Do Sales Contests Have Drawbacks ?
Since Doug mentioned in his comment on the previous post that there are negatives to sales contest, I thought I’d add to that thought.
Yes. Sales contests can have drawbacks. Just as any other business tactic, they can have bad, as well as positive effects.
Three of the most obvious disadvantages are :
1) Pre-contest stalling
2) Over-selling
3) Post-contest slump
It’s a well known fact that if you announce a sales contest too early your salespeople will hold off on some sales and putting them into actionable orders.
One way to defeat this is to announce a contest as retroactive to a prior date. That way your sales team will always sell to their potential, knowing that you’ll never penalize them.
Over-selling can also cause your organization some goodwill and can do harm to relationships that are well established and very profitable.
Make sure your sales team uses the Hippocratic Oath - First, do no harm. Or something like that. You get the picture. Or if you know what it is, feel free to leave your thoughts in the comments.
Lastly, we look at The Slump. It’s gonna happen, so you might as well plan for it.
Is there a period during the year that’s historically slow ? In my business it’s January and February, so if it ended right before that, we could use the down time to recharge our batteries and take a vacation to a warmer clime and it wouldn’t hurt as bad, manpower wise.
Also, it’s not uncommon for a rash of new business to come in as soon as a sales contest is over. You might find that a separate contest for the bottom 50% of the previous participants, held as soon as the first one is done can be a very profitable venture.
There’s some of the drawback and a few ways to overcome them. If you can add anything to this conversation, I’d appreciate some help in making this profitable for all of us.
Comments
Leave a Reply
