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Arming Your Sales Teams for Success – Compensation Strategies

Arming Your Sales Teams for Success – Compensation Strategies. Christopher W. Cabrera CEO & President October 14, 2008. About Xactly. Founded in March 2005 Leader in on-demand sales performance management Target companies with 2,000 or fewer payees

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Arming Your Sales Teams for Success – Compensation Strategies

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  1. Arming Your Sales Teams for Success – Compensation Strategies Christopher W. Cabrera CEO & President October 14, 2008

  2. About Xactly • Founded in March 2005 • Leader in on-demand sales performance management • Target companies with 2,000 or fewer payees • Focused on automating key business processes for finance and sales • Manage over $1 billion + in compensation • World-class management team with 35 years of combined domain experience Pioneering a New Paradigm in Automating Sales Performance. Company Confidential

  3. Experiencing the Benefits Company Confidential Company Confidential 3

  4. Automating the Process of Compensation On-Demand Hosted Repository HR/Payroll Processing Sales Compensation Analytics Product Profitability Analytics Customer Analytics Sales Performance Analytics Company Confidential

  5. On-Demand Sales Performance Management

  6. On-Demand Sales Performance Management Post-Sales Business Data

  7. Territory Quota Sales Comp Reporting & Analytics Credit Assignment Workflow Rewards & Incentives Forecast/ Planning Price Execution On-Demand Sales Performance Management Post-Sales BusinessData

  8. On-Demand Sales Performance Management Commitment to Innovation Current 2009 Company Confidential

  9. Renewal Sales Compensation Challenges for SaaS Companies Paradigm is a subscription model Renewals are the lifeblood of the business The key metric is ARR No SaaS vendor is an island Customer success is THE paramount issue Company Confidential

  10. Subscription Model Challenges & Approaches • How do you pay and keep reps motivated? • Multi-year contracts • Pay on annual contract and defer payment • Must have ability to clawback if customer cancels a multi-year deal • Two teams: • Customer acquisition and customer renewal Paradigm is a subscription model Company Confidential

  11. Subscription Model Approaches Get Creative • Use Non-Cash rewards • Pay on annual contract term & value • SPIF on multi-year contracts • SPIF on discount rates • SPIF on add-on sales Company Confidential

  12. Up-sell-Cross-sell—Referral and Team Incentives: “Drive More Wallet Share” Investments Home Mortgage Savings Account Checking Account Company Confidential

  13. Renewal Renewals are the Lifeblood of the Business Renewals are the lifeblood of the business • You must earn your customer’s business every single year • Separate responsibility of renewals from new business • Reward your customers for referrals Company Confidential

  14. The Key Metric is ARR The key metric is ARR • Challenge is revenue recognition • 3-year deal can only be recognized 1/36 • Determine what your ideal annual contract value is • Must get innovative with compensation Company Confidential

  15. No SaaS Vendor is an Island No SaaS vendor is an island • Build the right ecosystem for the long-term • Compensate based on mutual referrals • Do the integration to enhance the user experience Company Confidential

  16. Integration with Leading On-Demand CRM Apps Company Confidential 16

  17. Territory Quota Sales Comp Reporting & Analytics Credit Assignment Workflow Rewards & Incentives Forecast/ Planning Price Execution BusinessData Company Confidential

  18. Customer Success Is THE Paramount Issue Customer success is THE Paramount issue • Must have a dedicated customer success team • The power shift has moved to the advantage of the buyer • SaaS vendors must focus on renewals separate from sales Company Confidential

  19. SaaS Customers & Lessons Learned • Focus is Customer Success • Hire ‘farmers’ to plant seeds to up-sell and cross-sell • Quantifying contract value for commission payments • Holding & releasing payments based on contract terms

  20. Call or visit our web site to learn more: http://www.xactlycorp.com 1-866-GO-XACTLY Company Confidential

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