Who Should You Target With Your Incentive?

B2B incentive strategies aim to engage business clients and reward them for reaching goals or achieve specific industry-based criteria to solve sales and marketing challenges.  

But who exactly in your distribution channel should your incentive program target? 

There are two parts to the answer. First, consider that a big mistake about incentive and reward programs is to think they are silver bullets that make people sell more or do what you need them to do. 

When this is the belief, there’s a tendency to quickly think of an awesome reward and launch an incentive targeting everyone. For example, it’s easy to think everybody wants to go on a trip… or easy to assume everybody will want to earn and accumulate enough points to redeem rewards from your program catalogue.

This could quickly turn into disappointment when you notice that three weeks after your program launch, a large portion of the participants have failed to engage – they have never logged in to see what the program is about. And even worse, two months into the program, only 18% of participants are on track to meet objectives.

Understanding business clients 

One of the reasons for disengagement is that B2B incentive and reward programs are (without knowing) often designed to appeal only to a certain segment of your customer base. They are not applicable to everyone and too often only reward the most profitable customers. 

What about your potentially most profitable customers? Or the bottom 10% who are the hungriest businesses to earn rewards? These businesses cannot afford to let go of any little earnings that they can make. 

Understanding which business clients have the highest impact or contribution to meet your program objectives (in other words: who brings what) helps define your strategy. Most importantly, it helps you establish how you are going to segment and engage each customer. 

Say the common 20% of your customers contribute 80% of profits. Too often incentives and rewards, perhaps in an effort to be fair, target all participating businesses in the same way. The risk in a program like this is that the glove that fits everyone, in the end, fits no one. 

We don’t want to reward everyone the same way. And we don’t want to reward participants for what they were going to do anyway. That’s a waste of money. We know the top twenty percent are already engaged – they’re the highest contributors, and they always win the rewards.  

Keep them engaged and yes, reward them, but also segment your strategy. It should be geared to engage and drive the next twenty percent. The incentive then is likely to move this segment from a medium contribution level to a higher contributor segment which brings better results to the business and, if you design your strategy well, it could do so in a more cost-efficient way.  

Identifying key people  

Now that we know how we are going to engage distributors and channel partners, we also need to identify who is personally going to participate in the program.

Most of the time we intuitively know the answer and know who to incentivise. However, there are things to consider before we jump straight into rewarding the obvious candidates. Every person in the business has a different role, and incentive programs normally target participants based on the responsibilities of job titles. However, the key is identifying high-value participants.

High-value participants, in this case, are not those who bring more profit, but those who are prone to welcome the program and engage to achieve rewards. They are the people that will drive and ensure your program goals are met. Their value comes from their engagement levels – engagement results in the gains and returns your incentive has set to achieve.  

Each company will have high-value individuals and, based on the unique program strategy of your program, they can be those who can influence others to act, or the actual person that acts and need to change certain behaviours. A wise program strategy identifies whether you are going to incentivise and reward influencers, actors, or both.

For instance, say the behaviour you want to change is “to recommend or specify your product over the competitor’s”. The business owner or dealer principal may direct sales managers and reps to do so. However, his business makes money whether they sell your product or the competitor’s, but sales managers may be willing to recommend your product. If there’s something in it for them, they will ensure their sales reps push your product.

But if your challenge is not that and the objective of your incentive is to increase sales directly through you and build relationships with your reseller network, then you cannot miss rewarding dealer principals and business owners and reward them for the changes they need to do in their business to make things happen. Like any marketing strategy in your business, targeting and segmentation are just as important in B2B incentives. So, it’s important to identify which businesses you will target as well as individuals to drive your program. Failure to consider these will miss your program objective and ultimately its ROI. 

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