(I HAVE NO IDEA WHAT I'M DOING**but kind of do** PLEASE HELP)
So It's a month into the new job and it's going great. **dolphin screeches** I've established a lean tech stack (HubSpot/seamless/salesnav), created a sequence and templates that are converting, learned industry knowledge, received feedback from executives on calls/emails, and put my manager on a PIP (naturally). He never made a comp plan so I decided to take the initiative onto myself and curate one for myself and the future SDR's I will be managing and onboarding.
Key tenets of a good plan in my eyes:
3 month ramp with commission built in - i.e.. 1st month of 0% quota attainment paid out at 100% commission. 2nd month of 69% quota attainment paid out at 100%, 3rd month of 100% quota attainment paid out at 100%.
Accelerators. 100%-200% 1.5x accelerator of commissions (Pay 1.5 times per meeting more, instead of 100$ per meeting, 150), 200-300% 2.2x accelerator., 300-400%, 3.5x accelerator
Not sure what the thoughts are on the above strategy^^^
Paid on Meetings Delivered - A qualified meeting being(for us right now this may vary for you): Ideal customer profile, shows up to the meeting, has a need for our product, and is intending on making a decision in the near future.
Knowing I want to achieve a 75k OTE at 100% and my base is 56,000. that means the variable is 19,000/12months is $1583 a month in commission at 100% a month. meaning if I have a goal of 8 meetings a month that will convert too $197/meeting.
Adding in a 5% bonus on closed won revenue at the end of the year.
That's the details I have so far, and my best guess as to what a sexy comp plan looks like.
Questions for discussions:
How do you approach this in your org?
How do I put all this in writing?
Anything you would add or subtract?
Disclosure, I know for more complex orgs it goes backwards from expected revenue you want to bring in to meet growth goals. but that's determined on a variety of factors like close rates, MQL-SQL rates, activity-meeting rates, and avg. deal size rates of which we have none of right now. Only a guesstimate of a 70% close rate which is mainly from referrals and not cold meetings so doesn't count.
Edit: thanks to @poweredbycaffeine aka my father, "as well as ARR Contributed to Funnel (shit that didnt close)
And a rider term that states a qualitative based. Something like training completed, industry knowledge attainment, etc. It shows career development, and is an easy win for anyone on the plan." So from my understanding a term that states if you complete x training or can regurgitate x amount of facts about the industry, you get a x amount of dollars per quarter or month or year
As well an SQL or SAL can be defined extremely strictly or loosely depending on goals. Ours for now is loose. but I know what it is and it will be defined more clearly with more deals brought in. but in general it is: A certain title(C-level), A certain need(Service work), A certain timeframe(0-6 months), A certain relevance(is what they are looking for)
All the love,
The kid.
Also: Heres a good link I found that goes more into depth and gives blueprints.: https://www.saleshacker.com/sales-compensation-plan-blueprint/#s8
1 -Understand the Basic Requirements of a Good Sales Comp Plan
2 -Establish Role Levels
3- Determine Total On-Target Earnings (OTE)
4 - Decide Base Pay and Sales Commission Structure
5- Set Targets Plan Compensation for Onboarding and Training
6- Know what to Include in a Sales Incentive Plan
7- Create a Contract and
8- Get Mutual Commitment [TEMPLATE PROVIDED]
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