Your sales team is smashing targets, closing deals left, right, and centre. 🎯

Revenue is pouring in, and everyone’s celebrating. But a year down the line? The customers they onboarded aren’t sticking around. Churn rates climb, and those shiny sales numbers quickly lose their glow.

One of the culprits? Mismatched compensation structures.

Most sales people are rewarded for closing deals, not for ensuring those deals succeed long-term. They’re incentivised to focus on getting contracts signed, not on building relationships that lead to five-year renewals. While this approach might hit short-term revenue goals, it often leaves a business grappling with customer churn, a damaged reputation, and wasted opportunities.

It’s time to rethink how we compensate sales teams. Let’s unpack the problem—and, more importantly, explore actionable solutions.

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The Disconnect: Sales Incentives vs. Business Goals

Sales commissions typically reward the “yes”—the ink on the contract. But this hyper-focus on short-term wins can create unintended consequences:

• High-pressure sales tactics that bring in poorly qualified leads.
• Overpromising and under delivering to close deals.
• A lack of ownership for customer satisfaction once the deal is done.

Meanwhile, your business thrives not on initial deals, but on long-term, happy customers. Retention is cheaper than acquisition, and loyal customers generate consistent revenue. So, how do you align short-term sales goals with long-term business success?

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3 Tangible Ways to Align Compensation with Retention

1️. Tie Commission to Customer Retention

Create a split-commission structure. For example:

• 70% upfront, based on deal value.
• 30% delayed, awarded only after the customer renews at least once.This rewards salespeople for finding quality clients, not just quick wins.

2️. Incentivise Cross-Functional Collaboration

• Introduce bonuses for handovers to Customer Success teams that meet a clear standard.
• Reward sales reps when clients hit key milestones (e.g., product adoption or satisfaction scores).This fosters accountability and collaboration beyond the closing handshake.

3️. Incorporate Long-Term Metrics

Measure sales team success not just on revenue but on metrics like:

• Customer lifetime value (CLV)
• Churn rates for their deals
• Net Promoter Scores (NPS) of their accounts

By looking beyond the initial sale, you incentivise behaviours that benefit both the customer and your business.

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The Cultural Shift

Compensation changes are one part of the puzzle. Equally important is the mindset shift. Encourage your team to see themselves not as deal-closers but as customer champions:

• Provide ongoing training on customer-centric selling.
• Build feedback loops between sales and post-sale teams, so they can learn what works (and what doesn’t).
• Celebrate customer success stories as much as closing deals.

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The Payoff

When salespeople are incentivised to think long-term, everybody wins:

• Customers feel valued and supported.
• Sales teams build trust and meaningful relationships.
• Your business enjoys sustained growth and fewer churn headaches.

So, here’s the question: are your incentives building a bridge to long-term success—or burning it down? 🚀

💬  How do you handle sales compensation in your business? Are there any struggles you can’t find solutions for? Get in touch with our team here to learn how we can help!