The Do’s and Don’ts of Biopharma Contest Design
Next to a sales compensation plan, no activity motivates a sales force more than a contest. When designed correctly, a contest is a useful and cost-effective way of creating excitement and action around a particular product or activity that a biopharma company would like to emphasize. However, too often, contests are not able to adequately motivate the sales force, whether it is because the contest has run for too long, the contest is a mere extension of the sales compensation plan, etc. This blog post will examine how to design a contest that energizes the sales force while not detracting from the sales compensation plan, and keeps all representatives engaged for the entire duration of the contest.
Purpose of a Contest
The purpose of a contest should be distinct from and complementary to the purpose of the sales compensation plan; the contest should not promote the same objective as the plan, nor should it detract from the plan. Below are some objectives that would be met quite well by a contest:
Create excitement around a product that is not part of the sales compensation plan or has a low weight
Energize a sales force that has become complacent with the same products & sales compensation plan
Create excitement for a new indication or new managed care contract
Emphasize a strategic activity that is not part of the sales compensation plan (ex. getting new prescribers)
Leverage the excitement caused by a new DTC campaign
Create added attention for a seasonal product such as cold medicine
Of the various cases listed above, the first case is the most underutilized; rather of giving a low weight to a less important product in a sales compensation plan, the product might be better served if it were removed from the plan and promoted with a contest instead. A contest generates much better return for the cost.
Timing and Frequency of Contests
How often and how long should a contest run? Guidelines for contest timing and frequency are outlined below:
Having contests run for more than six months detracts from the uniqueness and excitement of having a contest, and oftentimes causes the contest to become stale. Furthermore, if contests are run continuously or back-to-back, then their awards become viewed as an expected part of the sales compensation plan.
Individual or Group Contest
While group contests in which representatives compete as a group can be effective, especially if the activity is one in which representatives can learn from one another, individual contests are the most effective. The more direct control representatives have over their own rewards/compensation, the more motivated and energized they are.
Number of Winners
In order to keep the entire sales force engaged throughout the duration of a contest, the contest should be designed such that as many representatives as possible have a chance of winning for as long as possible. If numerous representatives are eliminated from having a chance to win a contest early on, then the contest will not be as effective because so many representatives will not be engaged for the entire contest period.
Furthermore, the longer the duration of the contest, the greater the number of winners should be. If a contest requires several winners because it is being run for a long period of time, then it should be designed such that different awards are earned for different performance levels (i.e., the top 10% earns a grand prize, the next 15% a secondary prize, etc.). Such classifications ensure that even low level performers have a chance to move up classes and thus stay engaged in and excited about the contest. However, broad classifications that cover a wide level of performances mean that late into the contest, a representative may be unable to move up and thus may disengage.
Contest Award
Similar to the number of contest winners, the longer the duration of the contest, the greater the total amount of awards should be. In addition to the size of the total amount of awards, the top award should be rather large in order to generate an adequate level of excitement for the contest.
Critical to any contest is the recognition of the contest leaders and eventual winners. As such, it is very important to recognize and publicize the leaders of a contest throughout the contest period no matter the size of the contest award. The recognition element of a contest is as important as the prizes.
Summary of Contest Do’s and Don’ts
Let’s summarize the do’s and don’ts of designing a contest:
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Do's of Contest Design |
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DO have as many winners as necessary to keep representatives engaged for the duration of the contest period
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DO recognize leaders and winners while the contest is running
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DO have the contest run for a short time to keep everyone engaged
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DO promote the contest before it begins to generate excitement and attention
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Don'ts of Contest Design |
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DON'T duplicate the purpose of the sales compensation plan or its performance metrics
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DON'T run a contest for so short a time period that there is no ability to recognize leaders throughout the contest
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DON'T have contests become an expected part of sales compensation
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DON'T repeat a contest too often or too soon because it will lose its excitement
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Conclusion
When contests are designed such that the purpose, timing, frequency, dynamic (group or individual), number of winners, and awards work together to create and maintain excitement and action around a particular product or activity, they have tremendous ability to drive behavior without taking attention away from the sales compensation plan. A properly designed contest complements the sales compensation plan and does not function as a mere extension of it. When designed properly, a contest can be a very cost-effective way of driving a particular set of behavior from the sales force. Request a free consultation with us to get started on designing the optimal contest for your sales force!
