Compensating your commercial team
Your commercial teams capture market share in embedded payments. A strong incentive program will keep them motivated. Here are some common ways to do so:
#1: Platform strategy: Quick market entry
To enter the market quickly and close deals, platforms can leverage a targeted incentive strategy: Offer a fixed bonus for every contract that bundles software and payment solutions.
To ensure these customers become active users, tie the bonus to key activity milestones, such as completing KYC verification and activating at least one terminal.
Example Sales reps earn a $40 bonus for closing a deal, and an additional $60 bonus when onboarding is completed and the customer activates a terminal. This performance-driven structure ensures bonuses are tied to measurable outcomes that drive user engagement.
Deal A: The sales rep earns $40 for signing the contract and an extra $60 for onboarding completion and terminal activation—a total of $100.
Deal B: The sales rep gets $40 for closing the contract, but no extra bonus since onboarding doesn’t guarantee user activation.
Deal C: Similar to Deal B, only the initial $40 bonus applies without further activity milestones met.
While this approach can accelerate deal closure and boost fast market entry, it's not focussed on optimizing long-term customer engagement and retention.
#2: Platform strategy: Long-term value and steady revenue streams
We see that successful GTM strategies involve making embedded payments non-negotiable in deals.
Platforms pursuing this approach ensure that their software solution or POS offering is tightly integrated with their white-labeled payments. The core value of your solution should be so compelling that customers are drawn to it for its unique features—payments then become a value-add.
Example
Let’s say Platform X has a target Blend Rate for payments of 2.3% + $0.20.
Below Target Deals: For deals closed under this threshold, sales reps earn a bonus based on a percentage of the average margin over the first three months.
At or Above Target Deals: Deals closed at 2.3% + $0.20 or higher unlock even greater rewards. Sales reps not only earn the margin percentage bonus but also a Fixed Bonus of $400, called a kicker.
Let’s put that in practice:
Deal A: Closed above 2.3% + $0.20. The sales rep earns a percentage of the average margin and an additional $400 bonus for exceeding the target.
Deal B: Closed below 2.3% + $0.20. The sales rep only earns the percentage-based margin bonus—no fixed bonus applies.
#3: Platform strategy: Scaling through partner network / resellers
For SaaS platforms aiming to scale through a third party reseller / partner network, a well-structured compensation structure is pivotal.
A common approach is to compensate these partners with a percentage of the processing and/or payment method fees, aiming for a performance-driven partnership.
Unlike traditional one-time commissions, this approach ensures compensation aligned with customer growth, fostering long-term reseller engagement.
Why is this crucial? Resellers, who often juggle multiple lucrative providers, need clear financial benefits to prioritize selling your solution.
Example
Resellers’ cut exists of:
Percentage of platform markup payment method fee (e.g. 25% of 0.5%)
Percentage of acquiring markup payment processing fee (e.g. 20% or 10 cents)