(Excerpt from Sales Management Simplified by Mike Weinberg)
All sales dollars are not equal
… capturing a new dollar of sales is way more valuable than recapturing an existing dollar of sales. Can we agree that if revenue growth is the primary goal of the sales team, then a new dollar sold is not only more important, but also a better measure of sales effectiveness and worthy of higher compensation? And if we can agree on that, doesn’t it make infinitely more sense not to commission all sales dollars the same, but instead to pay more commission for a new sale and less for an existing sale?