Use of online tools for managing, tracking and executing incentive programs is growing by leaps and bounds. Now, a variety of firms can meet the requirements of almost any incentive program, making a sales manager’s work more cost effective and easier to implement.

 

 

 Centive of Burlington, MA, has provided online tools for incentive management for seven years, according to Chief Marketing Officer Bob Conlin. Centive offers a hosted solution that handles all aspects of sales comp – from cash compensation and commissions through noncash “spiffs.” 

 

 

 

“Incentives are the last great cost center to automate,” Conlin says. “About 90 percent of firms in the middle market still use a bunch of separate Excel spreadsheets to manage their commissions and spiffs.

 

 

That means reps may have no way of knowing their day-to-day status in various incentive programs – and even their commission payments can be subject to questioning and delayed resolution. Without automation, managers as well have a hard time pulling together the impacts of various cash and noncash incentives.

 

“We provide at one glance an incentive dashboard that is secure for both reps and their managers,” Conlin explains. Each night, reps download the commissions earned to date, and the next day, they can see their commissions, their rank against peers and against their own personal goals.

 

The Centive tool can even import sales opportunities from a firm’s customer relationship management (CRM) system, so reps can estimate the incentives they will get if they close these opportunities. “They can model their potential earnings, which can light a fire for higher sales,” says Conlin.

 

 

Centive embeds the correct spiff information in each personal dashboard according to program rules. “It gives them a detailed description of the program, tells them how many days are left and shows them their attainment against reward hurdles,” Conlin says.

  

 

The dashboard for managers allows a complete and accurate measurement of the total cost of sales at each management level. It also provides a clear picture of how each rep is doing against goals. There are no messy spreadsheets to consolidate or update. It is all in one place, updated daily.

 

The Centive tool starts out at $70 per rep per month for a small sales force, with discounts available for larger accounts and multiyear subscriptions. “It costs less than a cell phone and can be implemented in 30 to 45 days,” Conlin notes.

 

 

Centive makes one version of the application – Enterprise Incentive Management (EIM) – for large companies with tens of thousands of salespeople. Incentive Compel is the new hosted tool designed for middle-market companies with $250 million to $1 billion in annual sales (or about 75 to 500 sales reps). “It is a godsend for smaller companies, because it makes it affordable for reps and managers to know all about incentives at a glance,” Conlin says.

 

Behind the dashboard, there is a lot going on in online incentives. For example, WildCard Systems provides the backbone that enables prepaid gift cards to be redeemed, according to COO Gary Palmer. The key is real-time connections that immediately load new values on MasterCard, Visa and Discovery cards. “Cards can be branded, and reloading them means consistent winners can save up to buy something big,” Palmer notes. Real-time value additions give winners instant gratification that can be reinforced by instant email messages.

 

 

 Marketing Technology Concepts (MTC) offers an extremely robust set of online tools especially designed for managing incentive programs run by manufacturers and their channel partners, according to MTC President and CEO George Kriza. MTC’s Channel Manager helps manufacturers manage incentive programs for employees of many distribution outlets. A newer and more distinctive tool, MTC’s SpiffCentral Vendor Manager, does the reverse: it helps major distribution partners manage all the manufacturer incentive programs for which their employees are eligible.

 

 

 One virtue of integrating all incentive programs online is consolidating the reward itself. Although MTC tools can work with travel and merchandise rewards, they generally combine all the rewards for one employee in one Visa, MasterCard or Discovery card. That allows high performers to instantly check out their total incentive earnings on one personalized Web page. Using MTC Channel Manager, the manufacturer has a clear and detailed picture of how all its incentive programs are working, where the payoffs in higher sales are greatest and how effectiveness might be improved.

 

 

 A major retailer, for example Office Max, has another challenge. Its employees are often eligible for incentive gifts from hundreds of different manufacturers. The retailer wants employees to find out about these incentives easily and quickly and thus sell more. However, the major retailer also wants to control what kinds of incentives are being offered to its employees and to understand how these incentives influence employee behavior. That is where SpiffCentral Vendor Manager comes in.  

  

 

“This is a win-win-win for everybody,” Kriza emphasizes. “The retailer does not want manufacturer incentives to conflict with its business goals. The employee does not want to walk around the selling floor with 15 or 20 different debit cards in his pocket. Vendor Manager makes it easy to launch a new incentive, make sure the retailer’s rules for incentives are automatically enforced and make the whole thing simple to use for employees and easy to administer for the company.”

  

 

Globoforce has been helping multinational companies run their online incentive programs in 40 countries around the world for the past six years. Globoforce President Eric Mosley says multinational firms want to consolidate all their incentive management for both internal sales and outside channel partners. Globoforce offers the tools to work in many languages, currencies and cultures. The company offers three kinds of hosted incentive Websites for each client: one for reps to check and redeem their awards, one for sales managers to track their incentive programs and one for program administrators. Such US firms as Microsoft and Intel have found these tools attractive.

 

 

 About half of Globoforce incentives are given to inside sales reps, the other half to employees of channel partners. Incentives are awarded for everything from boosting sales to achieving product education and completing CRM entries.

