Performance-Based Compensation in Marketing

“We love putting some skin in the game.”

Marketing is essential to the growth and success of most businesses, both those that are younger and those that are more established.  While most executives and business owners understand its importance, many struggle with the dollars invested in getting it right and knowing what is really working.

We think the answer for many lies in a program that includes performance-based compensation and a budget that aligns marketing agency profitability on the account with results generated.

Why? Most salespeople are commonly paid based on accounts won and grown. Why not marketing too? Why not put some skin in the game, putting dollars at risk?

While establishing a marketing program with results parameters for payment of many fees takes time on the part of both the agency and the client, we think the upfront investment is well worthwhile.The time invested is likely to sharpen knowledge and focus on critical goals and results necessary to create the grown and profits envisioned.

An approach like this can be particularly attractive to clients launching newer products or perhaps re-positioning one that needs a fresh program for promotion, growth, and profitability.

If marketers want a seat at the leadership table and to be rewarded for their efforts, it is time that they look at options like performance compensation that fundamentally align their stakes and profitability with the rewards obtained by the client.