With a volatile economic landscape, some might think that channel incentive programs would be the first on the chopping block as organizations look to rein in costs. Yet many channel marketing leaders appear ready to double down on incentive spending in an effort to boost performance this year and beyond.
According to 360insights' Q1 Channel Pulse survey, more than 60 percent of companies predict their channel marketing budgets will be the same in 2019, despite a slowing economy. And among those whose budgets will change, nearly three in four say they plan to spend more on channel incentives. But will that uptick in spending actually lead to an uptick in revenue?
For many organizations, optimizing channel spending is an ongoing challenge. More than half of channel marketing leaders say that getting spending right on incentive programs is critical, according to the International Data Group, a data and marketing-services organization, but only 6 percent are confident they're hitting the mark.
As the economy enters uncertain territory, forward-thinking businesses are finding ways to increase the effectiveness of their incentive programs without increasing overall spend. The key? Data-driven insights. By investing in the right tools, businesses can craft more effective programs that keep their products top of mind on the sales floor.
Turning information into insight
For many businesses, implementing technology to manage incentive programs isn't on the radar yet. One Acumatica study found that 84 percent of companies still rely on Excel for sales compensation and administration. For businesses with sales teams working across the country, however, managing incentive creation, promotion and fulfillment can be incredibly cumbersome. Running programs on spreadsheets also makes it difficult to truly gauge how incentives are performing, with 59 percent of channel marketing leaders saying they have insufficient visibility into sales activity.
A data-driven approach can ensure businesses are spending marketing dollars wisely, while building confidence and trust with channel teams to drive long-term results. Here are five ways businesses can leverage digital techniques to maximize the ROI of their programs.
Real-time program reporting
How much better would your programs perform if you could review and adjust them while in progress? Companies that depend on manually entered program data often don't spot opportunities until it's too late. By using a centralized platform, marketing leaders can use heat mapping to see current sales instantly by territory, dealer, retailer and more, gaining decision-grade insights to make enhancements on the fly.
Better program planning
As organizations design future programs, an avalanche of fragmented data can make it challenging to see where to keep spending and where to scale back. By measuring customer demographics, top SKUs (stock keeping units), channel performance, geography and more in one place, organizations can gain deeper insights and forecast scenarios more accurately. Armed with that information, companies can ensure they're targeting the right segments, plan for smart growth by understanding regional opportunities, and refine incentive structures to make sure programs perform at their peak.
Ferreting out fraud
Unauthorized claims can take a big bite out of a channel marketing budget, yet many organizations struggle to control duplicate, invalid or outright fraudulent sales claims. With estimated fraud in an incentive campaign hovering around 2.5 percent of total claims, an organization that processes 15,000 claims a week can end up wasting $2.5 million a year. A platform that automates claim verification can not only save you from paying out claims unnecessarily, but conserve precious staff time and resources as well. In fact, one study found that for every dollar invested in incentive compliance tools, organizations saved three dollars by reducing fraud and noncompliance.
With multiple brands vying for your team's time and attention, communicating clearly about incentives can help make sure they're promoting your products, rather than the competition's. Instead of sending promotional materials in one batch at the beginning of the year, use technology to push out bite-sized updates on new promotions, product features and other need-to-know details that can motivate reps to sell.
Fewer administrative headaches
Creating reward systems, checking for fraud, circulating documents for approval, manually entering data… it all adds up for your team. An end-to-end platform can help lighten the load, enabling team members to submit sales data in bulk and offering sales associates self-service options to track and manage performance themselves.
With many organizations conscious of the economy's effects to their bottom lines, delivering strong ROI from channel incentive programs is critical. A data-driven strategy can help leaders make sure they're maximizing performance across their teams -- all without spending another dollar on channel marketing.
Jason Atkins is CEO of 360insights.com, a global channel incentives leader offering rebate processing, SPIFF programs, co-op advertising and channel analytics. The company's Channel Success Platform is the first truly integrated software-as-a-service solution enabling brands to optimize their channel incentives spending. Based in Whitby, Ontario, the company serves over 150 of the world's top brands and has expanded to have operations around the U.S. and U.K. For more information and resources on 360insights.com, please visit us here.