Sales Strategy:

The Lost Art of Using Incentives in Sales

The Lost Art of Using Incentives in Sales

Many companies have unintentionally abandoned one of the most powerful tools in the sales toolbox: incentives. When used correctly, incentives are not desperate discounting tactics, they are strategic levers that help sellers build urgency, remove friction, add value, and ultimately close more deals.

From pre-pay discounts and rebates to personalized gifts and co-marketing perks, the thoughtful use of incentives can drive faster conversions, larger deals, and greater customer loyalty. Yet many sales organizations have underutilized or outright forgotten this art.

This article explores the full range of incentive strategies, price-based, value-added, relational, risk-reducing, and experiential, to help sales leaders and professionals re-empower their teams with tools that win.

Why Incentives Still Matter

Incentives aren’t about slashing prices. They're about strategic alignment, encouraging a customer to act sooner, buy more, stay longer, or promote your brand. When used thoughtfully, incentives can:

  • Accelerate the decision-making timeline
  • Encourage larger or recurring purchases
  • Differentiate your offer from competitors
  • Strengthen customer loyalty and retention
  • Empower your salesforce with deal-closing tools

Yet incentives are often missing from the conversation, buried under CRM data, pricing models, or overly rigid approval processes.

Let’s fix that.

The Comprehensive Spectrum of Sales Incentives

1. Price-Based Incentives

These incentives reduce the financial barrier to purchasing and are often the most direct path to creating urgency.

Common Types:

  • Pre-Pay Discounts – Save 2–5% for paying upfront or on faster terms.
  • Volume Discounts – Lower unit pricing for larger orders or commitments.
  • Limited-Time Offers – Flash sales, holiday promos, or quarter-end price cuts.
  • Rebates – Cash-back or credit incentives issued after purchase or when volume thresholds are hit.
  • BOGO (Buy-One-Get-One) Deals – Buy one product or license, get another free or discounted.
  • Early Bird Pricing – Discounts for signing early, especially for new products or renewals.
  • Loyalty Pricing – Better pricing tiers for returning or long-term customers.

Best Used When: You need to create urgency, increase order size, or get deals over the finish line quickly.

2. Value-Added Incentives

Instead of lowering the price, increase the value. These incentives enhance the customer experience or add utility to the purchase.

Common Types:

  • Free Trials or Samples – Let prospects try before they buy.
  • Free Upgrades – Give access to a premium tier or advanced features.
  • Bundled Packages – Combine multiple offerings for a better value (e.g., "Buy X, get Y at 50% off").
  • Exclusive Access or VIP Memberships – Early access to features, products, or beta programs.
  • Extended Warranties and SLAs – More support, longer protection, better service levels.
  • Training & Onboarding Services – Complimentary education, certifications, or white-glove implementation.
  • Joint Promotions with Complementary Brands – Add extra value through co-marketed offers.

Best Used When: Selling complex solutions, launching new products, or targeting customers who prioritize support, service, or long-term value.

3. Relationship-Focused Incentives

These incentives deepen the connection between buyer and seller, often through recognition, appreciation, or shared success.

Common Types:

  • Loyalty Programs – Accrue points or tiers that unlock discounts, perks, or gifts.
  • Referral Bonuses – Customers receive rewards for introducing new clients.
  • Customer Recognition – Case studies, testimonials, and public spotlights that honor customer success.
  • Networking Opportunities – Invite customers to private roundtables, events, or community groups.
  • Surprise & Delight Gifts – Personalized thank-you items or milestone celebrations.
  • Anniversary or Renewal Perks – Special offers when contracts are renewed.

Best Used When: You want to reduce churn, drive upsells, or encourage evangelism among your customer base.

4. Experiential and Cause-Based Incentives

Modern buyers—especially in B2B—respond to authenticity, values alignment, and memorable experiences.

Common Types:

  • Cause-Based Incentives – Donate to a nonprofit or cause on the buyer’s behalf.
  • Surprise Milestone Gifts – Celebrate new contracts, launches, or anniversaries with a thoughtful touch.
  • Exclusive Experiences – VIP events, behind-the-scenes access, or speaking opportunities.
  • Recognition-Based Incentives – Offer leadership visibility through webinars, panels, or thought leadership content.
  • Legacy Loyalty Rewards – Lifetime perks for long-standing customer relationships.

Best Used When: Building emotional connection, deepening trust, or creating brand advocates.

