Let’s start with a challenging question. How much time per day do you spend thinking about your comp plan and making sure you have a strategy to hit your this bonus or that percentage or whatever. How much do you think about how you have to find that next business builder and thinking about the people you know that you know would be a great business builder, and now you just need to figure out how to talk to them about it? Ok, have a figure in your head?
Now think about how much time in a day do you envision the better life your customers will have when they own and use your product consistently. Did they save precious time so in this hectic culture and they have 30 more minutes a day to read books to their children? Did they lose those stubborn 10 lbs and now are no longer a diabetes risk? Are they now so full of energy and one year from now they are promoted at work and have a wide open career path ahead of them? Do they feel more confident out in the world and are now oh so close to finding the love of their life because they love who they see in the mirror? Ok, now you have a number. Which number is higher? Which do you think about more? Your comp plan or the dreams achieved with your product solving people’s problems.
When you are starting your business, it’s dangerous to focus too much on your comp plan. We know that money is not the true motivator for everyone. Every single one of my clients moved into their company because they wanted to change lives, so why is it that the comp plan comes up in almost all of my coaching conversations? What about changing lives? It all gets very confusing. I want you to stop thinking about your comp plan. It will all fall into place.
Here are the dangers of thinking too much about your comp plan.
1. You start to see people you know as dollar signs
2. You worry about who can afford monthly orders of a certain amount or more, and you start pre-judging everyone
3. You put such a high focus on finding builders that you ignore the natural progression of how someone becomes a force in the direct sales industry
4. You lose confidence and think that you cannot do this because you aren’t doing the math properly
5. You totally overwhelm anyone who might want to do the business with that super complicated comp plan, and you set them on their own version of dangers 1-4. So then they don’t want to do it, or they stink because they are a head case too. You tell them this is normal to be a head case.
News flash! There is a better way to live this life. Just serve people and the money will come.
There are two foundational principles that will help you overcome these dangers and get back to living your passion, and doing well again. Salespeople that think about money never succeed so you have to get that comp plan out of your head asap. First a Zig Ziglar quote, “you will get everything you want when you help enough people get what they want.” Second, you need to play the math out when you are making your own plan for your business. All the people who get the results rewarded by the comp plan forget to tell you about the missing piece of the puzzle: the high amount of activity they have in order to find the gems that they are rewarded for. If you need a certain number of $100 orders, for example, you have to fully reverse engineer these numbers to how many total appointments you need to do for the month. Then put your comp plan away and get to your revenue generating activities. Some will be sales, some not. Some low orders, some not. Some will just order, some will want to build. Some will order once, and some will repeat a larger order next month after falling in love with the product. At the end of the month, it will work out, if you did the amount of appointments necessary. I’ll explain this more after I explain why focusing on your comp plan is losing you sales.
Let’s explore each of these dangers together, the truth behind them, and what you should do.
Danger #1: You start to see people you know as dollar signs.
This is SO dangerous. Remember how when you first started you only thought in terms of how this product would help people? And the people you knew were the first that came to mind? Adding in the comp plan to your thinking is deadly because it makes you feel weird. Then when you approach them, you try to compensate for this. This makes you act like a weirdo. Now your friend thinks you are a weirdo, which is the opposite of what you wanted to happen. Oops! You also overall feel uncomfortable with this approach as it violates your values. So you question whether or not you can live your life that way. Then you decide you don’t want to sell to people you know. All because of your obsession with your comp plan versus serving and attempting to solve the problems of the people you love the most.
Danger #2: You worry about who can afford monthly orders of a certain amount or more, and you start pre-judging everyone
Your bonuses are based on orders of $100 or more. And you need to have a few of those in order to hit the bigger bonus. So you start adjusting your strategy on how to get these larger orders. You start to see people in terms of big orderers and small orderers. But that’s not how people order. They come in waves. You also may find yourself stopping nurturing certain customers due to their order size. You also look at people and think, “Who can spend $150 per month?” and you exclude people from your potential contact list based on this. Less appointments leads to less overall sales. Oops. Also being a jerk leads to less overall sales. Double oops.
