Revamped comp resulted in an 18% increase in revenue
Over the years, our company had transitioned from one that thrived on new business to one that was primarily made up of repeat buyers.
But our reps were still spending most of their time trying to close new business, rather than building strong relationships with the customers who brought in most of our revenue.
The reason: Our comp was set up in such a way that it paid high commissions for closing new business, but almost no commission for closing repeat business.
Our company had gone through a major transition, but no one had adjusted the comp to reflect that change.
All buyers are created equal
So we restructured the comp to reward reps for growing their territory, rather than simply closing new customers.
This way, they had incentive to keep existing customers and strengthen those relationships, while spending an equal amount of time prospecting for new business.
We also empowered reps by giving them ownership of the territory they handled.
Result
An 18% increase in revenue, along with an increase in the number of reps who reached quota.