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Compensation for SaaS Sales Organizations
winningbydesign.com
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Linear Model: In this case, the SDR is closing 30 deals per year with a 1:5 win rate (this is the norm in SaaS sales vs. 1:3 in perpetual sales) which equates to 150 leads per year. $40,000 divided by those 150 leads equals $267/SQL, or rather $250/SQL. As the SDR generates 12 SQLs per month, that will equal $3,000 in commission. This also means that for every deal won at an ACV of ~$30,000 at a 1:5 win ratio, you will have to pay for 5 SQLs, which will cost your company $1,250. “it is common to pay an external firm $500 for every meeting generated and $1,000 for every meeting set with a decision-maker.” Accelerated Model: You can use this model to drive behavior toward qualifying the right deals. Plan to spend $1,250 for 5 SQLs since this is what the business model states above, but pay less per SQL. For example, $150 instead of $250 each. That means you will pay $750 total for 5 SQLs @ $150 each, which leaves you with $500 remaining, so you can now pay out $500 for every deal closed. In this case, you end up paying the same amount but drive behavior to identify quality SQLs.
Compensation in Sales Positions “The first step in providing fair compensation to each customer-facing role in your SaaS sales organization is the analysis of the following positions, duties, and experience required by each:” Sales Development Rep (SDR): Prospecting. Positions may range from a first SDR job (Junior) who is focused on inbound sales to a Senior SDR with one to four years of experience who calls on key accounts (Account Development Rep).
The first step in providing fair compensation to each customer-facing role in your SaaS sales organization is the analysis of the following positions, duties, and experience required by each: “Sales Development Rep (SDR): Prospecting.” Account Executive (AE): Sales Acquisition, also known as a Sales Manager (SM). Positions may range from a first AE job (Junior) to an AE with three to five years of experience (AE), or four to eight years of experience (Senior).
“Companies should consider how to structure base and variable pay and then set forth the responsibilities of the role and the terms of compensation clearly in a sales incentive plan.” Compensation in Sales Positions
Compensation in Sales Positions “The first step in providing fair compensation to each customer-facing role in your SaaS sales organization is the analysis of the following positions, duties, and experience required by each:” Sales Development Rep (SDR): Prospecting. Positions may range from a first SDR job (Junior) who is focused on inbound sales to a Senior SDR with one to four years of experience who calls on key accounts (Account Development Rep).
The first step in providing fair compensation to each customer-facing role in your SaaS sales organization is the analysis of the following positions, duties, and experience required by each: “Sales Development Rep (SDR): Prospecting.” Account Executive (AE): Sales Acquisition, also known as a Sales Manager (SM). Positions may range from a first AE job (Junior) to an AE with three to five years of experience (AE), or four to eight years of experience (Senior).
The first step in providing fair compensation to each customer-facing role in your SaaS sales organization is the analysis of the following positions, duties, and experience required by each: “Positions may range from a first SDR job (Junior) who is focused on inbound sales to a Senior SDR with one to four years of experience who calls on key accounts (Account Development Rep).” Account Executive (AE): Sales Acquisition, also known as a Sales Manager (SM). Positions may range from a first AE job (Junior) to an AE with three to five years of experience (AE), or four to eight years of experience (Senior).
“Every organization should determine the right compensation plan for each individual sales role upfront using a proven target-setting model and a multitude of other factors.” Compensation in Sales Positions
“Companies should consider how to structure base and variable pay and then set forth the responsibilities of the role and the terms of compensation clearly in a sales incentive plan.” Compensation in Sales Positions
Keep it simple. Your compensation plan should fit on a single page of paper. “Show causality. Make compensation directly related to the desired effect you wish for the team member to achieve.” Think short-term. Keep the time between the activity and the compensation less than 60 days.
The first step in providing fair compensation to each customer-facing role in your SaaS sales organization is the analysis of the following positions, duties, and experience required by each: “Positions may range from a first SDR job (Junior) who is focused on inbound sales to a Senior SDR with one to four years of experience who calls on key accounts (Account Development Rep).” Account Executive (AE): Sales Acquisition, also known as a Sales Manager (SM). Positions may range from a first AE job (Junior) to an AE with three to five years of experience (AE), or four to eight years of experience (Senior).
Account Development Rep Compensation “Account Development Reps (ADR) are different from SDRs in that ADRs focus on key accounts or targeted accounts.” If you have a group of Development Reps, you may have to combine a variety of these tasks across roles and across time. For example, a major annual event such as an industry trade show may influence the way you compensate each role.
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