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SPIFF math. Before you run it.
Most sales SPIFFs pay for deals that would close anyway. Subtract the baseline to see real ROI.
Inputs
Results
Payout / rep
$1,500
if they hit target
Program cost
$15,000
total payouts
Incremental revenue
$120,000
15 extra units
ROI
8×
revenue ÷ cost
Benchmark
Strong ROI
Every $1 of SPIFF returns $8 in incremental revenue.
How it works.
The trap is forgetting the baseline. If the team books 15 units without any SPIFF, paying $500 each on 30 units means $7,500 of the $15K spend bought you nothing.
FAQ.
What is a SPIFF in sales?+
SPIFF (Sales Performance Incentive Funding Formula) is a short-term cash or prize bonus tied to a specific behaviour: pushing a new product, hitting a deadline, booking demos in a slow week.
When should I run a SPIFF?+
End of quarter to pull deals forward, launch of a new SKU you want reps pushing, or to refocus the team mid-period. Don't run them constantly — reps learn to wait for the SPIFF before doing the work.
What's a typical SPIFF amount?+
$50–$500 per behaviour for SDR-level activity, $500–$5,000 per closed deal for AE-level pushes. Big enough to notice, small enough that it doesn't replace base commission.
How do I measure SPIFF ROI?+
Incremental revenue ÷ total program cost. Subtract the baseline — if you'd close 80 of these deals anyway, only count the lift above 80. Most failed SPIFFs paid for revenue that was coming anyway.
Cash or non-cash prizes?+
Non-cash (trips, gadgets, experiences) outperform cash dollar-for-dollar in motivation research, but cash is easier to administer. Mix them — vary the prize so it stays interesting.