with DocuSign to approve statements for payment.
7. Provide transparency around commission processes
Today, many commission processes are siloed in Excel spreadsheets, which are challenging to analyze and often out-of-date.
CaptivateIQ provides forward-looking guidance that’s clear and easy to understand. The platform shows representatives what they need to do to attain their required quotas or dream numbers, how commissions are structured, and what it will take to earn all bonuses. As a result, both representatives and their managers can see current earnings as well as what’s possible for these individuals to attain for the quarter and the full year.
Providing your team with clear, forward-looking statements from CaptivateIQ will be tremendously motivating. The platform uses expectancy theory to drive better results. As a result, reps focus on the right activities to drive their pay, while managers can use the same data to have focused conversations about attaining their personal goals.
Retaining top and middle sales talent will continue to be challenging in this market environment. As a result, many sales leaders are taking a fresh look at their employee retention strategies, to see how they can incentivize teams to achieve more and stay longer.
These seven tips will help you customize sales retention strategies for your organization and individual performers. CaptivateIQ can help you create greater transparency around commission processes, aligning and motivating your team to achieve ambitious growth and revenue targets. Many sales representatives want to outperform: give them the tools to do so.