Lift: The impact of more immediate rewards

Author: 
Tim Houlihan

Years ago, television ads for cheap products advertised delivery times of four to six weeks. Today, Amazon can deliver some products the same day you order them.

Our brains love immediate gratification. Getting something today is better than getting it tomorrow, which is better than getting it next week. This is, in part, because of temporal construal. Having a concrete and immediate reward is better than a reward in the abstract sense.

Just as getting immediate feedback on a sales call is better than waiting two months, so, too, is being rewarded for an achievement on the same day or week it is accomplished rather than waiting months.

Too many reps have told me they received rewards on a debit card but had no idea what they did to earn them. By the time the rewards reached the reps, the achievements were abstract memories. Rewarding (and communicating) in a timely fashion helps link the achievement with the reward and makes it more concrete.

How quick is quick enough?

How quick should rewards come to those who earn? It depends on the length and complexity of the sale. Reps that work in call centers with quick-turn sales, daily sales goals and hourly sprints should be rewarded no later than weekly. Pin the tail on the donkey NOW! For outside sales reps on routes where objectives tend to be structured on a monthly basis, rewarding monthly is best – and near the end of the month. For all companies that focus on quarterly objectives, rewards should be delivered with 10 business days of the end of the measurement period.

In some industries, it’s unavoidable to delay rewards. Pharmaceutical companies reward reps for market share changes that are only fully calculated 45 days after the quarter ends. In most selling environments, calculating the revenue, units and even profitability can be done quickly and delivering rewards in a timely manner is simply better.

Here’s a psychological bonus for managers: When reps are aware of what they did to earn a particular reward, they are more likely to replicate that behavior – the key reason you wanted to reward them in the first place.

Don’t let accounting departments sell you on waiting three or four weeks for the sales data to calculate the rewards. The timeliness of rewards should not come at the whim of your accounting department. Your reps will appreciate being rewarded right away and you will benefit from linking the reward to the action.

Temporal construal at work again!