Beware the Cobra Effect: 3 Sales Contest Mistakes to Avoid
There's a reason that 74% of sales leaders have run a contest in the past 6 months — or plan to run one soon. Sales gamification drives revenue (and engagement, and culture, which — hey, also drive revenue!). But without question, there's a right way and a wrong way to run your sales competitions.
Avoid the Cobra Effect
If you're unfamiliar, the "cobra effect" occurs when an intended solution actually makes a problem worse. For the history buffs out there: the concept comes from the time of British colonial rule in India, when they discovered that India has a lot of pesky (oh, and extremely poisonous) snakes.
The British solution? Put out a bounty for every dead cobra. The result? Tons of people competing to secure a bounty. The unintended, negative consequence? People started breeding their own cobras to secure bigger bounties. The government caught on, of course —but now there were even more snakes than when the initiative began.
Moral of the story — and yes, this is directly related to sales! — whatever motivation tools you leverage, they must drive the right behaviors, or you could end up with more problems than you started with.
With that in mind: here are 3 competition mistakes you do not want to make if you're hoping to avoid the cobra effect.
1. Don't give activities equal weight.
Repeat after us: all activities are not created equal. Jay Tuel, the VP of Sales at Demandbase, knows this well. One of the primary reasons Demandbase began using Ambition was because their SDRs relied too heavily on emailing for outbound initiatives. Based on historical data, leadership knew that calls would produce more qualified leads, faster.
Jay needed to change behaviors and mindsets across his sales team. So, he worked with his managers to build a Fantasy-football themed contest — with the use of TVs, scorecards and dashboards — and his team was instantly addicted to picking up the phone.
Over the course of 11 weeks, his 25 SDRs competed on three teams, each vying for the highest weekly activity score. Meetings set by calls were the most heavily weighted activity — helping to instill behavior change across the team.
Emails are an important channel of communication, so Jay didn't want to cut those out. But had he not weighted calls more heavily that emails, he easily would have been facing his very own cobra effect. Emails are easy and fast, so his team would have spent even more time emailing than they already did, which would have had the opposite effect that Jay was going for.
Because Jay knew what he was doing, and he leveraged Ambition's contest tool strategically, he got great results: Demandbase’s SDRs increased voicemails by 16x, call connects by 7.5x, and meetings booked by phone by 31x on an average weekly basis.
2. Don't spin up competitions in a silo.
Competitions are fun — but they should serve a much greater purpose. Every competition you run should be tied clearly and directly to the goals you've set for your team.
Yes, you want to get the energy and engagement levels up. You want to bring a buzz to your sales floor. But you also want everyone involved to understand the hard numbers that they're driving toward.
Let's go back to the Demandbase illustration: Jay didn't want to simply increase activity; he wanted to increase call activity. And that's because he knew, based off of data, that calls lead to more opportunities — and opportunities lead to revenue.
3. Don't leave your average performers out in the cold.
The vast majority of your team (think: 90%) will never make it on a traditional leaderboard — while your top performers will spend a whole lot of time up there.
If you want your competitions to motivate — not demoralize — your middle players, get creative about how you're structuring your contests. Maybe you focus on team competitions versus individual challenges. Or maybe you leverage a Most Improved Leaderboard, where you recognize players for the strides they're making and results they're generating as they continue to build and hone their sales skills.
Want to see how the best of the best run their sales contests? Check out our webinar recording all about competition strategy!