5. Payment-Term Incentives

Altering the structure of the payment rather than the price itself can be incredibly persuasive.

Common Types:

  • Deferred Payments – Pay later (e.g., Net-90 or delayed first invoice).
  • Interest-Free Financing – Pay over time without extra cost.
  • Split Payments or Installments – Lower up-front burden.
  • Subscription Lock-In Bonuses – Locking in multi-year terms at a better rate.

Best Used When: Budget objections arise or you’re dealing with long sales cycles and risk-averse buyers.

6. Partner and Channel Incentives

For channel, distributor, or reseller sales, incentives are crucial to motivating 3rd-party reps and partners.

Common Types:

  • SPIFFs (Sales Performance Incentive Funds): Bonus payouts for closing designated deals.
  • Tiered Rewards: Additional incentives as partners hit higher revenue tiers.
  • Market Development Funds (MDF): Co-branded marketing budget or funding.
  • Enablement Incentives: Training completion bonuses or co-selling rewards.

Best Used When: You sell through others and need to influence how they prioritize or promote your offerings.

7. Gamification and Internal Incentives

Sometimes, the best incentive is applied internally to your sales team to keep motivation high.

Common Types:

  • Sales Contests: Competitions tied to KPIs—volume, revenue, speed, etc.
  • Leaderboards: Public recognition of top performers.
  • Team-Based Rewards: Celebrate wins with team events or group bonuses.
  • Points-Based Systems: Points accrued for activities can be redeemed for rewards.

Best Used When: Boosting morale, energizing slow quarters, or creating a performance culture.

8. Trust-Building Incentives: Guarantees and Warranties

These incentives reduce perceived risk for the buyer, helping them commit with greater confidence, especially when they’re unsure or new to your offering.

Common Types:

  • Money-Back Guarantees: Full refunds offered within a specific timeframe if the buyer is dissatisfied.
  • Risk-Free Trials: Try the product or service before committing financially.
  • Satisfaction Guarantees: Pledges to resolve issues or refund if expectations aren’t met.
  • Extended Warranties: Longer coverage to ensure product performance.
  • Performance Guarantees: Refunds or credits if certain KPIs are not achieved.
  • Service-Level Agreements (SLAs): Contractual uptime or response time guarantees.

Best Used When: You're selling high-ticket, high-risk, or complex products, especially to first-time buyers or in competitive bids where trust is the deciding factor.

9. Bonus Category: Emotional, Experiential, and Cause-Driven Incentives

These incentives tap into psychology and personal connection. They can amplify satisfaction, build reputation, and make your brand unforgettable.

Examples include:

  • Charitable Giving: Let the buyer choose a charity and donate on their behalf.
  • Customer Spotlights: Celebrate clients in newsletters, podcasts, or blogs.
  • Legacy Acknowledgment: Offer "Founder’s Club" or legacy customer status after multi-year engagement.
  • White Glove Events: Invite high-value clients to intimate, curated experiences.
  • Milestone Tokens: Celebrate client anniversaries, personal achievements, or usage milestones.

Best Used When: You want to create a lasting emotional imprint and deepen long-term relationships.

Best Practices for Using Sales Incentives

To use incentives effectively without eroding margin or conditioning bad buying behavior:

  1. Align Incentives with Goals: Use the right incentive for the right action, don’t throw out discounts at random.
  2. Give Salespeople Authority (Within Limits): Create a defined menu of approved incentives so they can move deals forward without endless approvals.
  3. Tailor to Buyer Personas: CFOs may prefer rebates or payment flexibility, while CMOs might prefer exclusive access or recognition.
  4. Avoid Overuse: Use incentives sparingly and tactically to retain their impact.
  5. Track Performance: Monitor close rates, deal sizes, and repeat business by incentive type.
  6. Stack Wisely: Combine incentives (e.g., free upgrade + early bird discount) only when strategically justified.

Final Thoughts: Don’t Leave This Tool on the Shelf

Incentives aren’t just for holiday sales or desperate closes. They are core to human psychology, tapping into urgency, reward, recognition, and value. In a world of commoditized offerings and increasingly analytical buyers, a well-placed incentive can break inertia and earn the “yes.”

It’s time to dust off the incentive playbook. Modernize it. Empower your sales team with options. And rediscover what generations of great sellers already knew: when the deal is close, the right incentive closes it.