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Forget Cash, Show Me the High-End Goods
May 05, 2008
Sony's Jimmy Beyer discusses the power of high-end merchandise
By Jeremy Cohen
When the person driving the wagon wants his team of horses to start pulling, he has to decide whether to use the carrot or the stick. While urgency might occasionally mandate the use of the stick, most people agree that motivational tactics are more effective than punitive ones.
Still, the horses don't move when someone promises them a carrot down the road; it has to be dangling right in front of their eyes before they lift their iron-shod feet. Human beings are obviously much more complex than equines, but there's still a valuable lesson in there for sales managers: Merchandise motivates.
Jimmy Beyer, national sales manager for Sony Electronics Premium Incentive Sales Group, spoke with Incentive about how to get people buzzing by showing them product.
IM: When considering what type of reward to use in an incentive program, what are the issues a sales leader must understand about products and merchandise?
JB: There's a place for all types of incentives, including gift cards and travel rewards, but one of the biggest advantages to giving merchandise is that you can choose the hottest, latest and greatest products on the market. If managers know that Sony will be releasing a brand-new product in three months, they can build programs around a product that's so new and cutting-edge that it isn't even commercially available yet. And sometimes, by working with the manufacturers, you can even get a discount that allows you to give away products that have a retail value higher than you're paying for them. That's a valuable way to stretch resources in tight financial times.
IM: What about the challenges of using merchandise, then?
JB: Probably the most common mistake people make is that, unlike gift cards or travel vouchers, the product needs to be created, shipped and warehoused. At the beginning of an incentive program, some managers choose their reward items by going online or to a retail store. The problem is that by the time the program ends and the sales leaders go to source the product, they discover that many of the items they chose are highly allocated, and sometimes even discontinued. Then salespeople don't get their rewards when they were supposed to, and if the product is discontinued, they end up with a substitute that might or might not have the same appeal for them.
IM: If the manager chooses a merchandise reward, how much lead time does he or she need to build into the schedule?
JB: It's impossible to say, because every product is different. There is no single answer that eliminates all of those problems. That's why we like to work with sales leaders when they're in the planning stages of an incentive program, usually about three to six months before fulfillment. That allows us to guarantee two things: that the reward merchandise delivered is the exact item that was promised when the program started, and that it will be available on the date it was promised. I can't stress how important both of those things are. Salespeople work very hard to reach their goals, and when they get something different from what they ordered, it can be very disappointing, even when the replacement merchandise is of the same type and approximate value.
IM: Does a sales leader need to have the framework of the plan in place before engaging with product manufacturers, or can you help them develop the details of the plan itself, in addition to providing the reward merchandise?
JB: We can simply provide the merchandise if that's the way a company wants to go, but the process works best when sales managers talk to us first.
Send comments to incentivemagazine@nielsen.com.
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