This is a question about business partner loyalty rather than customer loyalty. How effective
are spifs (individual incentives aimed at salespeople or system engineers) in building
and sustaining business partner loyalty? The incentive could be cash or merchandise. What are
the "gotchas" for vendors investigating spif programs for increasing channel loyalty?
Generally, spif programs are tactical, cattle-prod oriented affairs, with high pressure, short accomplishment periods, and big stakes. Sometimes, if they are also too convoluted, sales people won't pay them as much attention as the spif programs where the rewards are obvious, attainable, and attractive.
If you're asking whether most spif programs build true sales person/staff loyalty, the answer is a pretty consistent NO. Spif programs are like retail loss leaders. They're designed to get attention, not create long-term supplier value and advocacy. Suppliers, if they want sales person advocacy on their side, have to determine what it takes to merit that advocacy. In other words, they have to partner with sales people in designing the program in the first place.
This was first published in July 2002