Are You Correctly Tracking Incentive Program ROI?

by: Nichole Gunn September 12, 2017

When you implement an incentive program, it’s natural to have high expectations—you want the program to increase sales and the overall health of your business. Most importantly, you want a high return on your investment (ROI). Unfortunately, many incentive or reward program sponsors suffer the same problem: they don’t track ROI correctly. As a result, they shut down the program prematurely or let it stagnate when they don’t see the results they were hoping for.

Incentive program ROI can take a while to build up. Some incentive programs aren’t significantly profitable within their first year. Even with great promotion and a well-organized launch, it can take time for participants to really engage with the program, learn its ins-and-outs, and remember to redeem rewards.

Over time, with word-of-mouth spread, a stellar marketing campaign, and reward trophy value, a well-run incentive program will see those ROI numbers grow and flourish.

So when you’re trying to measure incentive program ROI, remember that it’s not always about cold, hard numbers. Make sure that when you analyze reports and data that you’re comparing it to a group or time frame not impacted by the program.

incentive program ROI For instance, your revenue may be -7% the quarter after you implement a sales incentive program, making it initially seems as if the program isn’t working. However, when you compare participating salespeople’s performance to non-participants, you find that participants brought in a -2% average sales revenue and non-participants averaged -12% sales. That means the sales incentives still increased sales revenue by 10%, even if you didn’t increase sales overall for the quarter.

So if you don’t immediately see the ROI that you were expecting from your incentive program, don’t despair! Try taking a closer look at your data—the results may surprise you.

About Nichole Gunn

Nichole Gunn is the VP of Marketing at Incentive Solutions, an Atlanta-based incentive company that delivers advanced, agile B2B customer loyalty and channel sales incentives programs.