  

 

Mosley says the key is always tailoring awards to local cultures while keeping the program integrated and manageable. “For example, if an American company sends freeze-dried steak to Europeans, they find them not very useful, and that breeds cynicism.” Generally, even well-chosen merchandise awards are unworkable across international borders. “The winners spend half their time worrying about shipping and getting them through customs,” Mosley notes.

 

So Globoforce works with gift cards and certificates that can be turned into purchasing power at the most popular local outlets. Outside the United States, paper certificates are still much more common than digital buying power. Globoforce has established relationships with hundreds of retailers in each country market, so it can pick the right set of popular choices. For example, restaurant incentives are popular in the United States and in Japan. The French and Germans, on the other hand, tend to prefer certificates for fashion and sports stores.

 

 

 Behind the management tools are the gift-card providers. ValueLink offers gift-card solutions that work directly with merchants, such as Blockbuster, and restaurants that offer gift cards, according to Global Marketing VP Karen Larsen.

 

 

 According to a 2004 survey by ValueLink, gift cards are now second only to cash as an incentive reward. The top reasons for this preference are the flexibility and choice the cards offer reward winners, the value of getting discounts off face value for large orders and the ease of distributing cards across the nation and even the world.

 

 

 Online gift cards also offer better tracking and reporting of incentive activities, Larsen notes. “You can find out what winners spent their cards on,” she says. Reloadable gift cards enable companies to reward staff easily and automatically for consistent performance.

 

 

 Firms should still remember that any award should have a trophy value. Even additions to a card’s value should be accompanied by a ceremony or message from management that thanks employees for keeping up the good work. “You don’t want it to become an entitlement,” Larsen says.

 

Larsen sees several new trends in the use of online gift cards. First, smaller companies are increasingly turning to cards for local retailers and restaurants. “There is a strong interest in giving families a special night out at a restaurant with table service,” she notes.

Second, there is much more online redemption of cards at major national outlets. Third, winners are being offered cards with online access to virtual malls, or a wide selection of stores, on the Internet.

  

 

Another trend is customizing cards with company logos. This adds several weeks to card production – so it needs to be planned ahead of time – but it increases the incentive power of the cards.

 

VIPGift has provided a very flexible online gift card since 2000, according to Project Manager Steve Smith. The firm sends stored-value gift cards by mail or email that can be redeemed on its Website, or on a Website customized for your company and incentive program.

 

 

“You just enter your VIPGift authorization number on the Website, and you can pick your own prize,” Smith emphasizes. You can exchange your VIPGift card for merchant gift cards for such top retailers as Land’s End, Bed, Bath & Beyond and Target, or movie rentals or phone cards. You can get a gift check for a local retailer or restaurant. You can go the VIPGift’s own product catalogue to pick a specific item. You can exchange your card for a Visa or MasterCard to hit the local malls. You can even donate your reward value to your favorite charity, all over the Web.

  

 

VIPGift cards come in denominations of $25 to $250. They are not reloadable, so more cards must be purchased for continuing incentive programs. The firm charges a couple of dollars for each card, which can be purchased from any of five sales offices or on the Web at www.vipgift.com.

 

As a full-service incentive provider, VIPGift can help you design your incentive program to maximize sales. The firm also can customize a Website for each client at no extra charge. “We own our own software and have graphic artists onboard who can make the site look just like your company’s site,” Smith emphasizes.

 

 

 For the real feel of cash, Western Union provides online giftgrams, which are gift checks that can be used for a wide variety of reward purposes, according to Product Manager Tony Crea.

 

 

 Incentive managers may log on to www.westernuniongifts.com and place their order for the amounts and winners. You can prefund your awards, and the desired checks will be sent out the same day, either to you or directly to your winners. You may also send a payment after you place the order, and the checks will take slightly longer.

 

 

 Either way, you get personalized checks from Western Union that have your company logo and a message congratulating the recipient and noting the reason for the prize. Checks can then be directly deposited in winner’s accounts, similar to payroll or commission checks.

 

 

 Giftgrams are like cash – except with a few advantages. They are customized for the award, and Western Union’s Website lets you monitor and track your awards for company- and personal-tax purposes. Each check can be made out in whatever amount you desire for a cost of only $3.75 per check. Crea says checks for $5,000 or $10,000 can be sent out, although typical rewards are much lower. “You don’t have to order and pay fees on separate checks if you want to give a large amount,” Crea notes.

 

 

 “Anytime you want to send money with a message and recognize an employee, these giftgrams are ideal,” Crea emphasizes. “The personalized message reminds the winner of the achievement that earned the award.” So if you are looking for personalization, unlimited denominations and an online ledger of awards, Western Union could be an economical way to get your incentive message delivered.

 

 

Online incentive programs

 

 

Places to go on the Web for incentives:

www.Centive.com

www.giftcertificates.com

www.globoforce.com

www.mtcperformance.com

www.salesdriver.com

www.valuelink.com

www.vipgift.com

www.wildcardsystems.com

www.westernunion.com

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