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Given the current environment, what are revenue and sales compensation leaders contemplating, what actions are they taking, and what peer guidance do they have?

On August 18th and 19th, Alexander Group held the 2020 Media Sales Compensation Symposium, drawing over 100 media revenue and sales compensation leaders to discuss challenges and how to respond to recent market conditions. Leaders from media organizations shared their approach for realigning sales compensation programs and goals for the remainder of 2020 and into 2021.

Real-Time Sales Comp Considerations

A polling of symposium attendees revealed that 50% expect to make wholesale changes to their 2021 sales compensation plans, with another 20% unsure of what they will do. In addition to evaluating the design of sales comp plans, 55% of attendees rated assigning annual sales targets down to individuals as their top goal-setting challenge for 2021. The president of sales for a leading OTT/CTV ad platform company captured the spirit of the current situation best. “Now more than ever, we need to make sure our sales compensation plans and goals are properly designed so that we can assure people that sales is still a good job.”

With a high degree of change and much uncertainty on how to cascade topline targets down to reps, the Media Symposium was a venue for Alexander Group Media practice leaders and attendees to discuss current challenges and provide strategic guidance.

Three key themes were identified:

1. Model the Unknowns

Modeling how sales compensation changes will impact the company’s bottom line and seller wallets is more important than ever. A few scenarios to consider include:

  • What happens if the economy tanks
  • What happens if the economy takes off sooner than expected
  • What happens if economic conditions skew performance to one measure and away from others (e.g., growth solutions vs. legacy products)

Once aggregate and incumbent-level impacts are understood, leaders then need to prepare an action plan for each potential outcome and align on the metrics that will indicate which scenario they are in, before it becomes a problem. In addition, determining how to set expectations in advance is critical to prevent putting revenue and sales talent at risk.

2. Adapt Goal-Setting and Allocation

The EVP of digital sales at an integrated print and broadcast media company described goal-setting in the current economic climate as “an effort to neutralize highs and lows to individuals and the company and ultimately provide reasonable goals that people can influence.” Under normal conditions, goal-setting would involve evaluating historical account performance, overlaying growth expectations and ensuring alignment with the topline target. Given current market conditions, leaders must now agree on a global number, share it with their team across varying levels, leverage analytics to baseline the trending of accounts, while ultimately treating the delta between the bottom-ups and global number as a “negotiation.” This negotiation reflects the pivoting that teams will need to do as market conditions evolve. Equally important to this process is ensuring effective communication through properly training the trainer and providing insight into the goal setting and allocation methodology.

3. Operate as a Sales Compensation Partner

Given the high degree of impact sales compensation programs have on sales productivity and performance (arguably the most critical function during times of market disruption), the role of the sales compensation professional must evolve. To do so, leaders must expand their scope and work as functional partners, not just as sales comp specialists. While many functions in a company work in silos, sales compensation cannot. To effectively drive change and ensure that comp is aligned to the company’s strategic direction, sales compensation professionals must connect the dots between sales, finance, marketing, product, HR and other functions to ensure business priorities are balanced. The global head of job design and sales compensation for an emerging pure play digital media company noted, “In order to drive the right sales compensation strategy, you cannot be insular and you need to proactively engage not only with sales, but with HR, talent and sales operations to help craft your organization’s revenue growth strategy.”

Additional topics discussed during the Media Symposium include:

  • Ensure sales compensation success for evolving media organization structures and roles
  • Design and manage a sales compensation governance structure
  • Understand 2021 sales compensation priorities
  • Align sales compensation design for uncertain times in media
  • Adjust quota setting while managing expectations
  • Consider other levers to attract, develop and motivate a top-tier media ad sales team

Missed the action? For a debrief of highlights from the Media Sales Comp Symposium to help inform your 2021 sales comp planning, please complete the form or contact an Alexander Group media sales practice lead.

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