It’s hard to believe convenience store beer can teach us something about sales compensation and strategy alignment, but it’s true. I’ve seen it.

Several years ago a major brewing company hired us to help compensate their driver sales reps according to their new sales strategy. The reps used to be charged with delivering beer to restaurants and convenience stores and basically rotating the stock. Maybe getting the store owner to buy a couple extra cases of 16-ouncers. But the brewing company realized that strategy didn’t get the real customers – the beer drinkers – to buy more beer. So the strategy changed. Driver sales reps now delivered beer, and then also did a bit of marketing. At the front of the cooler display, a rep now made sure his company had products matching competitors’ (if they had 16 ounce cans of light beer, he made sure his company’s 16 ounce light product was right next to it, hopefully with more facings) and the packaging and tags for the week’s specials were clearly displayed. Reps now had a different conversation with the store owner about how the marketing was affecting sales, and the owner listened because it affected his bottom line.

We worked with the company to determine how to motivate the sales organization with performance indicators that could ultimately steer consumer preference. The company moved their sales compensation plan off of a purely volume-based plan and connected it to the metrics and activities that drove beer consumption. They developed performance measures that were focused on merchandising such as the number of facings, the position of the product closest to the cooler handle, the placement of signage in the retailer, the positioning of large displays, and competitive matching.

By understanding what influenced the purchase of beer and connecting it to something that was important to the driver sales rep, the company was able to change the behaviors of the reps and get them to sell more beer. Together the company and the customer saw significant improvement in results, demonstrating the power of sales compensation and its connection to the sales strategy.

What Your CEO Needs to Know About Sales Compensation will be available in bookstores and on Amazon.com and Barnes & Noble.com in January 2013. If you would like to pre-order a copy for a discount, email me at cparker@salesglobe.com and I'll send you a sample chapter!

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