Business and Management

Boost Sales Performance Using the ‘Goal Gradient Theory’

Behavioral economists have identified a new theory called as 'Goal Gradient Theory' which was discovered by researchers in the 1930s.

The theory works for the human behavior too. In loyalty programs, people tend to buy more as they close-in on an award level. People saving for a special purchase will increase their contributions as they near the target amount.

Following are the four best possible ways to achieve that long term goal in accordance with the goal gradient theory. However, to increase you sales you can also visit

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Start with a quick action plan: Prepare the sales reps in achieving the annual goal by offering employee incentive awards to those who are able to achieve sub goals within the initial 20 to 30 days.

Break up the annual goal into smaller increments: Avoid the temptation to simply divide the annual goal by 12, unless your business has absolutely no seasonality and 1/12th is predictable. Instead, keep seasonality in mind and decide on smaller rewards for doing what can be done in slower times so that the sales staff remains focused.

Provide consistency bonuses: Offer a small bonus reward for those who are consistently working on their short term targets and goals paving the way towards achieving the annual goal. This can motivate the sales reps who tend to delay and lose focus.

Close with strong sales staff incentives: When you are nearing towards the year end, offer a tiered bonus plan. The sooner you meet your annual goal, the larger the bonus that you will receive.

The competition can also be increased and made more reasonable by providing bonus to the first 10 or 15 sales representatives who achieve the annual goal sooner.