Danger #3: You put such a high focus on finding builders that you ignore the natural progression of how someone becomes a force in the direct sales industry
There is kind of a lifecycle. It is unlikely for someone to want to start a business if they don’t understand the product or are not in love with it. Most people first fall in love with the product. And as they are loving it, they start thinking of people who need it also. Then they think, “hey, I would be happy if all I did all day was talk about this product because it’s amazing.” The love for the product is a huge component that will make your team member successful. If you go in too strong with business, and don’t start with solving problems through the product, it is likely to be less powerful than just doing a sales appointment and bringing up business opportunities once they order. So now you have customer acquisition and retention issues. I’m pretty sure you need more builders AND customers in your organization, right?
Danger #4: You lose confidence that you cannot do this direct sales thing because you aren’t doing the math properly
I’m going to give you a concrete recommendation at the end today. Let me give one example here, because repeating the concept will help it click. According to one comp plan I understand, to get the bonus, you need three people to have a loyalty order of $100 or more in a given month. If you think that means you need three customers, your math is wrong. If you count on the same three people to make this order every month, you will be stressed out and fail. You need to do the math to figure out what percentage of people order over $100. Sometimes people will order nothing, sometimes $50, sometimes $120. I have heard clients who have their special three people but then one doesn’t order and everything goes to hell quickly. Stop depending on three. Give yourself some wiggle room. In order to get repeat business, you need to know their overall goals, what they already have, and what else they need to reach those goals. They need to be nurtured and you need to offer to help them with that order. Then do this with eight people. Some will say no, some will do it, and you will get your three people to hit your bonus. You need eight people. Or maybe in your business it’s 11 people. Or maybe it’s just five. You will need to figure this out. Obviously the best way to get these big orders is to find builders, and I’ll cover that part last. It’s so simple you will just smack yourself in the face for not realizing it earlier.
Danger #5: You totally overwhelm anyone who might want to do the business with the super complicated comp plan, and you set them on their own version of dangers 1-4
Now we have gone over the dangers of obsessing over the the comp plan too early in your business. The cycle stops with you! Don’t pass it down to your next person. At first, focus on what is right in front of them, which is probably just commission off new customers and product incentives. As they get closer to the next level, explain that one. Don’t freak them out. As someone just learning about the business the details are super confusing. Follow this format and you should be good to go. Ask, “what is your monthly income goal? Ok, great, that is ____ level and it takes about ____ months to reach of someone who is working part-time. How does that sound?” The first thing we need to do is get your first ten customers, let’s do that first, and practice your sales conversation so you will feel comfortable and then we can focus on reaching bonuses? How does that sound?”
So now you are thinking, “Ok Tasha, I’m never looking at my comp plan again! Woo hoo!” No, that’s not what I’m saying. Let me clarify. I am not opposed to you understanding your comp plan. I am opposed to you pouring over it every day and obsessing about how you are going to hit bonuses instead of how you are going to help people.
In my research of a couple different companies, I got these stats and I’m sure they hold true for your company as well. 85% are product users, and 15% are business builders. I know, you know that. But what does that mean about how to be successful? Your comp plan bonuses are based on the success of your team. And again you say, “Tasha I know that, which is why I need to find builders NOW!” So here comes the phrase everyone hates to hear but knows is true. It’s a numbers game. You need the other 85% and they are just as much a part of this story as the builders. Your search for the unicorn fairy builder that will make all your woes disappear is futile.
You will find those builders in the midst of customers and people will surprise you.
This is what you need to do: find seven customers. Out of seven people that buy your product, you will find at least one builder! To make seven sales you probably need to get in front of 14 people. Use a combination of 1-on-1s and events and get to that 14 as soon as possible. And you will come across those builders. That’s how everyone else hit it. They just didn’t explain it to you.
Each no sale, and each person that says, “just the products for me” is closer to someone choosing to build. Everyone matters! If that is happening, you are right on track. If it’s not, you need to change what you say. If you want three builders this month, triple the number of people you meet with. It’s that simple.