Among the many changes facing news media organisations are shifts in the way sales compensation plans are managed. As the year draws to a close, reviewing your media sales team’s compensation plan is one way to improve your outlook for 2024, and during this week’s Webinar, INMA members heard about some of the trends and factors influencing sales compensation plans.

A comprehensive checklist: Optimise your media sales team’s compensation plan, presented by Igor Uroic and Matt Bartels — principals and media and consumer practice leads of the management consulting firm The Alexander Group — began by explaining some of the key drivers of changes in compensation planning.

“Almost 90% of organisations are making some type of change to their comp plans,” Uroic said, adding that typically such changes are made when companies are changing to scope of jobs, what’s happening in the marketplace, or what is being done strategically within an organisation.

“If one of those things changes, then it would necessitate a review of the overall account programme. I would say for most organisations, all three of those things are changing,” Urioc said. And that calls for companies to look at how their pay structures align with the jobs they’re asking to be done and the organisation’s objectives.

Preparing for 2024

As the new year approaches, Urioc and Bartels noted that “some core macro trends that are affecting businesses at large” should be looked at through the lens of how they affect sales compensation structures.

One of the biggest reasons for companies to reconsider their compensation plans is that it remains a leading factor in why candidates accept job offers — and also a big reason they leave.

In recent years, other factors have gained more weight in helping retain employees; factors such as reputation, promotion, opportunities, culture, and company initiatives are appearing more frequently, Urioc said.

“The important thing that we’re trying to highlight is that having an attractive compensation plan still remains one of the core components. So whether folks are coming or leaving your organisation, the ability to fine-tune and hone your programme is really critical.”

5 trends to watch

Five key trends are impacting businesses and sales compensation plans, Urioc said:

1. AI and digital transformation. This is obviously a hot topic. As new AI solutions are emerging, organisations are exploring the use of AI in sales compensation. The Alexander Group’s annual Hot Topics and Trends Survey looked at what impact AI will have on such things as evaluating performance and setting goals; it found that most organisations are still unsure of how this will affect them.

“What we’re seeing for the moment is that most are saying [they’re] actually quite unsure or think that there is low to no impact on most aspects of that,” Urioc said. However, many are looking at how AI can help them from the analytics side, such as to help them set better target goals or run their programmes differently.

2. Market uncertainty. Despite market uncertainty, most organisations are increasing their yearly sales compensation budgets. However, fewer organisations are projecting their sellers to be at or above goals.

“The thing to remember is that the vast majority of companies are staying flat or increasing. So if your organisation is doing something different, you need to be aware of what that means for you potentially as you’re trying to recruit talent,” Urioc said. 

3. Employee centricity. Today, there is a shift toward more employee-friendly experiences, including flexible work arrangements and simplified leave of absence policies.

“Flexibility and employee engagement are really shifting both inside and outside the organisation,” Urioc said, pointing to how many are looking at a permanent hybrid work model. That could be used as a valuable recruitment tool: “When we think about sales compensation, it’s one aspect of an overall package that an individual gets attracted to the organisation.”

While compensation remains the top driver for employment, more workers are starting to consider their work arrangements as a major factor in whether they will take a position. As a result, organisations are reevaluating their coverage roles and compensation structures to align with employee needs.

4. Customer experience. Organisations are focusing on improving customer experience and building stronger relationships. This is reflected in sales compensation plans, with roles such as customer success managers being included in some incentive plans.

5. Sustainability and corporate responsibility. There is a growing emphasis on sustainability, corporate responsibility, and other macro trends in sales compensation plans. Organisations are considering profitability metrics and aligning their plans with their culture and client expectations.

Given the many changes occurring throughout all industries, Bartels said that sales compensation is more important than ever. It’s also more complex, making it imperative for companies to get it right.

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