Sales incentives: 7 ways to incentivize your sales team

By Amy Rigby|5 min read|Updated Jul 24, 2024

A chart showing revenue growth, money, and an incentive to represent sales incentives.

Sales incentives are effective motivators that can push teams to achieve ambitious goals, sell new products, or have their most productive quarter yet.

Companies with a sales incentive program in place are more likely to retain high performers long-term. They’re also proven to increase sales: SparkPlug, a sales incentive platform, reports that several of its clients have achieved a 50x ROI on incentives.

To be effective, sales incentive programs must be simple and straightforward. However, managers and business owners should vary rewards. A combination of different rewards, whether it be a gift card and praise in a public Slack channel or extra PTO and $100 cash, are more likely to increase sales performance than a single incentive.

Below, we’ll detail 7 different ways to incentivize your sales team to do their best work. Mix and match several ideas for your incentive program for the best results. Or, switch up which rewards you offer each quarter.

Sales incentives are performance-based rewards that sales reps receive in addition to their salary to motivate them. These monetary and non-monetary rewards include bonuses, commissions, trophies, and trips.

Combining multiple sales incentives as part of an incentive program doesn't have to be expensive. Consider layering monetary and non-monetary incentives to keep costs down. Both are motivating: public shout-outs on Slack can increase productivity and motivation by 20%,

Offering your sales reps an experience, like a vacation, art class, or wine-tasting event, encourages them to boost their efforts to win the reward. It also inspires them to share about the experience, which could spur the rest of their team to try to get the reward, too.

“People feel awkward talking about money, so they won’t talk about the $2,000 bonus they received,” says Harvard researcher Ashley V. Whillans, who studies what makes workers happy. “But if you reward someone with a nice dinner or trip, they will talk about it with their co-workers, and that can motivate everyone.”

Here’s a real-life example: One Fortune 500 company was looking for a new way to motivate its top resellers.

Based on the demographics of its team, the company crafted an experiential incentive that awarded top resellers with a "Top Gun" experience. Winners attended a flight school and even got to fly in an F-16 aircraft. This creative sales incentive boosted total revenues by 32% and had an ROI of over $747,000.

Providing professional development opportunities is a great sales incentive idea for boosting sales and retention. In a survey of 1,200 employees, 58% said they were likely to quit if they didn't receive professional development.

Reward top performers with a conference trip, a business simulation, or another L&D opportunity. This will sharpen their skills, give them a break from their usual job tasks, and help them come back selling stronger than ever.

Whether it’s a Slack #praise channel or a team leaderboard, public recognition helps your sales reps feel appreciated, which, in turn, helps them perform better. In fact, 77.9% of employees say that more frequent recognition would improve their productivity.

Take a page out of Signpost's playbook and create a sales scoreboard to gamify the experience. At the CRM software company, whenever a deal closes, the digital scoreboards play a gong sound, and a picture of the salesperson pops up on the screen. Then, teammates get up and high-five the salesperson. It’s a celebration like this that can boost excitement and appreciation.

A common sales incentive is a commission, which is when a salesperson earns a portion (either a percentage or flat fee) of each sale they make.

Because commissions are directly tied to sales, use them to drive an instant bump. In a study published in the Journal of Marketing Research, researchers compared the effects of switching from a bonus incentive plan to a commission-based one (Kishore, Rao, et al., 2013). The transition led to a 24% boost in sales productivity and particularly benefited lower-performing salespeople. Commissions also encouraged continuous sales beyond quota since there was no ceiling like there was under the bonus plan.

However, under the commission plan, salespeople were less motivated to complete tasks that were important for long-term business health but did not lead to immediate compensation. For example, the sales reps were less likely to focus on building relationships with customers because they didn’t earn commissions for doing so.

Unlike commissions, bonuses are less frequent (typically quarterly or annually) and are usually paid in a lump sum after a rep hits or exceeds quota. Therefore, bonuses are effective in helping reps achieve specific targets. But the downside is that there tends to be a dropoff once they’ve reached quota and secured the bonus.

As the study authors note: “Salespeople ‘push sales into the future’ if they are unlikely to meet quota and ‘pull sales in from the future’ if they are near quota. These patterns are more pronounced under the bonus plan.” (Kishore, Rao, et al., 2013)

Based on these findings, it’s best to use a combination of commissions and bonuses. The former ensures continuous efforts, while the latter incentivizes engagement in the tasks that benefit long-term business health.

For one-off gifts that show your appreciation or SPIFFs that encourage a sales boost, use gift cards. Unlike commissions or bonuses, gift cards provide instant gratification and personalization.

When you use Tremendous to send digital gift cards, your reps can choose from over 2,000 redemption options and get their rewards at the click of a button. You can also customize the gift cards with a message and your company branding.

Infuse philanthropy into your sales incentives by rewarding reps with gift cards they can redeem for charitable donations.

In a study published in the Journal of the Academy of Marketing Science, Dr. Valerie Good and colleagues found that a sense of purpose (the belief that one is contributing to a greater cause) was more likely to increase a salesperson's effort and performance than a desire for money.

“While salespeople want to make money, they also want to make a difference and contribute to society through their work,” the study authors write.

Sales reps don’t often get to see their impact beyond closing deals. By allowing them to donate their gift cards to a charity of their choice, you help them tie their work to a cause close to their heart.

This one is easy: money. Research supports the idea that cash is king when it comes to incentives.

In a study involving 1,300 sales agents, 54.5% said they preferred to receive cash, beating the other options of merchandise, recognition, or travel.
Our own research found that money is the most desirable employee gift, while the least favored gifts include company swag, thank-you notes, and experiences.
Another study we ran found that employees value gift cards the same as cash.

When creating sales incentives, remember:

Think short and long term. Running a sales contest with gift cards as a reward is great for a quick bump in sales, while offering commissions encourages continuous effort over the long term.
Cash is king. Sales incentives only work if your sales team wants them. Money is a major motivator for every employee, and salespeople are no different. Sales incentives like gift cards, Visa prepaid cards, and bonuses are highly desirable.

Make it easy to send the sales incentive your team really wants: money. Tremendous simplifies digital gift cards at scale—and it’s free. Book a demo with us or sign up for an account and get started.