One of the most often examined metrics in any organization is customer retention, but have you ever considered the retention rate of your sales reps? Your sales team is one of your most valuable assets, and if you think about it, it’s your sales reps that earned you your customers in the first place.
Turnover Can Cost Over $100,000
According to CSO Insights, the average turnover rate for sales reps across all industries is 25 percent. That’s nearly double the rate for any other position. Furthermore, another study found that at any given time, approximately 68 percent of reps plan to look for a new job within one year.
Obviously rep churn is a significant issue, and while it can cost you valuable talent, it can also cost you monetarily. Salesforce states that the average cost of replacing a single sales rep is $115,000. DePaul University found that $29,000 of that is from acquisition costs, $36,000 from training, and $50,000 in lost sales.
How to Increase Rep Retention Rate
So how do you keep your best reps? There are four main factors in sales rep retention: satisfaction, engagement, growth, and compensation. Reps need each of these elements to be fully realized to feel completely involved in their work.
To keep your reps satisfied, engaged, and happy, you must:
Make sure reps feel supported by the rest of your organization
Your sales reps are a valuable resource, you should make them feel that way. After all, how much revenue would you have if no one sold your product? Ensure that your sales and marketing teams are closely aligned — marketing should not only provide quality leads, but also produce materials and resources to help sales succeed. Fact sheets, case studies, and other high quality content can be extremely valuable during the customer journey the sales process.
Lakesha Womack suggests that you connect your sales and product teams. Sales reps talk with current and potential customers about your products every single day. They hear about competitors, discuss use cases, and address concerns. When you connect them with the product team, it helps reps feel involved in the actual product they are selling, and they can provide important insight that will make your product even better.
Give reps sincere, honest feedback
By nature, sales reps are direct people. They also spend all day trying to figure out what prospects may need and are often lead through an arduous process to get a sale. When you work with your reps, give them direct, honest, truthful feedback.
This does not mean that you should be harsh. Be clear and specific about what they are doing well and what you would like to see them improve. Furthermore, set clear goals, define key objectives, and create an explicit plan to achieve them.
We also all have a tendency to make one-on-one meetings about numbers and pipelines. Instead, these meetings should be behavior and strategy oriented. Look at what your reps need, what their plans are, or even just have them talk through how they hope to accomplish a specific sale.
Call recording and annotations are both ways to make your one-on-one meetings more effective. You can review calls and provide feedback outside of meetings so your reps get more timely feedback and you free up time to discuss strategy rather than nuanced details.
Invest in your reps
An excellent way to increase your sales rep retention is to invest in a sales coaching program. Instead of asking your reps to do more for you, do more for them. Give them the skills they need to perform better and let them put those skills to work for you.
You can also purchase tools to help increase your rep’s productivity. When you eliminate administrative tasks, you free up reps’ time so they can sell more. You can implement dialers that automatically record activities, or streamline processes like note-taking or voicemails to significantly increase efficiency.
Grow your team from within
A great way to increase sales rep retention and increase employee happiness is to promote from within. The Harvard Business Review even found that one of the top motivators is progress.
Get to know your reps and their career goals. If your organization can help you reps make progress toward those goals, they will be happier and likely remain with your organization longer. Promotions and new responsibilities are also an excellent way to maintain your A-players and allow them to teach and groom newer reps as they join your team.
Compensate them fairly
It should come as no surprise that compensation is one of the largest factors in retention. This doesn’t mean that your salaries and commissions don’t have to be overly large, however. Pay reps fairly and structure your compensation plan so that you directly reward the actions that contribute to success.
Implementing an analytics platform that provides visibility into metrics like dials, connection rates, and contacts-to-close allow you connect particular activities with outcomes, and then reward reps for performing those activities. If your compensation plan differs from your sales plan, then reps have no incentive to follow them and will become frustrated if they are not incentivized to perform the activities that lead to a success.
Get serious about onboarding
The first 90 days at a company are crucial to a rep’s success. Don’t simply dump them onto the sales floor after two weeks of training (or less). Reps should go through a complete onboarding process, and continue with regular coaching after. It’s important they are supported during their first six months with your company. Even if you feel like you are hand-holding at first, your reps will ramp quicker and contribute more after you’ve developed a solid foundation.