Commissioning Your Outbound Prospectors for Demos Set Only? Eek!

There are a number of different commission structures that can be given to outbound prospectors (i.e. someone whose SOLE responsibility is generating qualified leads for sales reps to build their pipeline).

However, if you are ONLY paying your reps based on number of appointments or demos set for the sales reps you are likely to run into some quality issues.

 

And lets be serious, if your outbound prospecters are passing along junk, not only are your sales reps going to be wasting their time, they will begin to take appointments/demos less seriously — and then what happens when there is actually a legit, hot qualified lead? It may get overlooked. Kind of reminds me of the story of the boy who cried wolf — the outbound prospector who cried qualified lead, I guess we could call it. God, I’m a dork.

Below is an example of a commission structure that OpenView has recommended to some of the outbound prospecting teams in our portfolio. This particular commission is paid out on a quarterly basis (although I think paying out monthly is a good strategy for most). You’ll notice the goal is 60 appointments for the quarter, 13 of which convert to TRUE opportunities via the sales reps — in other words, they are able to gather the whole kit and caboodle: Budget, need, timeframe, authority.

In this template example, the commission is uncapped — set more than 60 appointments? Get paid out at $50/appointment infinitely for the rest of the quarter. Set only 19 appointments in 90 days — you get $0. Harsh? Sure, but it’s also harsh for you as management to be paying base salaries, benefits, etc. for your outbound prospectors only to see them hit just 30% of their goal!  And from what I’ve seen, our portfolio companies pay some damn good base salaries for this type of role.

Even if you think the template below wouldn’t resonate well with your team (like I said earlier, different strokes for different folks), I still think that paying based on appointments AND opportunities created from those appointments (and putting a higher value on the latter), will get you much higher quality.

What compensation structure has worked well for your outbound prospecting team? Do you pay based on appointments or opportunities? Or both? What are your thoughts on giving outbound prospectors a small chunk of change when a deal actually closes? Would love your thoughts!

Partner

Devon McDonald is a Partner at OpenView, where she sits on the firm’s investment committee and oversees OpenView’s Growth team, a group of Research, Sales and Marketing Strategists responsible for helping its portfolio companies acquire more customers and scale at an accelerated rate.
You might also like ...
Startup Strategy
We Explored 3 Product Positioning and Branding Failures. Here’s What NOT to Do.

B2B brand and product positioning will only continue to become more important with the rise of the End User Era.

by Margaret Kelsey
Leadership
Predictable Pitfalls of Founders and How to Avoid Them
Editor's Note: This article originally appeared in People + Strategy magazine here. We have romanticized founders having their “eureka” moments, writing their...
by Alisa Cohn
Startup Strategy
The Simple Secret to Getting Ahead in Tech
A couple of weeks ago, I read a fantastic article in the Wall Street Journal about Leyla Seka’s rise through...
by George Roberts