Best dealer incentive programs

This detailed breakdown showcases how Incentive Solutions helped a global manufacturer use factory to dealer incentives to inspire their dealers to fill in gaps in customer data.

Helping them learn how to build dealer relationships and unlock the doors to new verticals. We provide everything you need to revamp your distribution channel strategy. Ask about custom integrations! Choose dealer rewards that effectively motivate your dealers to prioritize your brand.

Let our ROI-certified account management teams become a true extension of your business. An exploration of the challenges facing manufacturers today.

Arm yourself with actionable advice for identifying where and how incentives can make the biggest impact in your channel. In addition to administration and award redemption, the Web can help administrators achieve their business goals. It has become an effective method to train scattered sales forces on new products.

Considering the technology available, some training programs resemble the most advanced computer games. A telecommunications company used the Internet to increase suggestions from its off-site repair network, believing they were a good source for sales opportunities. The field staff would look for holes in existing client systems or be alert regarding comments on the competitors' products. Repair people received points for such leads and even more points for tips that generated business.

But one of the worst is having a great program that no one knows about. Since dealers can choose from a multitude of programs, a strong promotional element to your incentive campaign will help break through the clutter and grab their attention. You have to get the word out and keep it going, so make communications a top priority. Participants should be able to enroll and participate in several ways: mail, Web, telephone and fax.

People won't participate if it looks too complicated or time consuming. All these options allow participants to communicate at their comfort level. If your company has an in-house graphics department, get them involved at the beginning. Also, experienced award manufacturers or distributors should be able to offer their expertise.

When planning your communication campaign, consider the following: Use teasers to drop a hint about the coming program. Teasers are often accompanied by a gift related to the program's theme or grand prize. Send an announcement piece clearly stating the rules, objectives, structure, length, awards, etc. Also include contact information for questions or comments.

Design kickoff materials that generate enthusiasm for the program. If time and budget constraints allow, stage a live kickoff at your annual sales meeting or at a trade show that a majority of your participants will attend. Use promotional pieces during the program every few weeks.

Remember, a message has to be delivered several times before it's completely absorbed. The more you reach out to people, the more successful your program will be. Distribute mailings to update participants on their progress on a regular schedule. Email works especially well for this purpose. Updates are a wonderful opportunity to get in front of participants.

Along with the final standings mailer, send a congratulatory note and a letter from the company president thanking the distributors for their contribution. A successful dealer program will pay for itself, but you will still need to spend money up front for promotion, awards and administration. There are a variety of ways to develop a budget.

Some planners allot per winner about four percent to seven percent of the base pay of the average participant. Others prefer to figure five percent to 10 percent of the value of the expected sales as the total cost of the program. In terms of closed versus open programs, the fixed plan allows you to establish a firm budget at the start and is easier to plan financially.

One downside to open-ended programs is they tend to generate higher administrative costs, and the total price tag is unknown until the campaign has ended. However, if designed correctly, extra sales generated will more than cover such costs. Regardless of the method, the majority of your budget-about 70 percent-should be spent on awards.

Promotion is next, claiming 15 percent to 20 percent. This figure is a bit higher for dealer programs in comparison to other types of incentives because you have to work harder and spend more to get this group's attention. Administration usually requires about 5 percent. The remainder of your money goes toward training. This budget line is especially important in dealer programs if you are launching a new product.

Detail what worked and what didn't to help those who plan the next incentive. This important analysis will help prove the success of the campaign and point out ways to refine future projects. Ask the administrators if they encountered any problems and what they thought worked particularly well. Be sure to explore all the intangible aspects of the program. In particular, get their input regarding the objectives of the program, training and ideas for future awards.

If possible, speak directly with recipients to learn what they thought about your dealer or distributor program. If you think they would be more honest responding through an anonymous survey, then make one available to them. The best dealers ignore my products once they reach the top award level of the program.

Any suggestions? Design the program so a participant is never done with it. One option is to offer top brokers a chance to earn extra merchandise in addition to the top-level awards.

Since this will be a very small group, make the rewards as personal as possible to increase their appeal. Is this a problem? The good news: These people are reminded of your program on a regular basis. All of their suppliers want them to stock more product and support it better in the marketplace. Based on your meeting with key distributors or agents, you should have come away with other ways to help them achieve their objectives.

Note: You will get little response unless you set goals that are attainable to a broad portion of your target audience. Here are a few basic incentive program options, which in some cases can be mixed and matched:. Depending on your objectives and audience, you may want to use cash, cooperative marketing dollars, or non-cash awards, such as merchandise, travel and gift certificates. Mass merchandisers will make their needs known quickly.

Smaller business owners and managers, however, often enjoy the benefits of receiving merchandise and travel awards, including the chance to meet with colleagues from other parts of the country. In evaluating your choices, look at what competitors have done and try to determine what options will get the most attention.

A professionally conducted customer council is often the best way to find this out. Whatever you do, change it for the following program.

Variety is the spice of any ongoing incentive program. Experiment continually, and track results. The great advantage of incentive programs versus other types of marketing efforts is the ability to track results precisely. All of the structures outlined in Step 4 can be measured clearly if you track basic sales data.

Full-service incentive companies offer tracking programs that not only follow sales activity by dealer or salesperson, but also provide regular updates to the target audience as well as monthly reports to you.

If you structure your budget properly, the program will cost relatively little, unless performance exceeds your quotas or objectives by a wide margin. On top of that, you should allow for the cost of awards should performance exceed the quotas or goals.

The closed-end program that selects the top performers is the easiest to budget, because you have a predetermined number of winners. Then, establish whether you want to implement the program on your own. Critical issues include administration, databasing, tracking, communications, training and award fulfillment.

Full-service incentive companies handle all these functions, and smaller specialists can take on one or two. If your company is too small for a full-service incentive company, it can buy merchandise and travel directly from leading consumer products and travel suppliers. Now that you know the structure and budget, you have to write the rules that will be incorporated into all of the communications. The rules should spell out all conditions for participation in the program. Have several people not directly related to your business read the rules to make sure anyone can understand them.

Also, lottery laws forbid programs that require independent dealers or distributors to make purchases in order to participate in sweepstakes or contests based on chance. Getting the attention of your audience is a challenge, since dealers and distributors receive offers from many suppliers. Make sure your program is easy to understand and filled with benefits to your target audience.

Throughout the program, provide participants with useful information to help them succeed with it. Launch the effort with an enrollment kit that asks for basic business address information along with tax identification numbers, when applicable.

The kit should also prominently specify the program duration. Since your program should support your marketing objectives, link it as much as possible to the overall marketing push. Develop a theme for the incentive program and try to relate it to your marketing themes. This will help people remember it.