Radio Sales Café

At my company if your new business order is modified, you no longer get the 20% new business commission. I'm curious if this is standard?

Have no idea why this policy is in place as a revision in no way changes the new business status. Right? In the real world, business is dynamic and schedules change for lots of reasons (inventory delays, revision in focus, late copy approval, schedule extensions, etc). This is a punitive policy that seems to be more about enhancing company performance at the expense of its foot soldiers. I'm sure this is great for morale, right?

I guess every company is different. Everywhere I've worked it's been 15% across the board. My current employer, however, only pays 10% on trade or daily deals items.

lol what new business commission!!, that sounds like a motivating idea though, I will be suggesting we have one at our next sales meeting!! :-) if we did have one I would think it would be unreasonable to withdraw it as it would be based on what the new business spends in their first order or first six months of business etc and any modification in those spend values would be reflected in the commission pay-out which is as it should be, ask your management why they withdraw it they would need to have a reason which would be interesting to hear   

Have seen this before -  as an incentive to get new businesses on air.  This policy is in place so that the original new business is not continually extended as part of the 'new' business. The first new order inputted earns 20% -  the 3 months of news, the weekend package, the 3 week schedule.  After that, this client is not new business. Any adjustments would now be made on an existing account. Modifying the length of time, rearranging the airdates or times would require inputting a new order for an existing client.

You have to admit that there are salespeople who would 'game' the system, perpetually extending the original order as tho new business.  

Does your station always offer the new business incentive, Kate, or only for certain periods of time/times of the year?

They always offer that. As a way to get sellers to bring in new local direct business.
But my issue is that for example, I put in an order for 3 months, with the date being June 1st - then the client chemages their mind and wants to start the schedule a week later, I'm told we lose 5%. Brining new business 20% comm. to 15% ...
Schedules change all the time, doesn't seem motivating at all.

Changes *** typo

Completely agree with your post.
It's the nature of the business.

That seems nitpicky - since the order is still the first order for that client and has not even started to air. It would also encourage sandbagging, which managers hate because it screws up their projections. And, if your company, like ours, requires payment in advance then it has already been paid for.
Have you made a case for all this - not to mention the disincentivizing nature of it all - to management? Perhaps to make an exception in this case?

This type of thing occurs in ANY sales organization category. The newspaper here caps sales earnings, for example. And a friend in construction equipment sales has had this kind of thing happen. It's not always a lack of scruples by management. Rules are often created because of people who 'job' the system. We created rules to address the behavior of a specific employee who doesn't even work here now! Goes both ways so it never hurts to make a constructive appeal to management and ask for an exception or change in the rule. We have done that.
I take it you got out of sales altogether, Jane?

Fortunately, I've never worked under such silly rules.  After reading the other comments, I believe it is a terrible way to motivate salespeople to bring in new business.  I worked for a website development company once that tried a similar tactic of only paying commission on the initial order and nothing on upgrades, upsales, renewals, etc.  It is very short sighted because a company is telling their sales staff that the new customers are worth more than the ones they already have.

In reality, the cost to get a new customer is 2 to 10 times what it costs to keep a customer and help them grow.  But under this pay structure, they are encouraging you to ignore a client and always look for fresh blood. That creates churn of clients if they are not being taken care of.

15% is pretty standard for everything, but I've seen stations that pay higher rates for local direct and lower commission rates for agency business.

I have a 20k order for six months... Client paid 5k upfront and will be paying a portion of the remainder each month. Does your station require COMPLETE payment upfront on new orders?

It's not silly if done for a specific reason - like a sales staff that is really poor at cold calling and bringing in new clients. There is a natural attrition w clients and only so much of the attrition can be made up by added sales to existing clients. You need new clients to grow your billing.
The way Kate's company withholds the 20% for 'any' change is unfair. That could mean the client wants 6a-7p instead of 6a-10p. This is not something the salesperson can control. If these changes happen within a week of when the order is turned in or some other deadline, the salesperson should get the extra 5%. The sales manager should probably review each situation rather than work this under a blanket rule.

No - first month.

The size of your order, the 6 mo period and the 25% up front payment  -  this is totally screwing you over.  You have every right to argue this.  I hope you decide to do that Kate.

I finally spoke with someone who knows (I was given many different answers)
Apparently you can change flight dates, day parts, etc. it's only if you add or change the original order that makes you lose the .5% commission.

Good for you, Kate.  You earned that bonus!

Never heard of anything like this.

Thanks Diane.